HOW LOCAL WAS TAKEN OUT OF LOCAL GOVERNMENT
And Why Victoria’s Suburbs Are Now Governed by Algorithms, Ambition, and Aqueducts to Nowhere
I. THE KENNETT EARTHQUAKE (1992-1999)
When Jeff Kennett’s Liberal-National coalition swept into office in September 1992, Victoria became a laboratory for radical neoliberal experimentation. The scale was breathtaking:
- 75,000 public sector workers retrenched
- $30 billion+ in privatisation proceeds from selling everything from electricity to public transport
- 10% cut in government spending across the board
But for local government, the hammer fell hardest. Victoria’s 210 councils were forcibly amalgamated into just 78. Elected representatives were sacked, replaced by government-appointed commissioners. Democracy was suspended – in some areas for up to two years.
The rationale? Efficiency. Economies of scale. Professional management over parochial interests.
II. THE NEW PUBLIC MANAGEMENT MACHINE
The Kennett government didn’t just shrink government – it fundamentally reimagined its relationship with citizens. This was “new public management” with a vengeance:
- Departments slashed from 22 to just 8 between 1992-1996
- Governance restructured like a corporate board: Ministers as directors, bureaucrats as CEOs
- Industrial relations transformed – individual contracts replaced awards, performance pay replaced increments
For councils, this meant:
- Appointed CEOs with corporate powers
- Compulsory competitive tendering – services put out to private tender
- A shift from “providing services” to “contracting outcomes”
As one Surf Coast councillor noted, councils became “boards of directors” rather than community representatives.
III. THE HUMAN COST: MANSFIELD’S FIGHT BACK
Theory met reality in places like Mansfield. Forced into the mega-council “Delatite Shire” with Benalla, the community watched their town unravel:
“Services collapsed, administration moved to Benalla and Mansfield entered a period of social and physical decline. It was brought home to locals that when Local Government is moved elsewhere, not only do the roads deteriorate, but other unrelated services such as the hospital and the schools suffer in a spiral of declining funding and numbers.”
Fourteen hundred locals formed the Mansfield District Residents and Ratepayers Association. They fought for years. And remarkably, in 2002 – against all odds – they won back their independence.
The lesson? Amalgamation wasn’t inevitable. It was a choice—and sometimes communities could choose differently.
IV. THE EVIDENCE: DID ANY OF IT WORK?
The academic verdict is damning. Forced amalgamation was sold as a “magic bullet” for council finances. But as the Productivity Commission and multiple state inquiries found, it didn’t work.
- States that amalgamated (Victoria, SA, NSW) continued having financial problems
- States that didn’t (WA, Queensland) had similar problems
- The infrastructure deficit – roads, drains, community facilities – continued growing everywhere
One analysis concluded the Reform Commission seemed to have “learned nothing from the hard-won experience of other Australian states.” Another noted that advocates of amalgamation consistently ignored empirical evidence in favour of ideological conviction.
V. WHERE WE ARE NOW: AQUEDUCTS TO NOWHERE
Fast forward to 2026. What do we have?
1. Digital Disconnection
You now “interact” with council online – if at all. The physical counters are gone. The human faces are replaced by AI chatbots. Rates didn’t go down. Staff didn’t increase. You just… don’t matter as much.
2. The Political Launchpad
Council has become a career stepping-stone. Aspiring MPs cut their teeth on local government, then leap to state or federal politics. The result? Councillors more focused on their future careers than on fixing your potholes. Partisan politics infects local decisions. Ratepayers become an afterthought.
3. The Art of Irrelevance
And then there are the aqueducts to nowhere – expensive public art installations that no one asked for, funded by developers or grants, justified as “place-making.” They’re monuments to a system that has lost the plot. In ancient Rome, aqueducts carried water. Today’s equivalents carry… political ambition and developer goodwill.
4. Parking Sensors and Bench Removal
The Boronia Mall parking sensors aren’t just annoying – they’re symptomatic. Councils that can’t or won’t provide basic amenities (benches, public toilets, actual community spaces) have become expert at revenue collection. It’s easier to fine a mother for overstaying by seven minutes than to build the kind of community where she’d want to linger.
VI. THE NEOLIBERAL BLIND SPOT
Here’s the core problem: neoliberalism requires an absence of imagination.
It treats citizens as consumers. It measures success by efficiency metrics. It cannot calculate the value of a bench where old friends meet, a counter where you recognise the staff, a council that knows your name.
Those things don’t show up on spreadsheets. So they get cut.
As the ANU analysis concluded, structural reform failed because it ignored “the hard-won experience of other Australian states” – and because it refused to look at actual evidence.
VII. WHAT NOW?
Mansfield proved it’s possible to push back. But de-amalgamation is rare, expensive, and exhausting.
The deeper change required is cultural: we need to value local government again. Not as a training ground for higher office. Not as a delivery mechanism for state policies. But as the level of government closest to people – the one that should feel like us.
That means:
- Resisting the centralising impulse
- Funding councils properly
- Respecting local knowledge
- And maybe, just maybe, putting back some benches
Because communities aren’t built by algorithms. They’re built by people who sit down together.
References
McIntosh & Hayward, “The neo-liberal revolution and the regional state in Canada and Australia” (Swinburne, 2024)
Mansfield Shire Council, “Fighting For Our Independence” (2022)
Dollery et al., ANU analysis of amalgamation evidence
ANU Press, analysis of Kennett government reforms
LG Focus, “Elected representation post amalgamations” (1997)
Chen, P., “They’re not like us: the de-amalgamation of Delatite Shire” (2002)
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The biggest insult to the victims of Kennett, the drunken freeloader was his appointment as head of Beyond Blue.
The mental damage he caused Victorians was beyond measure.
Sully, I agree, Jeff Kennett’s government damaged Victoria beyond repair and sadly, the state has gone down hill ever since. Victoria has, in my opinion, gone from. best to worst and it’s all as a result of Kennett.
I have family with Kennett association through Hawthorn Footy, and he is and was divisive, abrasive, blunt, egofixated, and usually strongly in error. But life has its Kennetts, parasites, saviours, maggots, Paulines, boofheads, narcissists…
We cannot blame any Victorians for the local government disaster that has occurred in Armidale NSW over the past 30 years. The true cause was the personal managerial ineptitude of the NOtional$ Councillors elected by exploiting the provisions of surplus votes distribution at Council elections. Thirteen (13) years of disastrous financial mismanagement followed by about four (4) years of unresolved administrative confusion that was eventually terminated by appointment of a government Administrator, who ripped off the ratepayers with his additional allowances.
This maladministration was assisted by the Local Government Act (1993) NSW and subsequent Regulations, that have created for us the ”local government monster” described in Victoria.
But nothing has changed because back in the 50s Bob Menzies said to ”look out for the reds under your beds” ….. and the rural property owning ratepayers are still looking!!
Well, that way you do NOT see the rapidly approaching 19th century future, a natural consequence of voting NOtional$ regardless of the absence of any outcomes.
Appointing CEOs – pick the most incompetent candidate so that the self-serving then Mayor could ”ideally” manipulate policy and allowances.
Competitive tendering – Why bother ….. when a Councillor has the only machinery available to do the job.
Infra-structure deficit – use the available government funding to employ enough surplus middle managers to carry the buck passed by a less competent senior paid officer when a scape goat is required to protect their own senior career position.
Fight back?? You are joking!! The unwanted forced amalgamation of Guyra Shire Council (GSC) with Armidale Dumaresq Council (ADC) caused serious concerns among northern (Guyra) ratepayers when their rates shot skywards to cover the huge deficit NOT recovered by selling off GSC property & chattels.
Now the agricultural community around Armidale city wants a separate ”farmers shire” having about 80% of the remaining land area, including most of the gravel or unformed roads, after a boundary decision slashed off about 30% of GSC which was gifted to the neighbouring Inverell Shire Council that was the ”community centre” rather than the new, but still toxic corporate ethos, in Armidale Regional Council (ARC).
Political Launchpad – Get the son-in-law of a long standing Senator elected to the overpaid Mayor position by exploiting the local NOtional$ organisation, do a ”payback” deal with the dominant NOtional$ electorate leaders in Tamworth, and that way a sound financial future is almost guaranteed for the Senator’s daughter & his grandkids. QED.
Acts of Irrelevance – In an electorate built around the Main North (railway) Line (MNL) for 216 km north from Armidale to Jennings Wallangarra, campaign loudly to rip-up the rails to build (another rarely used) rail trail to nowhere to see nothing.
Then remember the Roman strategy and follow a very expensive ”bread & circuses” approach to buy instant gratification for the under-employed young adults festering in the absence of economic opportunity.
Parking Fines & Basic Amenities – Revolutionise parking fines by installing an expensive remote identification of over-parking for the little Grey Parking Rangers (GPR) to rush out and book the offending out of town travellers.
Every morning locate GPRs in camera long lens range of school bus zones to harvest the rich pockets of families delivering kids to schools lacking dedicated ”kid delivery dropping zones”. This is a much more comfortable anonymous manner of financially beating up on your neighbours ….. in the name of ”It was only my job”. (Nuremberg Trials come to mind).
The future?? – There will be few changes while the staff in the Office of Local Government once in the Premiers Department now elsewhere, to condone, encourage & continue inefficiency and corruption.
Local government in Armidale NSW has become a self-serving corporate entity that does as little as possible for as long as they can using as little effort as necessary. Sound familiar??
@ Phil Pryor: Thank you for the edit.
The MP for Wentworth correctly was Peter Coleman, the father-in-law of Peter Costello, as above, NOT Peter King.
That is my error. Apologies.
It’s not just funding, there is also a move to take responsibilities and opportunities for input from councils and, thus, the local community.
Here in Tassie, the local council nixed a proposed development within the Walls of Jerusalem NP, after a section of it was rezoned to permit a fly-in fishing “camp”. The proposal failed to meet the local planning requirements on a number of points, including fire safety. So the state misgovernment has taken over assessment of certain development proposals, to prevent a recurrence.
That didn’t stop the proposal getting the kibosh from the courts, however, so it’s still on hold although the proponents are still trying to find ways to get it up and running. There’s a lot of money behind the push, which is part of the ongoing program to privatise NPs as much as possible.
In 2016, (in southern NSW), the Tumbarumba LGA was merged with the Tumut LGA to form the Snowy Valleys Council LGA. This was despite the objection of more than 95% of the Tumbarumba LGA residents. The NSW Minister for Local Government responsible for the mergers of NSW LGA’s at that time was (either) Paul Toole (National) or Gabrielle Upton (Liberal), and their dogmatic determination to merge councils thoughout NSW was a barefaced example of antidemocratic bulldozing of ideology to the detriment of the voting public. They will never be forgiven.
Thankfully, the change of government brought a change of attitude and there will be demergers. My sister-in-law lives within the Tumbarumba district and she is very clear on how the merger initiated a radical loss of local services, road maintenance, access to councillers, and general goodwill in regard to councils and their relationship to the local communities.
New England Cockie, my Shire, Wingecarribee inherited the Vivisector after he finished with Armidale. Between bringing in a heap of outsiders to run the Council’s departments, people who knew nothing of our local area’s history, geography or culture, and abolishing and changing many advisory groups, we were left with a huge gap in expertise which our neophyte Councillors are now struggling with. Whatever the problems of an elected Council may be, they are not helped by imposing a dictator for four years
@ Lyndal: At Armidale Regional Council (ARC) the Administrator was paid a salary package of $150,000 per year ”until the end of the inaugural meeting of ARC”. This was insufficient for his ”needs”.
1) With the compliance of the OLG staff, as the Administrator he proposed a motion for the next ARC Council meeting to pay the Administrator extra expenses at the same rates as Councillors. Then that evening, sitting as the appointed Council, passed that motion.
Could that be abuse of power?? Or fraud??
So the Administrator established a ”Temporary residence” at a motel a short five minute walk across the town park to the Council Chambers, where he resided AT RATEPAYERS EXPENSE during his four day working week.
2) The permanent residence of the Administrator was about 250 km distant so being the appointed Administrator he gave himself use of the allocated Mayoral vehicle which he used to commute between ARC and his permanent residence.
Throughout this period he failed to complete the necessary log book and fuel purchase documentation for about 26,000 km of travel AT RATEPAYER EXPENSE.
This corruption was ”overlooked”/ignored by complicit OLG staff.
Would any private business allow such behaviour?? Would it be considered ”fraud”??
Certainly it would make the proponent unfit for any further appointment as an Administrator in any NSW Council. But when you have a life-time experience within a ”mate’s workplace” complicity in any suspicious financial matters insures that there will be few, if any, legal consequences.
@ New England Cocky your first post described the last local government council that I lived under and paid rates to for 30 years, Brimbank!