The NSW government has left some councils with hefty bills to pay since their forced amalgamations in May last year.
Government News understands that mergers have ended up costing some NSW councils more than the state government merger and transition funding they were given.
Rural and regional councils, in particular, are resentful because they received only half of what metropolitan councils were given to cover the process and yet they often receive much less from rates and have lower reserves.
Rural and regional councils received $5 million for each merger, while metropolitan councils were handed $10 million for their mergers under the state government’s New Council Implementation Fund (NCIF).
But there were caveats. The funding could only be used for certain things, such as getting expert advice and integrating IT systems, but not to pay ongoing staff costs or council administrators, who replace councillors and mayors until the local government elections in September.
Councils were also given between $10 to $15 million of Stronger Communities funding to go towards community projects and infrastructure.
Despite the funding, some councils are finding there is a reality gap.
Hilltops Council, a merger between Boorowa, Harden and Young Councils in the South West Slopes of the state, estimates that it will end up spending $6.5 million on its merger, a shortfall of $1.5 million.
Greens MP and Local Government Spokesperson David Shoebridge said residents of the three former council areas would be ‘shaking their heads’ at the figures and wondering where the $1.5 million extra would come from.
“Every independent expert said at the start of this process that amalgamations would be more expensive and more disruptive than the government pretended, and now we are seeing this come true,” Mr Shoebridge said.
“The incompetence of the Coalition is really staggering, and now they are expecting residents in the local councils they have destroyed to meet the cost of their failure.”
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