Transformation Costs Ignored

One of the things that is often ignored in change proposals is the cost of the transformation. We know, from statements made by Minister Simpson, that neither he nor the LGAB has looked at either cost or benefits, but one thing that ought to be blindingly obvious is that transformation costs increase rapidly with the complexity of the change.

With that in mind, let's look at the two latest 'likely recommendations' from the LGAB.

In the case of Melville, the 'new' Melville includes:
- two separate (non-contiguous) areas from Cockburn;
- one area from Fremantle;
- two separate (non-contiguous) areas from Canning; and
- loss of one area to Fremantle.

In the case of Cockburn, the 'new' Cockburn-Kwinana includes:
- loss of two separate (non-contiguous) areas to Fremantle;
- loss of two separate (non-contiguous) areas to Melville;
- addition of a small area from Rockingham; and
- amalgamation of 90+% of Cockburn with Kwinana.

In each case, there will be a need to identify policies, commitments and assets for each of the areas 'changing hands' and somehow deal with them in a equitable way - not always easy, as assets, in particular, have been paid for collectively by the ratepayers of the whole current local government. Policies cannot be harmonised overnight and it is likely that Melville Council, for example, will have to work with four different sets of policies (its own, Cockburn, Fremantle and Canning) for some time.

Ask yourself whether it is likely that the efficiency gains from what are mainly relatively small changes at the edges of Cockburn, Fremantle and Melville will be greater than the costs. You don't need to be a forensic accountant to work out that this is not very likely at all.

So why is the LGAB messing around at the margins? Why is it increasingly fragmenting proposed changes when it is supposed (but failed) to consider costs as part of its assessments?