The NSW Government has announced that it will not be proceeding with the forced amalgamation of the councils challenging the mergers in court.

In December 2015, the Government announced plans for 35 forced mergers, which would have reduced the number of councils across the state from 152 to 112. Following a string of legal challenges, the Government reduced the plan to 19 mergers, before abandoning the policy entirely last month.

The NSW Premier and Minister for Local Government attributed the policy decision to the “protracted nature of current legal challenges and the uncertainty this is causing taxpayers”. The proceedings brought by Woollahra Council were due to be heard in the High Court in October, after a special leave application was granted in May.

The change in policy follows the decision by the Government in February to suspend the forced merger of regional councils.

The proposed merger of the following 14 councils into 5, will not proceed:

  • Burwood, City of Canada Bay and Strathfield Municipal councils
  • Hornsby Shire and Ku-ring-gai councils
  • Hunters Hill, Lane Cove and City of Ryde councils
  • Mosman Municipal, North Sydney and Willoughby City councils
  • Randwick City, Waverley and Woollahra Municipal councils

All merged councils throughout NSW will stay merged. Local government elections for all merged councils, as well as the 14 affected by the Government’s announcement, will be held on Saturday 9 September.

The policy decision leaves a number of issues unresolved, particularly in relation to the discrepancies in the size of councils across Sydney.

Certain councils opposing the amalgamations have said that they intend to claim back court costs from the State Government. Randwick Council spent $463,365 on preparing its systems for the amalgamation whereas, Woollahra Council has spent around $1 million fighting the amalgamations. There are other councils who assert losses. It has said that it will be seeking full compensation from the government for the costs relating to the preparation.

Hornsby Shire Council claims that it has been disadvantaged by up to $10 million by the mergers as it lost part of Epping to the newly formed City of Parramatta Council.