The impact of metropolitan amalgamations in Sydney on municipal financial sustainability

Abstract

The Australian Independent Local Government Review Panel recently proposed amalgamating the majority of New South Wales (NSW) local councils in the Greater Sydney metropolitan region in order to increase municipal population size with the aim of engineering a more financially sustainable system. However, no attempt was made to determine whether there is a statistically significant association between larger population size and improved financial sustainability ratios, nor whether the proposed merged local authorities will be more financially viable. This paper addresses these critical omissions. The empirical analysis reported indicates that the proposed amalgamations will not secure enhanced financial sustainability in Greater Sydney local government.