Alderman Philip Cocker today called on the Hobart Chamber of Commerce to stop promoting the illusion of rivers of money if council amalgamations go ahead. The Chamber of Commerce is dooming any amalgamations to failure by perpetuating the myth of massive savings” Alderman Cocker said.
“The abundance of wealth that will magically become available if we amalgamate councils does not exist and can be proven to not exist” Alderman Cocker said. There is a wealth of excellent work that has been done looking at council amalgamations that have occurred in Australia and overseas. What is has consistently shown is that we should be beware of claims of extensive savings. This is because it is based on flawed thinking. On the 29th of September the Examiner newspaper quoted Mary Massina from the property council who said “she agreed that interstate research did not show that other states had made substantial cost savings from amalgamation”
“The Hobart Chamber of Commerce is clearly ignorant of the nature of much the work that the council does”, Alderman Cocker said. Large savings do not exist and are not available. These illusory savings are based on false assumptions about the nature of the work councils do.
The first of these is that economies of scale that you get in the economics of manufacturing can be applied to local government services. It is not the case with many of these services. The second is that administration is a large financial burden on council and the ratepayers. By far the heaviest financial burden for councils is having sufficient funds to maintain assets and infrastructure in their areas. These costs will not change regardless of the amount of representation the community has.
Savings through cuts to administration might be possible but they will have their own cost when jobs are abolished from towns and communities. Those lost jobs will have a detrimental impact on community and business.
“Fantastic amounts of monies to be saved makes for a good press release but the reality is very different and does nothing to forward the debate on improving how our councils can operate and being the most efficient we can be. The Chamber of Commerce would be advised to look at research available and not parrot other vested interest’s propaganda”, Alderman Cocker said.
