Saturday, July 13, 2024

De-amalgamation bill to deliver certainty for NSW councils

The NSW Government has introduced new legislation that will remove a major roadblock to council de-amalgamations and ensure local democracy is enshrined in the decision-making process, Local Government Minister, Ron Hoenig said today.

The amendments to the Local Government Act 1993, introduced to Parliament today, are set to provide a new legal pathway for NSW councils seeking to demerge, including those that already have de-amalgamation proposals under consideration.

The amendments repeal the legally flawed section 218CC of the Act and replaces it with a clear and democratic process.

“The forced amalgamation of NSW councils was a failed and expensive experiment,” said Minister Hoenig (pictured).

“While the NSW Government strongly supports a clear process for councils and communities to exercise their democratic right to pursue de-amalgamation, we also have to be realistic about some of the challenges this brings.

“It’s why one of my main priorities as Local Government Minister has been to find a way to remove the roadblocks posed by the existing demerger process, and give communities the opportunity to decide.”

Under the changes, councils wishing to de-amalgamate must develop a robust business case upfront. This must consider the financial impacts and council’s ability to fund de-amalgamation, long-term strategic plans and the service delivery capacity of the new demerged councils.

Councils will also be required to undertake community consultation on the business case.

Upon receipt from a Council, the Minister must forward a business case to the NSW Local Government Boundaries Commission.

Following a subsequent independent review by the NSW Local Government Boundaries Commission, the Minister may then approve a constitutional referendum with a compulsory vote, which would require majority support from local electors to proceed with a de-amalgamation.

In addition, the Government’s Bill provides transition arrangements for councils which have already been approved for demerger by the Minister.

“These amendments the Government has introduced provide a clear path forward for councils wishing to de-amalgamate, providing much more clarity for current and future proposals,” said Minister Hoenig.

“However, it’s essential that local democracy is enshrined in the decision-making process so that councils and communities are fully informed of the financial and other implications of de-amalgamation.

“The amendments we have introduced are more pragmatic than other legislative proposals being put to Parliament and ensure de-mergers can be effectively managed by councils and that any new councils are financially sustainable.”

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