Self Interest Prevails !

Most people shudder when the council rates bill arrives in the mail.   The majority pay by way of quarterly instalments but this ever increasing impost to pay for council services becomes a major burden on family finances.  If unemployment becomes an issue, failing to pay the quarterly rates bill is usually the first financial casualty.

This week, Premier Mike Baird was heckled when he spoke at the Local Government NSW Conference because of the government's plan to force amalgamations amongst the 152 local councils that serve the residents of this state.  Their finances are in a parlous state and it is likely that some will fall into bankruptcy if their finances remain unchecked.

The government has imposed a 2.4% cap on rate increases and most councils have applied for special permission to exceed that increase - and these requests are simply mind boggling.  They range across the council spectrum  -  13%.   8.8%  and even a whopping 29.7% increase on last year's demand.  There is a danger that council rates could exceed the ability of low income earners to pay - and people could lose their homes.

Unpaid rates attract an interest impost and if the accumulation remains unpaid for seven years the council has the right to force the sale of the property.  They collect rates owing from the sale and any surplus is returned to the property owner.

Opposition to forced amalgamations is widespread and usually involves self interest.  The mayors and councillors enjoy a social standing that often is the preclude for a move into Federal or state parliament.  It certainly ensures that they will be feted by the media.  This is something they are reluctant to give up and amalgamation brings the risk that they may be unsuccessful in getting voted in within a wider voter pool.

Councils are a big employer of labour and the very nature of amalgamations ensures that duplications between smaller council units will see more achieved with a smaller work force.  Well paid unionised positions are deemed to be at risk, resulting in council employees heavily supporting retaining the status quo.

Even the long suffering public have reservations about amalgamations.   While they desperately oppose excessive rate rises there is comfort in having a small council body that is more approachable- and which responds to public pressure.   There is a fear that a bigger council will see their neighbourhood swallowed by an uncaring bureaucracy with centralized decision making.

Council amalgamations have been on the" to do " list for years, but various governments have lacked the resolve to actually bite the bullet and do the hard yards of implementation.  Each year council finances deteriorate further and the backlog of deferred upkeep increases.  Many councils are now close to a financial tipping point.

Mike Baird recently won a stunning election victory.   Forcing council amalgamations will not be a popular decision with perhaps the majority of people, but it is necessary if rates are to be stabilized and councils restored to a firm financial footing.  He seems prepared to spend political capital early in his new term to slay the rates dragon and ensure those bigger councils deliver more efficient services for the homeowners who pay their bills !