Local Government Magazine

The dangers of de-amalgamation

Ricki Bruhn, executive committee member of LG Professionals Australia

Ricki Bruhn, executive committee member of LG Professionals Australia, says any council looking at de-amalgamating could learn some valuable lessons from experiences in Australia.

In an interview with Local Government Magazine Ricki Bruhn cautions officials to do some rigorous financial modelling first “to make sure the entities created can survive on their own without the backing of government”.

Ricki is CE of the City of Palmerston in Australia’s Northern Territory. He says that ongoing funding shortfalls continue to dog both the Victoria Daly Regional Council and the West Daly Regional Council since they were formed through de-amalgamation in 2014.

They formerly operated as one council known as the Victoria Daly Shire Council which had been created as part of a large-scale amalgamation programme in the Northern Territory in 2008.

Since their 2014 separation, he says the two councils struggle to function.

“The split in services, staff, plant, machinery and infrastructure has made it difficult so now the Northern Territory government has to subsidise both of those councils so they can continue to exist.”

He estimates subsidies now run to around A$5 million each year.

Both councils cover large areas with small populations.

Victoria Daly Regional Council covers an area of approximately 153,000 square kilometres with a population of just 4500 including the five indigenous communities and surrounding outstations of Kalkarindji / Daguragu, Nauiyu / Daly River, Pine Creek, Timber Creek and Yarralin.

West Daly Regional Council covers 14,000 square kilometres and has a population of just over 3000 throughout the communities of Wadeye (Port Keats), Peppimenarti (Peppi) and Palumpa.

Ricki says it would have been obvious from the start that this particular de-amalgamation would create a need for ongoing additional government funding and suggests it was motivated by a need for government to win the bush vote.

In contrast, he says several other de-amalgamations in Queensland with larger communities have worked well.

This article was first published in the November 2016 issue of NZ Local Government Magazine.

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