NSW Labor’s new deamalgamation law fails local communities

May 10, 2024
A meet the candidates at Leichhardt Town Hall in March 2023 where candidates were quizzed on their views on deamalgamation. Photo: Peter Boyle

NSW Labor passed amendments to the Local Government Act on May 9 which give the Minister for Local Government the ultimate say over whether councils can demerge or not.

Despite its pre-election promise to communities, Labor — with the support of the Liberal-National Opposition — has shifted power away from communities.

Brian Halstead, from NSW Demerge Alliance, said: “Labor MPs spoke at length about how forced council amalgamations had failed communities, especially those from small councils which had been swallowed up, but then rammed through amendments which centralise power with the minister.

“This is one hell of an about-turn from before the 2023 election, and communities will not forget Labor abandoning them.”

Halstead said an example of Labor’s scornful attitude was its removal of government liability to fully fund any demerger.

“Only because it needed the Opposition to get its bill passed did Labor accept the Liberals’ amendment of a cost contribution in the form of a grant, capped at $5 million with loans above that amount.

“This will help regional councils, but may not cover all expenses, thereby shifting the costs of a failed policy back onto residents — who mostly didn’t want their council amalgamated in the first place.”

Dr Amanda Cohn said the new demerger provisions fail to restore local democracy to allow communities to instigate referendums to demerge.

Cohn, a former Deputy Mayor at Albury Council, criticised Ron Hoenig, Minister for Local Government, for claiming to value democracy but proposing a bill “that gives himself more power than councils and communities”.

Cohn’s Local Government Amendment (De-amalgamation Plebiscites) Bill 2023, tabled in last November, would have enabled binding plebiscites on a demerger and clarified that the government would fund any deamalgamation.

She worked with community groups from Gurya in the north to Bombala in the south and in between, for more than a year, to develop the bill.

But Labor and the Opposition refused to support her democracy-enhancing bill, producing its own in February.

The Greens moved amendments to their own bill on May 8, aimed at resolving “problems” Labor had raised, but it and Opposition MPs rejected the bill regardless at 9pm.

The Greens also moved amendments to the government bill in the Legislative Council on May 9, which were opposed by both Labor and the Opposition.

These were to bind the Minister to act on the result of any de-amalgamation referendum (which Labor’s bill gives the Minister discretion not to do); and to ensure that residents can still petition for a de-amalgamation proposal — critical for smaller communities whose councils were amalgamated into larger councils, such as Pittwater, Guyra, Bombala and Urana.

Labor’s new bill means that even after a council goes through producing a business case, goes through the NSW Boundaries Commission process and has a referendum (Labor’s new amendments), the Minister has the power to veto all of that.

Halstead said Labor “wasted an opportunity” to put the local back into council. “Labor stands exposed for saying and doing contradictory things: trust has been lost as we will no doubt see at the September 2024 local government elections.

Cohn said communities in Bombala, Canterbury Bankstown, Central Coast, Cootamundra-Gundagai, Guyra, Inner West, Pittwater, Hilltops and Tumbarumba have been “campaigning to restore local democracy for seven years and they will continue to campaign for council de-amalgamation and for local democracy to be restored”.

[Pip Hinman is an activist with the Inner West Residents for Deamalgamation.]

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