The issue of local government amalgamation is back on the table following a call by the chair of the Bank of Melbourne, Elizabeth Proust, to slash the number of councils in Melbourne from 31 to one.

This isn’t an issue that’s specific to Melbourne. Metropolitan Sydney is administered by an astonishing 38 councils with a further five involved in managing urban overspill, while Adelaide has 19. The real standout though is metropolitan Perth, which, although it has less than half Sydney’s population, requires an astounding 30 councils in order to operate.

In contrast, south-east Queensland seems grossly under-administered. It has a population of 3.3 million and stretches from the Gold Coast to the Sunshine Coast — yet somehow it manages with just 10 councils.

One of those 10 councils is the City of Brisbane, the model of local government that most advocates of amalgamation want to emulate elsewhere. It was created in 1925 by the union of 20 councils and manages an area of 1367 square kilometres — roughly an 18-20-kilometre radius around the city centre — with 1.1 million residents.

While the lord mayor of Sydney is firmly under the rod of the state government over issues such as bike paths, the City of Brisbane builds and operates key transport, water and sewerage infrastructure. For example, Brisbane Transport operates over a thousand buses and constructed one of the world’s leading Bus Rapid Transit systems.

Things were far worse in Victoria prior to major reforms implemented in the 1990s under the Kennett government (when Proust was head of the Premier’s Department). The number of councils in the state was reduced from 210 to the current figure of 79 and the number in metropolitan Melbourne was almost halved.

The issue of amalgamation essentially comes down to the age-old tension between economies of scale on the one hand and the extent of local influence on the other.

The benefits of bigger councils are numerous. Depending on the size of the new amalgamated units, there’d be the usual savings that come with size, such as potential economies in management costs and efficiencies in the delivery of basic services such as garbage collection and planning approvals. There should be fewer border problems and vastly better co-ordination of policies and operations across many more suburbs.

Those efficiency benefits alone are enough to justify large-scale amalgamation. However, there should be significant additional benefits from the relatively greater weighting likely to be given to regional and/or metropolitan objectives — such as suburban densification — over localised concerns such as opposition to redevelopment within specific neighbourhoods and streets.

A large council might also have the credibility and resources to formulate and apply significant policy initiatives; to finance and construct major infrastructure; and operate large business units in its own right. It could make significant decisions optimised for its regional context rather than the whole-of-state perspective, with its attendant compromises, taken by state governments.

A large council would be more likely to focus on the big picture. The City of Brisbane has the wherewithal to invest in the sort of transport and water infrastructure it decides is in the best interests of residents. Of course, this doesn’t mean it would necessarily make the right decisions — Brisbane’s elaborate riverside freeway system was largely built at the behest of council.

The downsides of joining councils up mostly relate to the real or perceived loss of political influence by residents and the potential for local issues to be ignored. The City of Brisbane has 26 councillors (about one per 43,000 residents) whereas the City of Melbourne has 10 (one per 9300 residents) and the City of Sydney has 10 (one per 18,000 residents).

Get Crikey for $1 a week.

Lockdowns are over and BBQs are back! At last, we get to talk to people in real life. But conversation topics outside COVID are so thin on the ground.

Join Crikey and we’ll give you something to talk about. Get your first 12 weeks for $12 to get stories, analysis and BBQ stoppers you won’t see anywhere else.

Peter Fray
Peter Fray
Editor-in-chief of Crikey
12 weeks for just $12.