Impact of NSW council mergers to be exposed by survey


The successes and failures of the recent NSW council mergers will be laid bare using data from an annual benchmarking survey – the first of its kind in Australia.

The merger process has been fraught for NSW Premier Mike Baird, with both sides flinging around statistics about merger costs and savings in an attempt to support or refute the ideological case for forced council mergers.

Nineteen new NSW councils were created on May 12 (from 41 councils) and there are 11 more council mergers in the offing, pending the outcome of court cases.

Part of the problem of making a case for – or against – mergers in the past has been that their impact has never been systematically measured, not in Victoria during the 1994 mergers, nor the Queensland council mergers in 2008.

It makes it impossible to conclude whether mergers have been duds or shining successes or a mixture of both.

Local Government Professionals Australia NSW and Price Waterhouse Coopers (PWC) are attempting to remedy this situation and they have been collecting statistics from many NSW councils on a wide range of topics since 2013, in anticipation that council mergers were not going away any time soon.

The reports, NSW local government operational and management effectiveness reports, will provide baseline data on the impact of NSW council mergers.

By 2019, there will be six years of data for many councils, four before mergers and two years after, giving new councils a good idea of how the mergers have gone across a number of indicators.

Some Western Australia and New Zealand councils have also joined the project.

Detailed intelligence has been amassed on councils’ workforces, service delivery and operations.  Examples of indicators include, the cost of providing various services and what councils spend on each citizen, for example, on waste and water; the structure of corporate services; the number of managers per staff member and so on.

Workforce profiles form a key element of the project, logging the jobs and skill sets of staff and data on areas such as staff turnover by age group, gender and ethnic mix, sick leave and the number of women promoted at each level. Important information when amalgamating staff from several councils into one.

Councils are given a report and analysis to help highlight areas that are going well and those which need attention.

Councils opt in and pay for the benchmarking. The council leadership team then decides what to do with the information, whether to make it public, use it only internally for decision make or communicate it to staff.

CEO of Local Government Professionals Australia NSW Annalisa Haskell said the project would be able to finally track council performance before and after council mergers in NSW: an Australian first.

“No other state has a tracking vehicle before [for] change. It’s a really powerful tool for the councils,” Ms Haskell said. “You actually know where you are and where you’re going.”

“How will you know you get there if you don’t measure it?

“Nobody has taken the time to understand local government.”

She said the reports would allow councils to keep track of how they went over the years and provide useful comparisons to councils of similar size and location.

It was not necessarily about the savings that could be squeezed from mergers but about improving outcomes, such as higher levels of service or a better service mix, and the community benefit from these, “The service mix of a council is critical in understanding how that council is working and its initial performance.”

Ms Haskell said she also wants to make sure that council management teams are accountable for delivering outcomes, primarily by giving them the data to help them measure these.

The data will give council managers the tools to make decisions and allocated funding and staff and give merged councils the information they need to harmonise areas such as service levels and delivery.

But it is not merely about metrics but also very much about context.

For example, a council may spend an above average amount on road construction per citizen because of the type of surfaces it is dealing with or it may spend more on aged care or childcare than another council because of an area’s demographics.

Service mix and costs are a function of different pressures, whether this is physical, demographic or geographical.

Barry Smith, President of Local Government Professionals Australia NSW and General Manager at Hunters Hill Council, said the benchmarking would be ‘critical’ for councils.

“It’s allowing us to collect a whole range of operational data and then compare it to benchmarks. If you can’t measure it you can’t maintain it.”

Stuart Shinfield is Head of Partner Analytics at PWC and he says senior leaders at councils will benefit from having access to years of data.

“There is a focus on helping [council] managers to do a better job of the stewardship of resources.”

Director of Community Services at Sydney’s newly created Inner West Council Simone Schwartz agreed and said the reports were a vital tool for councils, rather than a ranking system and a big stick to hit them with.

“You can look at trends for your own organisation. It’s measuring against yourself, where you are above or below a benchmark and where you can improve,” Ms Schwartz said.

She points out that there is an incredibly diverse team of people working for councils delivering a huge complexity of services to communities.

“In Community Services I have landscape architects, historians, chefs, childcare workers, librarians.

“Local government is in the business of solving complex problems.”

The results of all this benchmarking could prove uplifting or highly damaging to NSW Mike Baird when NSW goes to the polls in 2019.

The data is limited by two things: a three-year moratorium on forced redundancies for staff at newly merged councils (five, in some councils) and a NSW government imposed four-year freeze on council rates.

The vindication – or fallout – will also depend upon what the results are and whether councils chose to make them public.

So far around 61 NSW councils, 40 Western Australian councils and 28 from New Zealand are part of the project. The deadline for joining is the end of June.

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