Demerger bill welcomed with caution by Tumba, Gundagai community leaders

An eight-year battle for local democracy for the communities of Gundagai and Tumbarumba is showing signs of abating thanks to the Local Government Amendment (De-amalgamations) Bill 2024 passing both Houses of NSW Parliament, but demerger activists say the war has not yet been won.

The new legislation means, in this region, the forcibly merged Snowy Valleys Council and Cootamundra-Gundagai Regional Council now have the power to make decisions about their future, with a strong caveat – that it’s done in consultation with their communities.

Under the government’s new laws, councils seeking to demerge must work in close consultation with their community to ensure local democracy is enshrined throughout the entire process.

The new pathway will require councils to develop a robust business case for de-amalgamation with community input so residents are adequately informed of potential implications upfront. The business case should consider financial ramifications, long-term strategic plans, and the capacity of new councils to deliver services.

The business case will then be referred to the Local Government Boundaries Commission (LGBC) for independent review and assessment.

If the minister is satisfied by the LGBC’s recommendation a proposal is sound, a compulsory local referendum may then be held to give the community the final say on whether they wish to de-amalgamate.

Save Tumbarumba Shire spokeperson Doug Gee says that’s less than ideal in the Snowy Valleys Local Government area, where the bulk of the population lives in Tumut.

“One of the issues is it actually doesn’t give any voice to small communities because any decision has to go to a referendum, so in the case of Tumbarumba, you know, we’re a very small part of the population,” he said.

The legislation also provides a mechanism for the government, through grants of up to $5 million, to contribute to funding the costs of demergers incurred by councils.

“The government is saying they will contribute funds towards offsetting any costs of de-amalgamation, which is good news for this current Snowy Valleys Council,” Mr Gee said, “but it’s not good for anybody else who pushes for a demerger but hasn’t got the support of their council.”

He said Tumbarumba Shire Council had gone from being the second-best performing council in the state premerger, to an amalgamated community who not only lost their voice in local governance but lost vital services and grant money following the Black Summer bushfires.

“Tumbarumba copped the brunt of the fires,” he said, “but the money was spent in Tumut.

“And they’ve (SVC) applied for another special rate variation of 43 per cent, which will see most people’s rates at least at 100 percent more than what they were pre-merger. The reality is the financial impact of the forced amalgamation has not been on the council per se, the impact of it all is on the ratepayers.

“But if I’m paying that, I’m happier to be paying a council that’s based locally and we have input into and will be responsive to this community.”

Mr Gee has urged Tumbarumba residents to prepare their submissions and voice their concerns ahead of the upcoming LGBC inquiry.

Gundagai Council in Exile spokesperson Glen Moore said, as far as he was aware, NSW Local Government Minister Ron Hoenig had acknowledged Cootamundra-Gundagai Regional Council was not subject to the Bill because they started the process of demerging before it was introduced.

“We’re going down a different pathway and we’ve complied with his wishes to date,” he said.

“The council prepared a sustainability report and a financial report, placed it in the hands of the minister, the minister has put that on public display, called for submissions … and I believe they have 600-700 submissions overwhelmingly in favour of the demerger. We’re very hopeful this will allow the minister to make a quick decision in the affirmative.”

He said the minister could opt for a third LGBC public inquiry.

“We’ve already had two of those and we don’t want a third,” he said, “and we’ve made it quite clear to the minister we’ve been down this path twice … there’s no need to do this again.”

The new legislation also applies to any council that has been amalgamated, removing a provision that placed a 10-year period for councils to enact demerger proceedings

Independent Member for Wagga Wagga Dr Joe McGirr has thanked local communities who have helped drive legislation that opened an avenue for amalgamated councils to demerge.

“I’m proud to have worked with passionate advocates for demergers and to have advocated strongly with the government, and at last that work has begun to pay off,” he said.

“Snowy Valleys Council now has a real opportunity to revert to the former Tumut and Tumbarumba councils, if both communities wish to go down that path.”