Abstract

The problem of the ‘financial sustainability’ of individual local councils represents the most significant policy question at issue in contemporary debate on Australian local government. This concern with financial sustainability has not only dominated almost all recent local government conferences across Australia, but it has also formed the capstone of several public inquiries into state local government systems. For instance, at the state level, both the South Australian Financial Sustainability Review Board’s (FSRB) (2005) Rising to the Challenge and the Independent Inquiry into the Financial Sustainability of NSW Local Government’ s (LGI) (2006) Are Councils Sustainable were centrally occupied with determining the meaning of financial sustainability in Australian local government and developing measures of financial sustainability. Moreover, the Queensland Local Government Association (LGAQ) (2006) Size, Shape and Sustainability (SSS) program, the Western Australian Local Government Association (WALGA) (2006) Systemic Sustainability Study and the Local Government Association of Tasmania (LGAT) (2007) Review of the Financial Sustainability of Local Government in Tasmania had at their core the problem of assessing financial sustainability in their respective local government systems.

Highlights

  • The problem of the ‘financial sustainability’ of individual local councils represents the most significant policy question at issue in contemporary debate on Australian local government

  • The Queensland Local Government Association (LGAQ) (2006) Size, Shape and Sustainability (SSS) program, the Western Australian Local Government Association (WALGA) (2006) Systemic Sustainability Study and the Local Government Association of Tasmania (LGAT) (2007) Review of the Financial Sustainability of Local Government in Tasmania had at their core the problem of assessing financial sustainability in their respective local government systems

  • We propose that the concept of local government sustainability should extend beyond the narrow confines of financial sustainability or financial viability to include the vibrancy of local democracy, local social capital and local council administrative and technical capacity

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Summary

Introduction

The problem of the ‘financial sustainability’ of individual local councils represents the most significant policy question at issue in contemporary debate on Australian local government This concern with financial sustainability has dominated almost all recent local government conferences across Australia, but it has formed the capstone of several public inquiries into state local government systems. In the New Zealand the Report of the Local Government Rates Inquiry (2007), entitled Funding Local Government, initially defined sustainability according to terms derived from the Government’s Fiscal Responsibility Act (1994) or what it described as ‘the affordability of expenditure and equity of funding over the long term’, noting that ‘in general, local government is paying insufficient attention to these issues’ (Rates Inquiry, 2007, 3) and incorporating ‘environmental sustainability’ into its recommendations Against this comparative international context, in this paper we pursue the question: aside from direct financial considerations, what other factors determine the broader long-run sustainability of Australian local councils?

Generic sustainability
Tensions between democracy and efficiency
Dominant values
Community sustainability
Vibrancy of Local Government Democracy
Local Social Capital and Local Government
Local Government Capacity

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