Local Government Amalgamation: The Evolution of Devolution

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Alannah Cobb
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1 Local Government Amalgamation: The Evolution of Devolution Adminisitrative Territorial Reform in Albania 17 October 2013, Hotel Sheraton- Tirana David Parks OSCE Local Governance Expert

2 Why so many local governments? Historical reasons Socio-cultural Ethno-political Demographic Current reasons Entrenched political interests Sub-regional identity Status quo Economic considerations not a factor 2

3 Challenges from over-fragmented local government Disproportionate spending on administrative costs Starved capital investment Inadequate spending to promote growth Disparity of service delivery between units Overall inefficiency in public spending 3

4 What is the right number/size of local governments? There is no formula and the size often changes over time. Influenced by asymmetrical administrative and fiscal capacity. Threshold often determined by level of development and economic situation. Establish a balance between political representation and economy of scale. 4

5 Pressures for local government amalgamation Unsustainable fiscal situation Weak institutions Negative demographic trends Limited administrative capacity Stalled large development projects 5

6 Dimensions of local government reform. Constitutional Jurisdiction (exclusive/shared) Asymmetry? Relationship to other levels of government Fiscal Own source revenues Sharing of revenues and/or tax base Economic efficiency 6

7 Dimensions of local government reform Political Representation Accountability Participation Administrative Expansion of service delivery area Coordination of human resources Harmonization of systems 7

8 Institutions to Manage Amalgamation Intergovernmental meeting spaces to coordinate reform processes. Local offices of central government ministries. National training centres for municipal officials. Spaces for citizen input into amalgamation planning and implementation. 8

9 Reform from below: the case of Western Australia 9

10 Reform from below: the case of Western Australia Consultative (led by regional government) Voluntary rather than forced. Based on 10 and 20 year population projections Accommodates existing communities of interest Incorporates a variety of solutions: Boundary changes (annexation) Absorption Creation of new local governments 10

11 Reform from below: the case of Western Australia Funding for training and planning provided to each newly amalgamated or created government. Staff employment guarantee for two years after amalgamation (buyout/severance option). Metropolitan Reform Implementation Committee Chaired by Ministry of Local Government Drives implementation and monitors progress. Invites participation from one Mayor or Councillor from each affected local government. 11

12 Forced amalgamation: Ontario, Canada 12

13 Forced amalgamation: Ontario, Canada Municipal governments are creatures of the province, explicit hierarchy. High degree of civic opposition to amalgamation within urban areas (Toronto, Ottawa, Hamilton). More popular support in northern and rural areas. Decreased from 815 to 444 since Regional governments (federations of municipalities) 13

14 Forced amalgamation: Ontario, Canada In large areas of very low population, Area Service Boards deliver coordinated services across municipalities. Ongoing debate on amalgamation vs. inter-municipal cooperation. Public polling reveals divided opinion on service delivery improvement Expanded tax base, but has created political distortions. 14

15 Conditions and Tools for Successful Amalgamation Local financing and fiscal authority are linked to functions and responsibilities of the local government. Local community should be informed about the savings generated by amalgamation and improvements in service delivery. Political space for citizens to participate in amalgamation planning. 15

16 Conditions and Tools for Successful Amalgamation Transparency and accountability mechanisms so that community can monitor local government performance. Realistic timeline for reform, typically a minimum of 1 year. Change management strategies to smooth transition for affected local government workers. 16

17 Contact information David Parks OSCE Governance Expert 17

Overview of the Greater Toronto Area

Overview of the Greater Toronto Area Presentation to the Atlanta Leadership Delegation Mississauga, Ontario May 6, 2015 Enid Slack Institute on Municipal Finance and Governance University of Toronto Outline