Merges a last resort: CEO

28 Oct, 2005 08:45 PM

LOCAL government amalgamations should be a last resort for struggling communities, according to City of Albany chief executive Andrew Hammond.

Many local governments were looking for a way out of debt or to ease financial hardships, but amalgamation was not the answer, Mr Hammond said.

At the Small Town Survival Conference in York last week, speakers said numerous small towns in the Wheatbelt were finding it hard to attract people to the community and sustain the population.

The towns' challenge was to remain economically viable, find workers and keep the town alive.

"Amalgamation is not a solution to corporate inefficiency," Mr Hammond said.

"It would be a pity if four or five inefficient councils amalgamated because one big inefficient council would just be produced as a result."

Mr Hammond said councils needed to become more efficient with stronger decision making and financial planning.

"Local governments need to be realistic about their situations and assess what their position is really like," he said.

Mr Hammond said there were benefits to amalgamation, especially in a donut council such as Northam where the town council was surrounded by a shire council.

"Merging donut councils means there are no duplication of services, the same rules apply for both councils, there are staffing savings and common expenses are shared by users," he said.

Mr Hammond said councils that wanted to go ahead with amalgamations needed to be able to do so on their own terms.

"The State Government needs to make the process of amalgamation simpler; where there is not one set of rules for one type of transaction," he said.

"Rules need to be more specific to the situation."

With the State Government looking at reforming the local government system, Mr Hammond said there was a need to reform financial services between Federal, State and local governments.

Mr Hammond referred to recommendation 16 of the Hawker report, which suggested a complete review of the three tiers of governments' funding relationship.

The report proposed funds to be distributed on a fiscally equal relationship basis, where funds were shared on need per capita.

This would see WA local government reap 43pc more funding than presently, Mr Hammond said.

Mr Hammond said the Federal Government ignored this recommendation.

He said if the Federal Government enacted on the Hawker report recommendations WA local government would receive $45 million extra in the 2005/06 financial year.

"The eastern states' councils are reaping a financial bonus at our (WA's) expense," Mr Hammond said.


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