Local Government (Boundary Adjustment) Amendment Bill

Introduction and First Reading

The Hon. G.G. BROCK (Frome—Minister for Regional Development, Minister for Local Government) (16:11): Obtained leave and introduced a bill for an act to amend the Local Government Act 1999. Read a first time.

Second Reading

The Hon. G.G. BROCK (Frome—Minister for Regional Development, Minister for Local Government) (16:11): I move:

That this bill be now read a second time.

The Local Government (Boundary Adjustment) Amendment Bill 2016 seeks to reform the legislative provisions that govern how council boundaries can be changed under the Local Government Act 1999. While significant amendments have been made to the local government legislative framework to strengthen local government accountability and governance, strategic planning, financial and asset management and community consultation, the framework that governs the operations of council boundary changes has not been amended since the act's commencement in 2000.

At the commencement of the act the Boundary Adjustment Facilitation Panel was established as an interim body to refine council boundaries following the council amalgamations and boundary alterations that occurred in South Australia in the late 1990s. Since that time there have been very few significant boundary changes to councils in this state.

Following the abolition of the Boundary Adjustment Facilitation Panel through the Review of State Government Boards and Committees, I made a commitment to review the provisions of the act relating to council boundary changes. Reforming the legislative provisions that govern how council boundaries can be changed has been a significant item for discussion at the Premier's State/Local Government Forum meetings. The legislative framework underpinning the bill is based on the review work undertaken by the Local Government Association and the Office of Local Government, as overseen by the forum.

The bill is based on a discussion paper released last year by the Local Government Association on a proposed legislative framework for boundary reform endorsed by the LGA board in November 2015. The framework sets out principles for local government boundary reform and a process for boundary adjustments that have been endorsed by the LGA board and the forum. I would like to thank the LGA for its work in preparing the discussion paper and for the input it has provided for this review of the legislative framework.

A draft bill on these reforms was released for public consultation on 4 August 2016. The original closing date for submissions was 30 September 2016; however, I extended the consultation period by two weeks to allow interested people more time to make a submission. Submissions closed on 14 October 2016. A total of 29 submissions were received, and I am pleased to note that the submissions were generally supportive of the bill.

I now turn to the key elements of the bill. The first of these is the introduction of a simplified pathway for administrative proposals, those that are made to correct historical anomalies in council boundaries, to allow for development that is approved elsewhere, or for other, largely administrative, reasons. Under the current provisions, these proposals are subject to the same processes as proposals for more significant boundary change. These procedural requirements are cumbersome and unnecessarily complex for what can be considered straightforward matters. The bill creates a simpler and more flexible process for both initiating and deciding these proposals.

The bill also clearly recognises the importance of significant boundary changes and the need for there to be much freer debate on these. A key change the bill proposes is to allow proposals for boundary changes to be initiated by a single council or the Minister for Local Government. Currently, significant changes cannot be formally considered unless all councils involved agree that the proposal should go forward. Opening up this initiation process will encourage discussion on structural reform opportunities that could bring real benefit to our communities. It is essential though that a greater ability to initiate proposals is matched with an independent assessment of their merit. The bill therefore establishes an independent commission to oversee the assessment of all proposals.

For significant proposals or, as the bill calls them, 'general proposals', the commission can appoint one or more investigators to undertake a detailed inquiry into the proposal. However, the commission must appoint investigators when a general proposal is referred to them by either the minister or by resolutions of either house of parliament.

The intent of this requirement is to ensure that the close analysis of significant proposals for boundary change is undertaken by people with expertise and knowledge that is specific to each proposal and that there is consultation with the affected councils. The bill also provides appropriate flexibility in appointing investigators. More significant proposals will require a number of investigators, whereas relatively straightforward processes may only require a single investigator.

At the conclusion of an inquiry, the commission must prepare and publish on a website a report that includes the commission's recommendations. The requirement for the commission to publish the report ensures that the commission's advice to the minister and the decision-making that then follows is fully transparent.

The bill provides for the minister to send the report back to the commission for reconsideration in accordance with any directions by the minister. However, if this does occur, the commission must then publish an amended report and provide a copy of the amended report to the minister. The minister may then determine whether a proposal recommended by the commission should proceed.

Given the crucial role of the commission, the question of which body would be best placed to undertake this work was a particularly important matter to resolve. In the consultation on the draft bill, the Local Government Grants Commission was overwhelmingly nominated as the preferred body to undertake this role due to its knowledge, experience and role across all local government finances and services, and also the general high esteem in which the commission is held across the local government sector.

The bill therefore amends the South Australian Local Government Grants Commission Act 1992 to enable the Local Government Grants Commission to perform these functions and to have the support necessary to do so. The bill also includes an amendment to enable the South Australian Local Government Grants Commission account to receive amounts related to and be applied towards the commission's functions.

I emphasise that the functions relating to the boundaries role will be a separate piece of work for the commission. This additional role will not compromise the Local Government Grants Commission's current important function of delivering federal funding as required by the South Australian Local Government Grants Commission Act 1992. I have confirmed this in a letter to the federal Minister for Local Government and Territories, Senator the Hon. Fiona Nash. Further, any federal funding for councils will not be used for boundary commission purposes.

The bill provides for the commission to recover reasonable costs incurred in respect of an inquiry in relation to a general proposal by a council or councils. This will assure councils that the investigations of these proposals are not delayed through limited resource allocations. The cost recovery provisions will also ensure that councils undertake a business case analysis prior to proceeding with the general proposal to determine whether it will result in benefits to their community. Costs related to work needed on proposals initiated by the minister will be the responsibility of the state government.

It is proposed that the legislation commence on 1 January 2019, following the 2018 local government elections. The intervening time will be used to draft guidelines that will set out procedures for inquiries, including the process by which the commission will determine costs.

Guidelines will also be prepared that specify consultation requirements, including consultation with the community, councils affected by proposals and entities that represent the interests of council employees affected by any proposal. The development of the guidelines will be further discussed at the forum meetings and the LGA and unions will be fully consulted on their content.

Finally, the LGA has requested additional amendments to the act to support the development of effective regional governance models in local government. The bill therefore amends section 8 of the act to outline the objects and principles of regional collaboration and partnerships. Further, as part of the council boundary reform framework, the principles for boundary change will also include consideration for regional activities.

The bill also amends the act to include a requirement for councils or other regional bodies to demonstrate the potential benefits of regionalisation that have been assessed as part of long-term planning. In this way the bill supports the effective future of local government in this state, be this through regional service delivery or consideration of council boundaries that best reflect the needs and aspirations of communities across South Australia. I commend the bill to members. I seek leave to have the explanation of clauses inserted into Hansard without my reading it.

Leave granted.

Explanation of Clauses

Part 1—Preliminary

1—Short title

2—Commencement

3—Amendment provisions

These clauses are formal.

Part 2—Amendment of Local Government Act 1999

4—Amendment of section 4—Interpretation

The Commission for the purposes of Chapter 3 Part 2 is the South Australian Local Government Grants Commission.

5—Amendment of section 8—Principles to be observed by a council

An additional principle to be observed by councils relating to regional collaboration is inserted.

6—Amendment of section 26—Principles

The principles relating to proposals are amended to insert a principle relating to regional collaboration being considered as an alternative to structural change. Other amendments are consequential.

7—Substitution of Chapter 3 Part 2 Divisions 4 to 7

A new scheme relating to proposals for boundary changes is proposed to be inserted:

Division 4—Procedures for proposals

27—Preliminary

Definitions are set out for the purposes of the Division. A key definition relates to the proposal guidelines, which the Commission must publish for the purposes of proposals.

28—Commission to receive proposals

Provision is made relating to the referral of proposals to the Commission.

29—Commission to deal with proposals

Procedures relating to how the Commission is to deal with proposals are provided for.

30—Inquiries—administrative proposals

Provision is made for the Commission to inquire into and make recommendations to the Minister in relation to administrative proposals (which are defined). The provision also governs the process relating to the Minister forwarding proposals to the Governor.

31—Inquiries—general proposals

Provision is made for inquiries to be conducted into, and recommendations to be made in relation to, general proposals (which are defined). The Commission may appoint an investigator to conduct an inquiry and report to the Commission on the matter or the Commission may conduct the inquiry itself. The provision also governs the process relating to the Minister forwarding proposals to the Governor.

32—Notification of outcome of inquiries

The Commission is required to give notice of the outcome of inquiries.

32A—Powers relating to inquiries

Powers that may be exercised in the conduct of an inquiry under the Division are set out.

32B—Costs

Provision is made for the Commission to recover the reasonable costs of an inquiry in relation to a general proposal referred to the Commission by a council or councils under the Division as a debt due from the council or councils.

32C—Inquiries—independence of Commission etc

It is provided that the Commission or an investigator appointed by the Commission is not subject to Ministerial direction in relation to an inquiry or a recommendation or report under the Division (except as provided by the Division).

8—Amendment of section 34—Error or deficiency in address, recommendation, notice or proclamation

This amendment is consequential.

9—Amendment of section 110—Code of conduct for employees

This amendment is technical in nature.

10—Amendment of section 122—Strategic management plans

An amendment to the provisions governing strategic management plans relating to regional collaboration is inserted.

11—Amendment of Schedule 5—Documents to be made available by councils

This amendment is consequential.

Schedule 1—Related amendments and transitional provision

Part 1—Related amendments to South Australian Local Government Grants Commission Act 1992

1—Amendment of section 5—The Account

Section 5(2) of the South Australian Local Government Grants Commission Act 1992 is amended so that amounts may be paid into the Account for the purposes of the Commission's functions under any other Act. A similar amendment is made to section 5(3) relating to the application of the funds of the Account.

2—Amendment of section 14—Staff

The provision relating to the staff of the Commission is extended to include staff for the performance of the Commission's functions under any other Act.

3—Amendment of section 15—Functions of Commission

This amendment allows the Commission to perform functions provided for under any other Act.

Part 2—Transitional provision

4—Transitional provision

A transitional provision is inserted for the purposes of the measure.

Debate adjourned on motion of Mr Treloar.