Beyond Federation

Albury, July 19 & 20, 2003

"Visions, not Divisions"

Catherine Moore, Australian Greens

Thankyou to everyone for coming and for the opportunity to put the Green view.

With the NSW State Government's recent threat that amalgamations will happen, despite its pre-election promise that none would be forced, and submissions on this matter due with the Boundaries Commission by August 31, there is no better time to talk about the importance of local government, and I thank Mark and Max and the other organisers for their hard work and dedication in getting this conference happening.

I also acknowledge the Wiradjuri people, and people of other nations in the region, on whose land we are meeting today and whose traditional area has little relation to the artificial boundaries we created when we became a federation.

This congress is entitled How Australians Continue to Suffer from Cross-Border Anomalies, Inconsistent Laws and Standards, and Other Deficiencies, and Visions for a Better Australia. Well, the title of this talk is "Visions not Divisions". I am going to focus on the importance of local decision-making, how we might look at solving some of its existing problems by applying Greens policy, and a vision for a future system whose emphasis is on the local.

Within this group, which looks beyond federation and whose common goal is the abolition of state governments, there are varied opinions about what size the governments that we would keep, or create as part of the shedding of that tier, would be. Some argue for regional government based on catchments or other geographical features to replace the local government structure we have at present; others prefer local government as it is now. No matter what you believe, it can probably be agreed that there is no ideal size for a local government area.

While I agree that regional structure suits certain administrative and practical purposes, I do not believe that actual government of this size will ensure the democracy and efficiency that so many people are looking for.

One of the four core Green principles is grassroots democracy. The Democracy section of Greens national policy contains three policies - Democracy and Constitutional Reform, Local Government, and Community Participation in Government.

The first of these three policies states:

The Australian Greens:

  1. recognise the need for redistribution of powers amongst the spheres of government, generally to strengthen the power of the federal and local/regional spheres;

  2. support the eventual abolition of the States; and

  3. will actively promote debate on the definition and roles of local, bio-regional and federal spheres of government and organisation and on the need for global citizen- based democratic structures.

The introduction to the Local Government policy states:

The Australian Greens believe that fundamental changes to the structure of government are vital if we are to achieve true democracy in this country. If government is to be of, for and by the people, it must start at the local level and it is at this level that the power must remain.

Local government should be recognised in the Australian constitution.

Whatever the final shape of the reorganisation of the Australian system of government, the Australian Greens recognise and support the preservation of a system of local government which reflects the desire for local community identity and self-determination. We believe that power should reside in the most localised sphere of government that is able to deal with each issue.

The Australian Greens condemn:

  1. large-scale enforced amalgamations;

  2. unelected commissioners replacing elected representatives;

  3. councils being used as vehicles for implementing economic rationalist policies;

  4. the reduction of councils to the level of enabling authorities; and

  5. councils moving away from the provision of services towards merely deciding who will win the tenders to provide these services.

We are not alone in our belief that small, local government is the best way of ensuring democracy and efficiency. There is clearly widespread community feeling that we must keep our local government areas the way they are, however since the recent statements about amalgamation by the State Government, people are feeling that they have already lost the battle to do so.

This became obvious last week, when I attended a public meeting in Braidwood hosted by my own Tallaganda Shire, which borders Eurobodalla to the east, Yarrowlumla to the north and west, and Cooma-Monaro to the south. These are all distinct local government areas with their own set of local issues, many of which are inevitably similar, but none of which would receive adequate attention if they were to merge with the shires around them. Tallaganda Shire is one of the smaller ones, with ratepayers numbering about 2,800.

Despite the chilly night, the meeting was attended by well over 100 people, comprising a broad cross-section of the community. And the community is a diverse one. Originally essentially a farming community, there are now people from many different places, with diverse interests and talents, and the conservative population is starting to be diluted by more progressive interests and ideas.

The Council, however does not reflect this diversity.

The general manager, on behalf of the Council, presented a number of options relating to amalgamation for the meeting to consider and choose from. The first, preferred option, put and seconded by two councillors, was that Tallaganda Shire stay as it is, with no changes to its boundaries.

The Council staff, minus management, then gave their own presentation, and it stated that while in principle staff agreed that we should keep our existing boundaries, this wasn't going to happen, so it would be better if we suggested a new council area which included some of the council areas to our north and west. At the same time the staff acknowledged that we would probably be worse off because, for example, staff might have to travel away from Braidwood to work and ratepayers might not have the access to Council services that they enjoy now. It was also pointed out that unless we reverted to a riding or ward system, such as we voted to abolish at the Local Government elections in 1999, we would also find ourselves without representation in this new, larger council, given our smaller population base.

It was interesting to listen to the comments being made quietly around me, and observe the vibe that was beginning to develop. The councillor who put the proposal that we stay as we are had nothing good to say about our newly elected local member who, for the first time in living memory, is ALP. This very quickly lost the support of at least half of those in attendance, whom I believe would have wholeheartedly supported the option if he had stuck to the issue and spoken strongly about why it is important. There is after all, so much to say that is sensible in relation to why we need to hold onto our local democracy, but one of the problems we face in all spheres of government, though perhaps more so in the state and federal spheres, is that elected members tend to focus on personalities rather than issues, and forget civility, common sense and logic when putting forward their arguments. Respecting diverse views is a major part of doing politics differently, and voters would be far less cynical about politics and politicians if they saw a little more of that.

But back to the meeting. Interestingly, this unrest and unease about the comments being made seemed to remind people that they are intensely dissatisfied with the performance of our council and its general manager, (a situation not unique by all reports, to Tallaganda Shire) and that provided more encouragement for people to go with the staff option.

From the floor, I spoke in favour of the first proposal, and against the idea that the submission to the Boundaries Commission include a fall-back option based on an acknowledgment that we have no hope of standing up to the State Government and keeping our existing boundaries anyway.

It seems to me that if we give up now, we have no hope. A submission which provides the Boundaries Commission with two options will give it exactly the opportunity it needs to take away our council. If we are serious about holding on to our democracy, we need a concerted effort by many shires to say no to the State Government at this stage on this matter. No matter what we here today think about regional versus local, I believe that we should be strongly resisting all attempts made by the State Government to change our local government boundaries, and a strong campaign with lots of participants will be the only hope we have of doing this.

Anyway, when it came time to vote (of course there was consensus decision-making at this meeting) there was I, with a Green colleague beside me, voting along with the most conservative people in the room in favour of Option One. It was close to an historic moment and did not go unnoticed - we had to laugh when some of the conservative voters were almost hesitating when it became clear who was voting with them.

The idea that many people are unhappy with the performance of their councils and see amalgamation as a way of improving the situation is a worrying one. It is a bit like pulling down the house because a window is broken, and we need to separate our feelings of dissatisfaction from ascertaining whether our quality of life and access to democracy would actually be improved by amalgamation. Clearly getting rid of existing councils in favour of larger ones will not solve the problem.

Why is small local government preferable to larger regional bodies? I would like to quote now from Professor Percy Allan's presentation (thanks Mark) to the Local Government Conference in Armidale in February of last year.

He says that

Small is beautiful. That residents want

Large is necessary (for some things)

but that most council functions do not need to be big to be efficient.

However some functions benefit from size (e.g. works and maintenance, rates and payroll processing, data-base management.)

And why is small beautiful?

Smaller councils:

I would add here that smaller councils also give local people a better chance of being elected to represent their local community, therefore giving a voice to local issues which, if they don't have receive attention there, have no hope of adequate attention in a less local sphere.

And what about the

Legacy of (previous) Amalgamations?

Victoria – Promised 20% savings, got only 8.5% which was mainly from compulsory competitive tendering, not mergers. Public backlash.

South Australia – Promised 17.4 % savings, got only 2.3%. Rates escalated after temporary freeze. Public disenchanted.

Tasmania – Shift from tiny to medium sized councils had mixed results. Further attempt at achieving bigger councils backfired. Public backlash.

Efficiency and Size - Theory

Why do large organisations exist?

Ronald Coase said in 1937 that large organisations, such as companies, make sense when the “transaction costs” associated with buying things on the market exceed the fixed costs of establishing and maintaining a bureaucracy.

Efficiency and Size - Findings

G.A. Boyne said in 1992 that

"Concentrated structures were associated with higher spending than more fragmented local government and that there may be diseconomy of scale factors operating that outweigh the technical benefits of larger units.”

and

M. Jones (1993):

"It was once thought that small local governments allowed more community control but were more costly than larger units.

"Now the view is that smaller units are the most democratic and participative, and also the most efficient.

"Research shows that larger units tend to spend more per head than smaller units, even with the same general population characteristics."

R. J. Oakerson (1999):

"Fragmentation is associated not with higher, but with lower local government spending per capita. Numerous empirical studies have found this relationship. Moreover the relationship holds up when indicators of public demand for services are controlled, supporting an inference that fragmentation is positively related to efficiency."

Democracy or Efficiency?

Traditional schools of thought:

Bigness (efficiency) versus Smallness (democracy).

False trade-off: Bigness impedes both democracy and efficiency.

Local Government Reform -Traditional View

Expect the State Government to either:

Local Government Reform -The Third Way

Find a solution that addresses both:

Big v. Small: How others resolve the conundrum

American Union Movement

Small local unions with only a few hundred members offer full services because behind each is a shared service centre that provides them with membership processing, collection of dues, specialist legal advice for employee contract negotiations, newsletter production, discount deals, etc.

Government Departments

Within the NSW Government several small departments have banded together to buy their administrative support (e.g. records, accommodation, purchasing, fleet management, HR, financial management, etc) from a Central Corporate Services Unit located in the Department of Works and Services.

Big v. Small: Conclusion

If other spheres of private and government activity can achieve efficiencies without amalgamating existing independent operations surely the same can be done in local government.

Local Government Reform: the way forward

A three step plan:

    1. Democratic Choice;

Citizens should be free to decide what size municipality they want.

    1. Joint Service Centres;

Councils be required to transfer those services that would benefit from being done on a larger scale to a shared service centre (SSC).

The SSC would be jointly owned and governed by its member councils.

The SSC would be run strictly as a business providing works, maintenance, IT, financial services, etc to participating councils on a fee-for-service contract basis.

    1. Competitive Sourcing.

To ensure that a SSC gave value for money, there would be sunset clause on its exclusive mandate.

Thereafter, Councils would be free to choose alternative suppliers if they offered better services.

The SSC would be required to cease those services for which it had insufficient clients.

Conclusion

Administrative reality:

The efficiency and effectiveness of a local council is not a function of size.

All the empirical evidence suggests that big is not better when it comes to local government.

Where economies of scale are relevant (e.g. public works and maintenance depots), the most practical solution is shared service centres, not amalgamations.

Political reality:

Percy Allan concluded his presentation by saying

Let’s put amalgamations in the too hard basket and address the real GAP that concerns people about their councils:

Governance;

Accountability; and

Performance.

So with this in mind, and given that state governments are here to stay whether we like it or not for the foreseeable future (acknowledging that our campaign to get rid of them is also here to stay and we should persevere with it), we should be aiming to make councils as good as they can be, and working to improve the transparency, accountability and make-up of our councils so the problems that so frustrate us are less likely to happen.

Greens policy reflects these needs.

One way of doing this is encourage people to be part of local government by standing for election. The Greens have had a lot of success at the local government level and have many Green Councillors around Australia. 30 of these are in NSW, but they are also in Tasmania, Victoria, SA and WA (though there they are not Green-declared due to the widespread tradition of councillors being non-party aligned, at least). Greens hold the balance of power in a number of councils, including Yarra Council in Victoria where the mayor is also Green.

Another way of doing it is to attend council meetings and ask the right questions. To write to the local paper about issues of concern. To encourage and be part of participatory processes. We especially need to get young people involved and interested, and feeling confident that involvement can make a difference.

We need strong national guidelines to ensure that all new developments are supported by the wider community, not thrust upon them because a state planning minister can override a local decision, or because developers have given large handouts to party or individual election campaigns. Such guidelines would also ensure that these developments were energy and water efficient and had waste disposal and grey water recycling as a fundamental requirement. They would also not be able to encroach on viable farming land, or destroy wetlands, forest and woodlands, or deleteriously impact on beaches and rivers, by altering the coastline with rock groynes and jetties for example. And there would need to be adequate infrastructure for efficient public transport.

We need to take power away from general managers and put it back in the hands of councillors - it is the elected representatives who should be making policy, not the GM. And we should encourage people to be honest about their party affiliations, instead of accepting the independent status of candidates at election time when they are actually members or supporters of political parties.

The principles of the Greens Local Government policy state:

The Australian Greens are concerned about the present nature and rate of privatisation and corporatisation of local government services including:

While the proportion of women involved in local government is greater than in other spheres of government, their participation is limited and should be increased.

And the goals:

While the Australian Greens support local autonomy, we also acknowledge that giving unbridled power to local councils could lead to further problems, especially irreversible environmental ones.

The Australian Greens propose:

  1. a Code of Ethics and a Bill of Rights and Responsibilities based on green principles to ensure that, among other things, local activities are socially advantageous and environmentally benign;

  2. a review of local government electoral processes, with a view to recommending proportional representation;

(I was alarmed to hear Allan suggesting this morning that we should get rid of the Upper Houses and decrease the number of Lower House members, because the Upper Houses and Senate are the only P.R. that we have at the moment, and therefore the only chance we have of giving the minorities a voice.)

  1. a review of the revenue base of local government; and

  2. better coordination with other levels of government to avoid duplication and unnecessary waste of resources.

The policy's Short Term Targets say:

In recognising that local government must play an expanded and more autonomous role while maintaining its accountability if we are to achieve a truly democratic system of government in Australia, the Australian Greens propose:

  1. financial support for those elected to local government, in recognition of the part they must play in decision-making;

  2. increased involvement of local government at other levels of government;

  3. that State of the Environment reporting include criteria for measuring the environmental impact of developments;

  4. that those people who are found to have acted in a corrupt way be barred from ever holding public office again and as well, that they forfeit any superannuation payments they may have made while holding that office and that they lose the right to any termination payments for which they would otherwise have been eligible;

  5. that local councils require all new buildings, subdivisions and developments to conform to Ecologically Sustainable Development (ESD) principles;

  6. a regular flow of information to the community via community radio, newsletters and noticeboards to give equal voice to a range of ideas and to encourage community participation in local government;

  7. that all spheres of government take immediate steps to familiarise all citizens with their rights and with all aspects of the present electoral system; and

  8. that there be appropriate and adequate consultation to better gauge opinions on issues of concern.

The Greens see these changes as part of much wider changes to our whole system. Our Constitutional Reform and Democracy policy states:

The Australian Greens support fundamental reform to the constitution and other structures of democratic governance.

We support a process for ongoing constitutional reform which reflects that agreed to at the Constitutional Convention.

At the heart of this process for ongoing constitutional reform is participation by the community. No matter how many models for a new system we come up with, a move towards two-sphered system, or a republic, or a new constitution, will never gain the support it needs to become a reality unless the Australian community can claim ownership. As we saw with the Constitutional Convention and its aftermath, people want to be part of the process of deciding, not have a decision foisted upon them.

So rather than outline a Green model for a new, improved system, I am putting some paper up on the wall for people to put down their own ideas. The only constraints in this process are that this is to be a green exercise, so as such must be based on the four Green principles of social and economic justice, grassroots democracy, ecological sustainability and peace, nonviolence and disarmament. And implicit in it is the principle that small is beautiful, and that larger is OK for some things, as espoused by Percy Allan.

So there are three sheets. The first is local government, the second is regional infrastructure sharing and the third is national government. To get the ball rolling, I have started the list.

As you can see, it will be the national government's responsibility to look after the rivers. We have already had one whole congress devoted to how our river systems have suffered because of state governments, so that's an obvious one.

And as mentioned, there's transport, and it's worth mentioning education - that's free education, tertiary included, available to all, not just those who can afford it.

And as also previously mentioned, there would need to be national guidelines for development - what would and wouldn't be acceptable, with it still being up to a local community to decide whether or not any ecologically sustainable development should go ahead in its area.

The only way to handle an issue like genetic engineering (GE) is on a national basis. So any potentially irreversible threat to our agriculture and health would need to be approached holistically and not in the piecemeal way that we have seen with GE, with some states taking longer to adopt the precautionary principle than others, and large corporations driving the GE push.

I've also thrown in peace-keeping (as opposed to defence), although given the Federal Government's latest performances in this area, I can't help thinking we would have been better served by local communities determining whether or not Australia should have been involved in a war in Iraq and (let us hope it won't come to it), whether we should be involved in a war with north Korea.

Local government would be in charge of looking after the same things that it does now. Its responsibilities might include properly funded co-ordination of SES volunteer bushfire services, ensuring that there were local community centres offering meeting and exhibition spaces, community garden, employment, youth services etc.

And the regional service centres could look after everything that didn't need to be provided in every local community, but this regional sphere would not necessarily be part of a decision-making structure.

Which brings us to structure. How might the actual structure of a new system of governance look in terms of the elected representatives?

I believe that we need to ensure that in our new and improved system there is some overlap in representation between the two spheres, to guarantee that they are integrated, to ensure that lines of communication between the spheres are always kept open and to facilitate ongoing co-operation and understanding. One way of doing this might be to have a representative for each Local Government area who was elected at the same time as councillors were, who could form part of the representation of a larger, regional area that would be the federal electorate.

But that discussion is for another day.

In the meantime, let's work to protect what we have and ensure that local government is strengthened not weakened. Anything less would not be true democracy.