KPMG report paints a strong case for super South-East council with savings of $7.6 million a year

THE creation of a single council from the municipalities of Clarence, Tasman, Sorell and Glamorgan Spring Bay would save $7.6 million a year, an independent report has found.

Local Government Minister Peter Gutwein wants the four south-east councils and their communities to consider all options posed in the new KPMG report. Picture: LUKE BOWDEN

THE creation of a great southeastern council from the municipalities of Clarence, Tasman, Sorell and Glamorgan Spring Bay would save $7.6 million a year, an independent report has found.

The KPMG report studied five options for mergers between the four councils, with a complete merger expected to create the most savings.

Merging Clarence, Sorell and Tasman would save $6.3 million, while an amalgamation of Glamorgan Spring Bay, Sorell and Tasman would save $2.5 million. Sorell and Tasman councils have been included in all modelling options, with a merger between just those two councils predicted to save $1.2 million.

Most of the savings would come from reduced employment costs. The fifth option – retaining the status quo but increasing shared services – would save $920,000.

MORE: $1.2 MILLION SAVING FROM SHARED SERVICES

Local Government Minister Peter Gutwein said he believed the report set out a compelling case for the conversation surrounding council mergers to continue.

“The report very clearly indicates that there are options that would be in the best interests of ratepayers to proceed with,” Mr Gutwein said.

“The full amalgamation option offers the highest level of savings, but these are matters to be considered by the individual councils.

“By the end of the year I would hope that all councils are in a position where they could make a decision as to whether or not we take the next step, which would be to have a conversation fully with their communities.”

From left, Glamorgan Spring Bay Mayor Michael Kent, Sorell Mayor Kerry Vincent, Tasman Mayor Roseanne Heyward and Clarence Mayor Doug Chipman at the release of the KPMG report. Picture: LUKE BOWDEN

A great southeastern council comprising all four municipalities would have a population of 75,500 people. The total one-off cost estimated to complete the merger for that option was $6.3 million.

There would be an additional surplus per rateable property of about $170 per year. An amalgamated council could decide to pass this saving to ratepayers, or use it for council business such as works.

The report is based on the assumption that rates remain the same, however an amalgamated council would make the final call on rate levels.

The report also considered a district or ward-based electoral system, where voters would elect representatives for their specific area inside the municipality to ensure smaller communities continued to be represented.

Tasman Mayor Roseanne Heyward said she hoped job losses stemming from a merger would be minimal.

“The staff losses are a huge concern, and we will be hoping that is not too big an issue for us,” she said.

“I think people are expecting some action, but what our councillors and what our ratepayers will say about that is a whole different conversation.”

WHAT A SUPER COUNCIL WOULD MEAN FOR STAFF: The four councils employ about 480 total staff. Mergers would reduce the duplication of some roles. Redundancy costs are estimated at $2.7 million. FOR SERVICES: The report was conducted assuming council services would be unchanged. FOR ELECTED MEMBERS: Under option one, 36 councillors would be reduced to 15. FOR RATEPAYERS: The report estimates a $170 additional surplus per rateable property under option one. That could be passed to ratepayers or used for works.

Clarence City Council also has participated in modelling for a greater Hobart council, which is expected to be released before Christmas. Clarence Mayor Doug Chipman said he would expect public consultation to be completed in the first half of next year.

“At this stage it’s premature to say exactly where we ought to be going,” Alderman Chipman said.

“The implications for each community need to be considered very carefully so people understand what they are getting into. First of all the community has to be satisfied that it’s in their interest, and that’s the foremost consideration.”

Sorell Mayor Kerry Vincent said the KPMG report would provide his council with a better understanding of how it could better co-operate with neighbouring municipalities.

“I think most people in the community are conscious we need council reform,” he said.

“Sorell is in a fairly unique position because it is the centre of the South-East region, so we do have a working relationship with all those three [other] councils.”

Glamorgan Spring Bay Mayor Michael Kent said he thought rural councils would “continue to struggle” under the status quo.

Property Council Tasmania executive director Brian Wightman said there were “no excuses left” for State Government MPs not to support amalgamations.

“$7.6 million per annum in savings cannot and should not be ignored,” Mr Wightman said.

“It’s time for reform, and it’s time for our political leaders to act in the best interest of ratepayers by working together to ensure that council amalgamations become a reality.”

Mr Wightman said polling done in June showed 70 per cent of respondents agreed 29 councils was too many.

The KPMG report was based on assumptions that there would be no changes to services, no changes to rates, no changes to community facing staff, and that local shopfronts would be retained.

The four councils are expected to discuss the report during their October meetings and would seek feedback.

Meanwhile, shared services saved seven Tasmanian councils $1.2 million last financial year, Local Government Shared Services said.

An agreement between seven Tasmanian councils and five Northern Territory councils saw 14,000 hours of work exchanged during 2015-16.

Glamorgan Spring Bay Council has recently joined the organisation, alongside Brighton, Central Highlands, Glenorchy, Glamorgan Spring Bay, Huon Valley, Sorell, Southern Midlands and Tasman councils.