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Local government structural reform in Tasmania


Local Government Structural Reform in TasmaniaThis paper, undertaken for the Property Council of Australia , Tasmanian division, examines the case for, and potential benefits from, further local government structural reform in Tasmania.

Past reforms demonstrate that there are potentially significant benefits to be achieved from local government structural reform, but – crucially – that the conditions must be appropriate.

Efficiencies alone, do not provide a robust justification for structural reform. It is the economic and social benefits facilitated by these efficiencies that underwrite the merit of council consolidation, in particular the capacity to deliver improved service levels or broader service ranges to the community; the ability to reduce council rates (or at least slow the pace of rate inflation); and/or the capacity to bolster the financial sustainability of councils.

Rate reductions, service quality improvements and enhanced fiscal sustainability all offer long term benefits for the community. When these benefits are overlayed with the potential for enhanced council capability, the opportunities for community gain are heightened.

The report presents a high-level analysis drawing solely upon existing literature and publicly available data related to local government in Tasmania and in other states. A more detailed study might also draw on consultations with councils and other stakeholders, as well as seeking additional data directly from councils.

For ease of reference the report is structured as follows:

  • Chapter 2 provides an overview of Tasmania’s economy, Tasmania’s local councils and how they compare with other States, plus a brief history of local government structural reform
  • Chapter 3 provides an overview of the theoretical rationale for structural reform, as well as empirical evidence relating to the impacts of reform
  • Chapter 4 describes our methodological approach to modelling potential benefits and the findings of that empirical modelling
  • Chapter 5 outlines the broader economic benefits of structural reform, including the potential for improved capacity and effectiveness
  • Chapter 6 canvasses factors critical to the success of local council structural reform.

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