Top Gear or Stuck in Neutral: What next for Australian local government? Graham Sansom

Rabia Siddique’s messages Confront the reality If necessary, change the narrative Be willing to take uncomfortable steps

A new challenge Smart Cities and City Deals (UK ‘Combined Authorities’)

ALGA’s response Welcomed Government’s recognition of importance of cities policy “… a logical extension to the work of many councils ... On a daily basis councils are harnessing the … resources of their regions to deliver a range of sustainable outcomes … ” “ … the UK City Deals model … will be an interesting concept to explore and ALFGA is keen to work with the Government …” But ALGA’s budget submission was all about increased federal funding for councils: > $4bn over forward estimates plus $1.5bn every year after Clearly unrealistic What message does this convey to the PM?

? A changing federation Will local government hold its position? How? Commonwealth Commonwealth ? State State Local Local Will local government hold its position? How?

LG’s strengths and weaknesses Integrated planning and place focus Informed localism and regionalism Responsive to communities Financial autonomy Service delivery Capacity for innovation and leadership Silos and wish-lists Fragmented parochialism Disengaged communities Mendicant mentality Governance failures Compliance culture and ‘learned helplessness’

‘Strategic capacity’ Coping with change and uncertainty: Accepting the mantle of ‘government’ Developing new skills (policy, partnerships, inter-government relations) Councils must be ‘fit for purpose’ Queensland Reform Commission (2007) called for: “High capacity organisations with the requisite knowledge, creativity and innovation to enable them to manage complex change” Amalgamation proposals were more about capacity to provide effective governance than efficiency and savings

‘Strategic Capacity’ Relevance Resources Respect Within system of government Wider agendas Places and communities Role/capacity of larger councils Resources Revenue base Finance/asset management Broad skills base (inc strategy, policy, IGR) Top-class senior team Respect Political renewal, role of mayors Good governance Transparency, performance reporting, benchmarking

A fresh narrative for rates Rates are a ‘good’ tax, but often poorly applied They can be used as a broad-based land tax and for ‘value capture’ A major revenue source for infrastructure and ‘jobs and growth’ Lessons from NSW rate-pegging: people are willing to pay more if convinced of the benefits Enormous scope to raise more revenue within community capacity to pay – but care needed to ensure equity and help some ratepayers What if the rate-in-the-dollar was held constant while land values rose? (like ‘bracket creep’)

Re-thinking grants Miracle of the federal budget: local government comes out in front – but can it last? FAGs + R2R = approx $2.7bn per annum Ample for equalisation but much of it wasted on ratepayers (NOT councils) who don’t need assistance Scope to strengthen local government as a whole by: Removing entitlement to grants across the board Putting, say $1.0bn into strategic projects (City Deals, regional development, major infrastructure) to be determined by groups of councils What about a re-distribution scheme within local government (cf Switzerland)?

Embracing regional collaboration

Place-based leadership (Hambleton) Concerted action by a range of local players to secure the futures and values of places and communities Closely linked to concepts of ‘place shaping’ and ‘localism’ Collaborative mechanisms – Local Strategic/Enterprise Partnerships in UK Necessary leadership can emanate from any of the three realms: councils must partner, not control

Some other critical issues Roles and relationships of governing bodies, councillors, mayors and CEOs (GMs) Current Act reviews in NSW, Victoria, Tasmania Real community engagement is fundamental to strong local democracy within the system of government Robust legislation should be welcomed Community governance must be embraced Innovation is essential to maintain relevance, address emerging agendas and stretch resources Requires concerted sector-wide support and networks Is the sector prepared to fund the necessary R&D?

So what’s the way forward? LG is a small player in some ways, but its place-base and robust revenues offer great scope for leverage: Real capacity to make a difference if revenue sources, local democracy and scope for regional leadership are approached more strategically Attitudes and actions of the States are a problem but: States are the financial weakest link in the federation Need for efficiency and effectiveness in service delivery will drive a localist agenda – attractive to Canberra Does LG have to remain State-bound? LG must organise and position itself to seize opportunities Focusing on constraints guarantees a steady decline into irrelevance and damage to community life