Forced Amalgamation Research Articles

Policy‐Based Evidence Making in Local Government: The New South Wales’ Municipal Merger Program, 2011 to 2017

Contemporary public policymaking relies heavily on commercial consultants for specialised advice. In this paper, we examine the problematic nature of this phenomenon by considering the controversial forced amalgamation programme in New South Wales (NSW) local government over the period 2011 to 2017. By way of a critical examination of two key consultant reports underlying the NSW municipal mergers, we show that the failure of this programme to achieve its intended aims is due in large measure to the nature of the externalised advice on which it was based and the manner in which that advice was solicited from commercial consultants.

Constitutions, Citizenship and the Challenge of National Integration and Nation-Building in Africa

Summary Most countries in Africa are both “multination” and “polyethnic” states. This is due partly to the forced amalgamation, by the European colonialists, of the continent’s “ethnocultural nations” into single economic and political units that were called “colonies.” These colonies eventually evolved into what are today’s independent African countries. Today, many of these ethnocultural groups want to secede and form their own independent polities in order to have more autonomy over policies that affect their well-being, including especially their cultural and traditional values. The struggle by these groups for either outright secession or so-called enhanced rights has created many challenges for governance, national integration and nation-building in many countries in Africa today. Throughout the continent, inter-ethnic conflict, for example, over the allocation of scarce resources, has produced sectarian violence that has led to civil wars (as occurred in Liberia, Sierra Leone, Rwanda, and Nigeria) and significantly endangered prospects for peaceful coexistence. It has been suggested that the solution to this political quagmire is the creation of differentiated citizenship rights for each of these groups. The paper suggests that of the three types of differentiated citizenship that have been suggested as a way to accommodate diversity—self-government rights, polyethnic rights, and special representation rights—self-government rights pose the greatest threat to social, political, and economic stability in the African countries. The solution to this governance challenge may lie in inclusive and robust dialogue, which can help these groups find a way to remain citizens of their present polities, while at the same time, retaining their cultural identities.

Thinking Regionally: How to Improve Service Delivery in Canada's Cities

As city-regions across Canada continue to grow, the need for some municipal services, such as mass transit, is shifting from a local to a regional basis. This transformation is giving rise to regional servicing challenges, placing greater pressure on city-regions and their municipalities to provide services across municipal boundaries in a coordinated and streamlined fashion.For instance, cross-boundary commuters in the Greater Toronto and Hamilton Area face an array of unintegrated local transit systems and fare structures that are apart from the regional transit authority, Metrolinx. While mass transit in the Vancouver metropolitan area has been integrated under the regional transit authority, TransLink, local and provincial officials are looking for ways to improve the governance of TransLink.The antiquated solutions of forced amalgamation and provincial mandates on service sharing have produced few economies of scale and have greatly undermined local autonomy. Provinces need to shift their focus from imposing centralized local government to creating frameworks that promote cooperative and flexible local governance. By working together in such a framework, municipalities can identify and resolve regional servicing challenges effectively, all while keeping amalgamation at bay and their local autonomy intact.City-regions across Canada should be looking to the regional district governance model in British Columbia, where regional districts are “regional coordinators,” rather than “regional authorities” with topdown powers. The distinction matters greatly for regional governance.Along these lines, TransLink in British Columbia and Metrolinx in Ontario should include local policymakers and stakeholders on their boards more than they do today. This would result in transit services being better tailored to the municipalities served and would improve accountability and transparency.The Alberta government has been engaged in a series of changes to the Municipal Government Act, with a particular focus on mandating how municipalities are to work together. Instead of this authoritative approach, which has failed in Ontario, Alberta should create the kind of regional governance framework in which municipalities will want to work and cooperate.Intermunicipal cooperation offers municipalities an effective means to strike an efficient balance between the need to meet regional interests on the one hand and to maintain local autonomy on the other.

Enduring Financial Sustainability Through “Bottom-Up” Local Authority Ingenuity and Rational “Top-Down” State Regulation: The Case of Lake Macquarie City Council

For decades Australian policy-makers have relied on the blunt instrument of forced amalgamation to reform local government. However, a host of recent public inquiries has demonstrated that despite compulsory mergers in all states, except WA, financial unsustainability has become more acute. Using the case study of the successful achievement of ongoing financial sustainability by Lake Macquarie City Council in NSW through its resourceful “bottom-up” use of the “top-down” financial parameters set for NSW local government, this paper argues that state governments should concentrate on “process change” by establishing sound “top-down” regulatory frameworks thereby enabling “bottom-up” ingenuity by local authorities rather than “structural change” through compulsory mergers.

Did the Big Stick Work? An Empirical Assessment of Scale Economies and the Queensland Forced Amalgamation Program

In 2007, the Queensland Government imposed forced amalgamation with the number of local authorities falling from 157 to just 73 councils. Amalgamation was based inter alia on the assumption that increased economies of scale would generate savings. This paper empirically examines pre- and post-amalgamation (2006/07 and 2009/10) for scale economies. For the 2006/07 data, evidence of economies of scale was found for councils with populations up to 98,000, and thereafter diseconomies of scale. Eight percent of councils in 2006/07 (ten councils) – representing 64% of the state’s population – exhibited diseconomies of scale. For the 2009/10 data, the average cost curve remained almost stationary at 99,000 residents per council, but almost 25% of all councils (thirteen councils) were now found to exhibit diseconomies of scale. The compulsory merger program thus increased the proportion of Queensland residents in councils operating with diseconomies of scale to 84%.

An Evaluation of Amalgamation and Financial Viability in Australian Local Government

Like numerous other local government systems in developed countries, Australian local government confronts daunting financial problems, perhaps most acutely evident in the emergence of a severe backlog in local infrastructure maintenance and renewal. Australian local government policy makers have relied to an unusual and extreme degree on compulsory council consolidation as the main policy instrument to tackle the financial crisis. This paper sets out the dimensions of the financial crisis and the attendant heavy reliance on forced amalgamation and then goes to consider the efficacy of compulsory council consolidation as a means of improving financial viability in Australian local government through the prism provided by eight national and state-based public inquiries into financial sustainability in local government over the past decade. With one exception, these inquiries are skeptical of the ability of forced amalgamation to improve local authority financial viability.

Mergers by Choice, Not Edict: Reforming Ontario's Electricity Distribution Policy

Provincially appointed panels have recommended that the province of Ontario force local electricity distribution companies (LDCs) to amalgamate into a handful of large, regional operations. However, just as forced consolidations of municipalities have led to few clear savings, so too it is unclear that forced amalgamation of local electricity distributors would lower costs in the sector. Instead of forcing mergers, provincial policy should be neutral towards mergers and acquisitions, permit private sector participation, and allow individual LDCs and municipalities to make their own choices.Accordingly, the government should reform tax policies that currently impose barriers on private investment, and permit individual distribution companies to pursue commercially sensible mergers and to seek the private investment they need to renew their aging capital stock.The case for forced amalgamations depends on two premises: first, that there are too many distributors in Ontario; and, second, that the government should encourage or force consolidation. These premises are, however, logically independent from each other: even if there are too many distributors in light of potential scale economies, the case for a government-directed consolidation should be examined on its own merits.Although many LDCs are smaller than the optimal size, there is no evidence to suggest that a few very large, amalgamated LDCs would be the most economically efficient outcome.A more fundamental question than scale is that of ownership. Ontario tax policy is neutral toward mergers of publicly owned LDCs, but restricts private sector participation in the sector. As a consequence, tax policy prevents any consolidations led by commercially owned companies. In our view, the province should remove barriers to private sector investment in the distribution sector, which it can achieve by eliminating taxes on sales of LDCs to private companies.To preserve the provincial tax base if Ontario were to eliminate taxes on the transfer or sale of LDCs to private companies, the federal government should enact changes to the Income Tax Act. The federal government should either allow LDCs to remain tax exempt with as much as 49 percent private ownership or, even better, introduce a transfer tax system in which it remits to the province corporate taxes it collects from privatized utilities.

Shared Service Models in Australian Local Government: the fragmentation of the New England Strategic Alliance 5 years on

In 2004, the New England Strategic Alliance of Councils (NESAC) was formed in a successful effort by its member municipalities to avoid forced amalgamation by the NSW government in its (then) program of compulsory council consolidation. The Armidale-Dumaresq, Guyra, Uralla and Walcha Councils, as well as the New England Weeds County Council, formed a ‘strategic alliance’ under the auspices of NESAC. Over the past 5 years this alliance of councils has developed a model of shared service provision. However, in early 2009, the Walcha Shire Council dramatically announced that it would leave NESAC. This momentous decision raises several interesting questions and may have broader lessons for shared service provision in Australian local government. This paper thus seeks to augment the existing embryonic literature on shared services in Australian local government by analysing the withdrawal of the Walcha Shire Council from NESAC through interviews with the general managers and mayors of the participating organisations.

A Typology of Shared Service Provision in Australian Local Government

Disappointment with the results of forced amalgamation programs across almost all Australian local government jurisdictions has created great interest in shared service models as an alternative method of improving the operational efficiency of local councils, while at the same time preserving local democracy and local autonomy. While an embryonic literature on shared service provision in the Australian municipal milieu does exist, much remains to be done. This paper seeks to contribute to this nascent literature in two main ways: (a) to locate shared services in local government within broader global trends and theoretical disputations on devolution and local economic development, highlighting the importance of political geography in these debates; and (b) in the light of this complexity and ambiguity, develop a new typology of local government shared service provision to inform public policy making on real-world problems in Australian local government.

Rational choice, sense of place, and the community development approach to community leisure facility planning

This paper examines the decision‐making approach taken by rural communities when confronted with a decision to rejuvenate or decommission a recreation facility in their jurisdiction. A case study is presented that analyzes the tensions that were created in a community when an arena facility was recommended for closure in a report commissioned by the municipal council and completed by a consultant. More specifically, the article examines how that décision was reached by the consultant and municipal decision‐makers, and how other sectors of the community came to view the utility of that recommendation and the facility in question. The rational choice and sense of place models are compared and contrasted for their value in the research and decision‐making process. The subject of amalgamation of several communities into a single municipality is identified as a pervasive overlaying issue that affects the decision‐making process even though amalgamation was not the subject of this study. It is concluded that extraneous social and political factors, like the resentment of forced amalgamation in this case, need to form part of the framework for analysis in a community leisure research project. An analysis of the consultants’ report ending with a discussion about the value of a multi‐method research approach to data gathering and analysis forms the conclusion to the paper.

ABOUT TURN: POLICY REVERSALS AND THE QUEENSLAND LOCAL GOVERNMENT REFORM COMMISSION

In common with other Australian local government systems, Queensland local councils have experienced acute financial and other problems. In a collaborative attempt to address these problems, in 2005 the Queensland state government and the Local Government Association of Queensland (LGAQ) embarked on a Size, Shape and Sustainability (SSS) program to evaluate the sustainability of local councils and provide solutions to the problems the process was designed to unearth. The SSS process was hailed as the best example of voluntary cooperation between state authorities and local councils in the history of Australian local government reform. However, after almost two years, in a shock announcement on 17 April 2007 the Queensland Government unilaterally terminated the SSS program and established a Reform Commission to recommend a forced amalgamation across the state. This paper provides a critical appraisal of this drastic policy reversal by considering the official rationale for the ‘U‐turn’ and the formal response of the LGAQ to the turnaround in the light of broader trends in Australian local government.