Rate Increases May Help Council Mergers

Mosman Council is making an application to the Independent Pricing and Regulatory Tribunal (IPART) to increase rates permanently by 5%.

Mosman's mayor's occasional enews says that 884 residents responded to the community consultation over rates.  31% wanted rates to go down, 34% to stay the same and 36% were in favour of a rate increase.  So the council has decided to apply for a rate increase not withstanding that 65% of residents wanted them to go down or stay the same.  So much for the consultation, but the councillors know what is in their own best interest, or do they?

Its all about Council mergers and securing the ramparts (see earlier post).

Interestingly IPART has previously reviewed and endorsed the governments Fit for the Future criteria and their latest guidelines seem to encourage councils to ask for increases that help them meet the Fit for the Future tests.

It is possible that as the NSW government cost shifts and reduces funding grants for councils, they are happy for rate payers to be taxed more at the local level.  And it will be easier to merge councils if they are financially stronger.

Struggling councils when merged make larger and weaker organisations, while merging financially secure councils forms larger and stronger councils, which don't have to raise rates as part of the merger process. Allowing rate increases above the rate cap looks looks like a long term win, win situation for the Government and a short term win for small councils.

Check out my other website http://mergemosman.com

Extract from P Abelson's occasional letter to residents

As most readers know, we have conducted a community wide survey on three rating options. These were (1) not to renew a special 5% levy that has been part of Council’s budget for 15 years (2) to apply to the Independent Pricing and Regulatory Tribunal for renewal of the levy which is essentially the status quo or (3) to apply for levy renewal plus 5% increase. We received 884 responses with in round numbers 31% favouring option (1), 34% favouring (2) and 36% favouring (3). My view was that this suggested that levy renewal plus 2.5% increase would be an appropriate council response. However Council’s Audit Committee argued very strongly that (3) was the most financially responsible action and would best meet the State Government’s “Fit for the Future” financial ratios and hence criteria for financial sustainability and Independence, and Council resolved to request IPART for option (3).

Time to be Realistic - Mosman Daily

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Time to be realistic

Mosman Daily
4 Dec 2014
THE NSW Government is requiring all councils to submit a proposal by June 30, 2015, outlining how they intend to become “Fit for the Future”. Mosman Council will fail its assessment, we simply do not have the required “scale and capacity”. We are the...read more...

Tech Tags: Mosman Daily newspaper NEWS

Paper Bags Full of Banknotes - Advice to Mosman Council

The Co-Chair of the 'Committee for an Independent Mosman' , Will Tuck, has written to the Mosman Daily putting the case against mergers. He postulates that the Independent Local Government Review Panel’s proposal to merge Mosman with our five neighbouring councils is some how related to the corruption of public officials. A bold assertion indeed.

'The real story is, who would you trust to manage your council? A government or opposition made up of MPs who take paper bags full of banknotes and back development against community interests, or an approachable council?  Mosman Daily 20 Nov 14.

The Committee for an Independent Mosman was created by the Council in July 2013.  This is how council website describes the committee.

'The purpose of this Committee is ensure Mosman continues to be an independent Council and not the subject of forced mergers by the NSW State Government. This reflects the overwhelming will of Mosman residents as evidenced in the September 2012 poll where approximately 80% of all voters expressed a desire for Mosman Council to remain independent.'

It seems wrong that the Council can setup  and fund an advisory committee with such a narrow brief. Shouldn't the council be considering a range of advice, shouldn't the council have a responsibility to act in the best interests of residents.

Lets hope that no one takes serious notice of advice from a consultative committee that thinks merged councils are going to be managed by MPs 'who take paper bags full of banknotes'.

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Rejection not selfish

Mosman Daily
20 Nov 2014
OK. LET’S do what the Premier wants with NSW Councils, swallow our pride and all merge. With Mosman Council, the suggestion is that it merge into a projected council population 900 per cent larger than now, or 270,000 people from the 30,000 that...read more...

Tech Tags: Mosman Daily newspaper NEWS

Ku-ring-gai Council Opens Discussions on Mergers

Ku-ring-gai Council has taken the wise step to open discussions with surrounding councils on voluntary amalgamations.  They intend to employ facilitators and other consultants as necessary to enable a report to be brought back to Council by February 2015. 

Councils have been offered financial and organisational support for merger talks under the NSW Government's Fit for the Future initiative.

Councillors voted 6 to 4 at last weeks council meeting to prepare a submission to the NSW Government demonstrating that Ku-ring-gai is 'fit for the future' without the need for amalgamation. But at the same meeting, the Council also voted to open discussions with surrounding councils on voluntary amalgamations.

Mayor Jennifer Anderson said the Council needed to remain flexible in its approach to the Fit for the Future reform package. "We will consider the implications of all the options on the table, bearing in mind the best interests of our ratepayers," 

Mayor Anderson also flagged one of the potential hot issues that will arise, she said. "Our financial modeling shows that higher rates will follow a merger with a Council that has lesser land values, such as Hornsby."  

No doubt this issue will also arise if Mosman and North Sydney councils start to have a dialogue. Every council has different rate formulas that will have be rationalised over time.

It is great to see a traditionally anti merger  North Shore council preparing to consider all options in the interests of its residents.

Mosmanly - a Text Book 'Red Herring'

'Straw man' and 'red herring' arguments are the stuff of high school debates and local politics.

In response to the 'Sampson Review' proposed merger of Warringah, Pittwatter and Manly, The mayor of Manly has suggested that Manly and Pittwater should each take over parts of Warringah Council, to take revenge and demolish the next door council that has been arguing in favour of amalgamations.

The mayor of Mosman supported  a merger between Mosman and Manly, Mosmanly, this being better than a merger between North Sydney and Mosman on the grounds that the two areas were both residential.   The Mosmanly proposal seemed to ignore the fact that Mosmanly council would be split in half by Sydney Harbour.

Both Mayors engaging in a classic 'red herring' argument, distracting and diverting attentions from the real issues.

Graham Sampson, chair of the ILGRP was recently interviewed by the Manly Daily. This is an extract.

We’ve been asked by the State Government to create a stronger local government sector, a combined northern beaches council taking in all three could be very strong. It could play a very important role in Sydney.” 

As for MosManly — a merger between Mosman and Manly — Mr Sansom said it was illogical. 

“We looked at the criteria for effective LGA boundaries and one of the features used commonly all around the world is a major waterway,” Mr Sansom said.
“Trying to make that death-defying leap across Middle Harbour to connect Mosman and Manly, we couldn’t see that as the logical way to go.

“Certainly there are some linkages between Mosman and Manly but the dominant link is between North Sydney and Mosman, then Manly with the northern beaches.”

No doubt we will see a few more of these distractions from our local mayors. The 'Straw Man' and Red herring fallacies are well explained in these two short videos.

Fix the Drains and Secure the Ramparts

Mosman Council recently called a public meeting to explain its plans to increase rates permanently by up to 10%.  There was suspicion that the proposed rate increases were in some way related to Mosman Council campaign against amalgamation.

drains feature highly in Mosman's future 

I was not looking forward to this meeting, imagining a gathering of fellow grey haired residents combing over endless columns of numbers and inspecting kilometres  of dilapidate drains.

Fortunately the Mayor's introduction was brief and to the point. He said the rate application was being done now ‘to get clear of any election’ and to ‘maintain independence’.

One of the rate increase options proposes a lesser increase of 5%, it is designed to replace an existing 5% Community Environmental Contract. The Mayor said ‘we can live with that’ ‘we are in pretty good shape anyhow’, ‘without the threat there would not be the will to go for extra 5%'.

One of the Councillors offered an assessment that we had a 50% chance of stopping amalgamations if the higher rates were approved.  He said ‘get ramparts secure, then we can make any argument we like’.

Mosman's iconic ramparts

At which stage the General Manager interjected to explain that the 'bureaucratic' reason for the rate increases was that 'the additional funds were needed to increase service levels particularly infrastructure renewal and maintenance and to achieve operating surpluses over the next 10 years.'

In response to a question about whether efficiencies could be gained from scale, a councillor said ‘resource sharing across councils in NSW had been pathetic and he hoped that when the amalgamation threat passes, it will trigger better resource sharing.  Someone rightly suggested mergers would solve this problem.

The event ended with a call for a round of applause for the staff and councillors.  The meeting was attended by 6 councillors, 6 council staff and 14 residents.

The suspect motives turned out to be well founded,  Mosman Council is looking to permanently increase rates beyond what is necessary to bolster its ‘fit for the future assessment’ all in the name of ‘An Independent Mosman’.

In the meantime the Government has released its Fit For the Future Templates.
The thresh hold issue is Scale and Capacity. Financial sustainability measures will only be assessed once this question has been answered.

Screenshot from guidelines

To read more see the guidelines for Fit For The Future.
http://www.fitforthefuture.nsw.gov.au/content/just-released-%E2%80%93-council-self-assessment-tool-templates-and-guidance

Mike Baird Could Have Said 'Put Self Interest Aside and Put the Community Interest First'

The NSW Premier Mike Baird recently addressed the Local Government Conference and was quoted by the SMH,

"How can we use this process to deliver better services and more infrastructure for our community? It's almost that sense of having to put pride into the back seat and put the community into the front seat."

I imagine the Premier was using the word 'pride' to diplomatically say put aside 'self interest' and put the community interest first.

I have now attended three community forums over the last year on the issue of council mergers and the same story emerges each time. The rooms are populated by people like me, grey haired, active in the community, well informed and well connected to existing council structures.  Every one upholds the virtues and achievements of their council, they say they know who to talk to and how to get things done. They fear this will all change if their council merges with its neighbour.

Sitting amidst the protest at an ILGRP consultation

Many meetings are addressed by former Mayors, Councillors and General Managers all speaking with fondness for their contributions to civic life, their involvement with their communities.

It is hard not to be sympathetic to these appeals.

The reality is however, that these very well meaning people, who are making a real contribution to their communities and current and past Councillors, have a strong interest in the status quo. They know how it all works, they know the right people, they have the established relationships, they hold local power and they don't want anything to change.

But we are not representative of the community, with our knowledge, contacts and relationships, we are a privileged and very small minority. Most residents would not know the name of their ward Councillor or the name of their council's General Manager.  They simply want cost effective services and representation.

This is the appeal the Premiere is making, it is in the interest of the community that councils merge, to have the capacity and scale to provide better services, become more efficient and better represent their communities.  So please put aside 'self interest' and put the community first.  Premiere Mike Baird is right on this occasion.

SMH Article: http://www.smh.com.au/nsw/premier-mike-baird-tells-councils-to-put-pride-in-the-back-seat-as-merger-talk-heats-up-20141020-118ktt.html#ixzz3Gkji53r6

Mosmanly

According to News Local, a plan to divide and conquer Warringah and include Mosman in a mega Manly Council is set to be discussed by Manly councillors.

http://www.dailytelegraph.com.au/newslocal/northern-beaches/manly-mayor-jean-hay-mulls-mosmanly-megacouncil-as-merger-pressure-grows/story-fngr8hax-1227085452264

Dubbed “Mosmanly” by Mosman mayor Peter Abelson, the mythical municipality would extend from Taronga Zoo to Curl Curl. Warringah Council would be dissolved, while Pittwater Council would control the peninsula’s north.

Manly mayor Jean Hay, who will put the idea to councillors, said the name might need some work “as we know Manly gathers no moss,” but that councils must consider mergers or face being frozen out of state and federal government funds.

Peter Abelson is quoted  'Council would prefer to remain independent but is under pressure to merge with North Sydney. Cr Abelson said a merger with Manly would be a “better fit” as both areas are residential.'

Really, you must still be joking! 

Cremorne is at the border of Mosman Council and North Sydney Council. It is a five minute bike ride from Mosman Council Chambers.  Mosman is separated from Manly by water in the form of Middle Harbour and the ever congested Spit Bridge.  

Willoughby councillor Angelo Rozos says benefits of amalgamation must be considered

Willoughby Councillor Angelo Rozos is quoted in this week Telegraph in favour of council amalgamations.  

He thought the suggested Willoughby Council, Lane Cove, North Sydney, Hunters Hill and Mosman  amalgamation was too big, but he could see merit in two councils for the area.

 “If amalgamation was to occur, the north shore should be divided into two – upper and lower,’’ Cr Rozos said.

He suggested a council made up of Lane Cove, Willoughby, some parts of Ku-ring-gai and Hunters Hill and a second council containing North Sydney and Mosman could result in cost savings.

The councillor said amalgamation would offer more services to the community and much better value for the ratepayer’s dollar.

“There seems to be a bit of a resistance regarding amalgamation, but we need to have that serious debate on the north shore. I am all for retaining local and independent council representation, but we need to get the balance right with financial responsibility for the long term,” Cr Rozos said.

read the full article here

http://www.dailytelegraph.com.au/newslocal/north-shore/willoughby-councillor-angelo-rozos-says-benefits-of-amalgamation-must-be-considered/story-fngr8h9d-1227054990093

In the meantime, Lane Cove Mayor David Brooks-Horn has named the issue as the biggest challenge his council would face in the next 12 months.
http://www.dailytelegraph.com.au/newslocal/north-shore/public-meeting-to-be-held-on-council-amalgamations-at-lane-cove-council-civic-centre-on-october-8/story-fngr8h9d-1227081624711

Lane Cove Council is holding a public meeting meeting at the Lane Cove Council Chambers, 48 Longueville Rd, Lane Cove from 7pm, Wednesday, October 8.

'Fit For the Future' with some measly pieces of silver

The NSW Government has announced its response to the Sampson Review  (media release) and it has not been well received by Mosman Council.

This is what the Mayor had to say in his 'occasional letter'.

'Secondly, the State Government has nearly done a full U-turn on its frequent pledges not to force council amalgamations. Councils have been told that by June 2015 they must come up with proposals for scale and capacity that are consistent with the recommendations of the recent Independent Local Government Review Panel (ILGRP) which recommended that council areas in Sydney should contain some 250,000 people. Councils are also being offered some measly pieces of silver (which works out at about $100 per household) to amalgamate. It is not clear at this stage what happens to Councils (communities) that do not wish to be part of huge local government areas or whether they will have the opportunity to show that they are “Fit for the Future”, whatever that may mean. If the review panel for “Fit for the Future” is similar to the ILGRP, whose three members were wholly pre-committed to amalgamation, it could be another hatchet job. I will provide more details as they become clearer. We will of course consult our community in setting our position.'

The Seven Things Keeping House Prices High

The Conversation recently published an article "The Seven Things Keeping House Prices High"

One of the seven is the fact that population growth is outpacing dwelling approvals.

Local Councils are seen to be slowing up approvals.

Something has to change.

http://theconversation.com/seven-things-keeping-house-prices-high-and-foreign-investment-isnt-one-of-them-31345

Reserve Bank Glen Stevens - Funding conditions are not an impediment to infrastructure

Sydney like most capitals in Australia is having a housing price boom and there is concern that we are in a boom bust cycle.  The problem is the shortage of land for development.  

Glen Stevens, Reserve Bank Chair, recently made this point albeit in a diplomatic way, 'monetary policy (very low interest rates) could not add to the amount of land available for housing or improve the ability of the construction sector to respond to demand for extra housing.'  'Funding conditions are not, in fact, an impediment to infrastructure.'

For the sake of the economy and the need for affordable housing for an extra 2 million people, the State and Federal Governments must make a priority the release of development land. The problem is local government and small councils which are captive to anti development local politics.

Mosman Council is a prime example, having refused to endorse its own Spit Junction Master Plan, because of fears of an residents backlash to building heights going from 5 stories to 7 stories in a few highly selected places.  The master plan recommend higher building heights and increased FSR (2.5 to 3.5) to allow for  public amenities in the form lane way setbacks, public arcades and bus terminals.

The State Government funded the Spit Junction Master Plan, they must now be shaking their heads in disbelief.  The obvious solution from their point of view, make councils larger  and more responsible.

Extract from Glen Stevens speech reported in the Fin Review

http://www.afr.com/p/national/rba_glenn_stevens_urges_action_to_zQDQkxTeiTKlXdg9qXSN8H

“It is stating the obvious that at present, while we may desire to see a faster reduction in the rate of unemployment, further inflating an already elevated level of housing prices seems an unwise route to try to achieve that.” Mr Stevens indicated to a function organised by the Committee for the Economic Development of Australia in Adelaide on Wednesday that it was the task of state and federal gov­ernments to help ensure price gains didn’t become unsustainable.

He said monetary policy could not add to the amount of land available for housing or improve the ability of the construction sector to respond to demand for extra housing.

“Other policies have to do that – and it’s important that they do, if we are to see easy credit result in more dwellings as opposed to just higher prices for the existing dwellings,” he said. “Monetary policy can’t create the additional in­frastructure that most people agree we need. Funding conditions are not, in fact, an impediment to infrastructure.

Housing Projections for Mosman

The NSW Department of Planning has released housing projections for all NSW LGA's.  For Mosman they are predicting an increase of 7,800 people over the next 15 years.  This will require 3,250 additional dwelling over this time.  This means more than 200 new dwellings need to be approved and built each year.

It is yet to be seen how Mosman Council will respond to these figures which are projections at this stage and not targets.

Mosman Council recently rejected the draft Spit Junction Master Plan which it commissioned in 2011. The NSW Government paid more than $200,000 for the consultants to prepare Master Plan.

Read more at http://www.planning.nsw.gov.au/projections

This is a screenshot of one of the Dept of Planning webpages.

Department of Planning Projections
Current Mosman population 27,550  projected to be 35,350 by 2030.
Current dwelling 13,750 projected to be 16,900 by 2030.

Committee For Sydney Calls for Council Amalgamations

The Committee for Sydney says we ""must overcome the lack of metropolitan leadership and disjointed approach created by a multitude of small local councils and poor coordination across government."

"We know already some of what we need to do. We must grow in a way that improves the liveability of the city.  We must fix Sydney’s infamous urban sprawl that causes some of us to commute for up to 90 minutes each way every day. We must explore ways to make Sydney’s housing more affordable and put jobs closer to where people live. We must work towards a model where all Sydneysiders have an opportunity to benefit from Sydney’s growth."

Read their arguments on the Committee Sydney website  click here or see the piece in full below. 

The Future of Sydney Lies in Our Hands: staying Australia’s no:1 city

02 May 2014

On current trends, Melbourne overtakes Sydney as Australia’s biggest city in 2053. As we find it hard to believe that Sydney can continue to be Australia’s global city while being No 2 – or that Sydneysiders want that to happen – we believe that there needs to be a dynamic response from government, business and the community to this wake up call. We can and must remain the nation’s No 1 city but only if we take radical and concerted action now.

Melbourne is growing faster partly because it has managed to ensure its housing stays more affordable. Melbourne also has more jobs that are accessible within an hour’s travel. To add insult to injury, Melbourne – aided by local council amalgamations and greater collaboration between tiers of government - has a long term plan that sets out just how they’re going to beat us.

Sydney is growing. It’s just doing so in a haphazard way and without a coordinated vision, supported by its citizens, that embraces our growing population needs, our economy, our infrastructure or even the basic liveability of Sydney. We have no strategy in place to stay No 1. And with our 40 councils there is no single voice or forum for Sydney through which a ‘One Sydney’ vision and strategy can be developed.

We need to get our act together like we did for the Olympics. We must develop a vision for Sydney at mid century that plans for a vibrant yet balanced city of almost 7 million.

A Sydney 2054 strategy, developed collaboratively across all tiers of government and capturing the imagination of Sydneysiders, must overcome the lack of metropolitan leadership and disjointed approach created by a multitude of small local councils and poor coordination across government. Business-as-usual will not keep us No 1, something we believe our new Premier gets.

Our strategy must be ambitious and coordinated. It must integrate jobs, liveability and urban development, transport and housing connectivity, productivity, social participation, governance and infrastructure investment.

It must bring together the west and the east of Sydney in a ‘One Sydney’ approach. Only then can we create a prosperous and equitable Sydney that deserves its title as Australia’s Global city.

So we are creating a Sydney 2054 Taskforce comprised of experts across a wide range of specialisms and united by ambition, a global mindset, a passion for Sydney and an urgency around creating a sustainable 2054 vision for a global Sydney. And because we are developing a vision for our city for 40 years from now we have provided the Taskforce with a sounding board of Sydney’s Future Leaders. We urgently need the ambitions and new thinking of our talented young leaders to put Sydney on the right path.

This vision will not be ‘more of the same but bigger’. Sydney must be better as well. We must capitalise on innovation in new economic sectors and the incredible assets Sydney and its people offer. We must ask the questions that others are not and understand the key forces and policies which will drive Sydney to greater success - and the key barriers to overcome. Above all, we need to challenge traditional thinking.

While this initiative will be led by the Committee and its members from business, community, private sector and government, it is not confined to them. We want the community of Sydney to shape this strategy. So we will call for evidence and involvement from all those across Greater Sydney who share our passion for Sydney and a determination to make it even more successful.

We know already some of what we need to do. We must grow in a way that improves the liveability of the city. We must fix Sydney’s infamous urban sprawl that causes some of us to commute for up to 90 minutes each way every day. We must explore ways to make Sydney’s housing more affordable and put jobs closer to where people live. We must work towards a model where all Sydneysiders have an opportunity to benefit from Sydney’s growth.


This is an opportunity to create the future of Sydney, and that future lies in our hands. Hands up those who want to be No 2? We didn’t think so either.


by Dr Rob Lang, Chair of the Committee's Sydney 2054 Taskforce and former CEO of Parramatta City Council;

Lucy Hughes Turnbull, AO, Chair, Committee for Sydney; and

Dr Tim Williams, CEO, Committee for Sydney

Crikey's Alan Davies Points To The Elephant In The Room

Alan Davies, Crikey's Transport and Urban Development Consult and Urbanist blogger has pointed to the elephant in the room, small councils hold up unit devopments exacerbating the affordable housing problem in Sydney.

This is a extract from an excellent article.

http://blogs.crikey.com.au/theurbanist/2014/02/26/are-there-too-many-councils-in-australian-cities/

"There are a number of potential benefits from amalgamating Councils. One is economies of scale in management and in providing services that benefit little from highly-localised administration e.g. rubbish collection, recycling, pet registration. 

With fewer Councils there’d also be fewer border problems where Councils adjoin. There’d be better coordination of policies and operations acropolitan-scale implications of planning and heritage decisions. 

The ability of residents to improve the value of their properties by suppressing multi-unit developments in their neighbourhood would likely be weakened if Councils were larger. At present, resident opposition to development has a deleterious effect on housing affordability in established suburbs. 

But that also highlights one of the disadvantages of amalgamation; it would weaken local representation and increase the distance between residents and those making decisions about their neighbourhood.

A larger Council would spread the benefits of a key revenue source like CBD businesses across a larger population rather than spending disproportionately on gold-plated facilities for a relatively small number of residents."

Government have already taken some steps to take Council out of the process for approving larger scale unit development with planning approval powers for $20M developments now lying with Joint Regional Planning Panels.

A prime example of a council going slow is Mosman Council, which is not supporting its own master plan for  Spit Junction despite this long overdue urban renewal project being right next to the council chambers.  There just seems to be no political will at the Council to provide the necessary leadership.
http://www.mosman.nsw.gov.au/planning/spitjunction

Submissions can be made on the final recommendations of the Panel and Taskforce and the next steps for local government reform.  Reports are here.

http://www.dlg.nsw.gov.au/dlg/dlghome/dlg_GeneralIndex.asp?areaindex=REPORTS&mi=50&ml=1

Submissions close on Friday, 4 April 2014

Report Recommends Amalgamations Or Joint Organisations

The ILGRP report was made public in the second week of January 2014 and can be downloaded here.

The committee has maintained its view that councils should amalgamate. It  recommends that Hunters Hill, Lane Cove, Mosman and North Sydney, parts of Ryde and Willoughby Councils amalgamate or form 'Joint Organisations'

However, the NSW Government has reiterated its policy of no forced amalgamations.

The ILGRP has proposed a mechanism for councils or rate payers to ask the Boundary Commission to look into specific amalgamations.

This is a map of the ILGRP's recommended amalgamations.