Hilltops Council news: The true cost of those council mergers

The council met this week to consider the first budget since elections. The harsh reality is about to set in for councillors and ratepayers so it isn’t going to be easy. The shires of Harden, Boorowa and Young were merged by the NSW Government because they didn’t meet sustainability requirements.

They were unable to show sufficient cash reserves to meet long-term needs for asset replacement to build new roads, sewerage works, stormwater and other assets such as sorting facilities, caravan parks and so on.

They could have avoided a merger if rate revenue was sufficient to pay for these major asset classes, but the three councils didn’t meet this metric either. So, the state government merged three “broke” councils with all the associated upheaval to staff and operations, and now we are in the invidious position of trying to resolve the situation.

The budget for the merger was $5.0M, but the actual cost was up around $7.6M with no government commitment to pay the deficit. It will come as little surprise that the new Hilltops Council isn’t going to be in a position to meet the long-term asset replacement needs of the community either. At the same time, the government is handing out money for projects, which by and large the community will benefit from. Once built however, the council will pay to maintain these assets as well.

As most ratepayers know, the council doesn’t pay for these, but ratepayers, who pay increased rates or alternatively receive a reduction in service. It would be far better for the government to work with the councils it forced to amalgamate and allocate the necessary funds (along with a sustainable plan) to ensure the assets renewal or infrastructure backlog was addressed.