LOCAL GOVERNMENT AMENDMENT BILL 2021

Second Reading Debate

Ms JODIE HARRISON (Charlestown) (18:06): I speak on the Local Government Amendment (Rating) Bill. I thank the shadow Minister, the member for Campbelltown, for the extensive work he has done to bring forward amendments to make the bill acceptable to the Opposition and also for the consultation he has undertaken with all stakeholders. I would be remiss not to recognise today the hard work of councils across New South Wales that are working incredibly hard to ensure that their local roads and infrastructure are safe during the heavy rains, winds and floods we are currently experiencing. Along with the SES, Fire and Rescue NSW, surf lifesavers, police and charities such as the Salvation Army and the Red Cross, local councils are at the coalface right now, working hard to keep our communities safe.

I note that the bill has been introduced primarily to implement recommendations from the Independent Pricing and Regulatory Tribunal's [IPART's] review of the local government rating system. But it does not implement all of the IPART's 42 recommendations—13 have been supported and only five adopted. The provisions of the bill have travelled a long and winding road to this place. In August 2016 the IPART released its draft report and it was presented to the Minister in December of that year—it was a different Minister at that time. One Premier, three Ministers and an election later the final report was released in June 2019. It has taken nearly a year for the Government to get its act together and to deliver a response. The delay of the release of the final report is highly questionable, as is the fact that an explanation for the length of the delay has never been offered.

However, finally the day has come. Minister Hancock is now at the helm and the bill is before us. In local government there are many stakeholders and there would have been much navigation of positions to do. However, this Government's dabbling in reform of local government, certainly since 2011, has been haphazard—whether it be offloading infrastructure in need of repair to local governments as a form of cost-shifting or bungled amalgamations. This bill is no different. Elements of this bill can be salvaged, but Opposition colleagues and I have tremendous reservations about its provisions. The bill will allow for a process outside of IPART with regards to special rate variations for intergovernmental projects.

The Government suggests that this will enable more communities to benefit from improved infrastructure, but I see it as a blatant attempt to bypass the independent umpire. IPART was set up to administer a system of checks and balances on proposed pricing of New South Wales Government instruments, including councils' rates increases. Ratepayers might not always agree with IPART's determinations but that system is designed to be transparent and reasonable, balancing the views of all stakeholders. The proposed provision will do away with that process. The current process for review by IPART of a council's special rate variation may well be long and cumbersome, but that does not mean that the IPART review should be abolished. Instead, it means that IPART should be given the resources to undertake those reviews in a timely manner. We owe it to the ratepayers of every council across this State.

Let us turn back to this Government's hasty and ill-considered scheme to amalgamate local governments, the so-called Fit for the Future program, and the ramifications it has had for the impacted communities. I was mayor of the City of Lake Macquarie Council when this Government suggested amalgamating the City of Newcastle and Lake Macquarie City councils: a merger that would have created a sprawling local government area stretching from Stockton to the Central Coast and cost staggering sums of money. Newcastle is a very different place from Lake Macquarie. Lake Macquarie's mix of urban, rural, semi-rural and village design would not have meshed well with Newcastle's much more urban character. Trying to deliver services to 360,000 people across such a diverse area would have been next to impossible.

Independent financial analysis from PricewaterhouseCoopers reinforced Lake Macquarie City Council's view that the proposed merger of the City of Newcastle and Lake Macquarie City councils would have been much more expensive than letting Lake Macquarie council stand alone. The proposed merger was estimated to cost $47 million over the transition period and $28 million per year afterwards, with a corresponding rate increase of more than 12 per cent for Lake Macquarie council's ratepayers. Some 87 per cent of the Lake Macquarie City Council's residents opposed the suggested amalgamation. Though the Government eventually listened to reason and backed down on the merger, that it was even suggested underlines the Government's commitment to politics and ideology over sound policy.

As it stands, the bill will give the local governments created as a result of forced amalgamations four years to harmonise different rating systems brought by amalgamated councils. That time frame is simply not long enough for many ratepayers. Once again the Government is trying to rush through changes when communities should be given time to adjust. I believe, and as the shadow Minister and previous speakers on this side have outlined, the proposed time frame should be increased considerably to give impacted communities a reasonable time to adjust. There should also be a legislated process for de-amalgamation, for use when the Government's merger experiments prove unsuccessful. The creation of a business case process for de-amalgamation proposals is necessary, and there should be time limits imposed on the Minister for Local Government to ensure a proper and timely response. The delay between the release of IPART's report and the Government's response makes clear that this Government is not above putting off dealing with inconvenient issues. This bill should make sure that it cannot do that again. As I outlined, the cost of council mergers could be astronomical, which is why the Opposition wants to see the creation of grants of financial support specifically to offset these costs for forcibly amalgamated councils.

The bill has one provision that I welcome but I do not believe it goes anywhere near far enough—namely, the provision to provide councils with the option to make superannuation contributions to councillors in addition to the payment of their fees from 1 July 2022. My experience is that many people do not understand that the role of a councillor is not a full-time role, unlike in our neighbour State to the north. Mayors or councillors who are doing their jobs properly put in a huge amount of hours for the allowances they get. The vast majority of people will quite reasonably assume that superannuation is paid to councillors and mayors for doing their jobs. Linda Scott, the president of Local Government NSW and recently of the Australian Local Government Association—and I congratulate Linda—recently said, and I quote:

We know that councillor remuneration is a significant factor in encouraging more people – particularly women and younger people – to serve on their local council; which is why we have worked with the sector to ensure these needs are met … mayors and councillors should be entitled to receive superannuation "in line with every other Australian employee."

And I could not agree more. I recognise that councillors and mayors are not employees of councils in the legal sense, but nor are we in this place employees of the New South Wales Parliament. Yet we still receive superannuation as any employee does. It is exactly the same logic, and councillors and mayors should not miss out on superannuation contributions simply because they have put up their hands to serve their communities in local public office. Councillor Scott went on to say:

… the NSW Government has finally recognised the need for elected councillors to have the same superannuation rights as other women and men in the workforce.

For too long people considering running for elected office in local government have been unable to do so unless they were independently wealthy. This reform will enable more people to consider running to be a mayor or councillor, and this is a welcome step forward.

She is right. Our communities will benefit from having people with a diversity of backgrounds, viewpoints, priorities and experiences stand for and be elected to local government. There is evidence all over the Hunter of how badly things can go when only the independently wealthy are able to have a tilt at local government. The image of brown paper bags full of cash being handed over in the back seat of a Bentley has become a symbol of corruption in the Hunter. Only yesterday we saw the release of the ICAC report on Operation Dasha, which made recommendations of criminal charges against not only Daryl Maguire, the former Liberal member for Wagga Wagga, but also Michael Hawatt, a finance broker and ex‑councillor of Canterbury City Council, and Pierre Azzi, a Canterbury councillor and project director at a property and infrastructure consulting business.

Superannuation for all mayors and councillors is vital to boosting the representation of women in elected local government office. I know the Minister is keen to increase the number of women serving as mayors and councillors in New South Wales, which she has spoken about on multiple occasions. Women make up more than half the population of New South Wales but occupy only one in three seats on local councils. As Councillor Scott put it:

Research shows that on average, women retire with 47 per cent less superannuation than men, so introducing superannuation to local government will allow more women to consider running to be an elected leader.

It is high time we addressed this imbalance. Let us mandate compulsory superannuation for mayors and councillors. Unless heavily amended, I cannot support the bill. I urge the Government to support the amendments that will be moved by the Opposition and shadow Minister. After years of mishandling local government policy, the Government has a chance to get things right.

This speech was part of a debate on the Local Government Amendment Bill 2021, which you can learn more about here. You can read the rest of the debate on Hansard.