You wouldn’t be a happy shareholder if the company in which you had equity was targeted for a takeover on terms that did not make sense and did not add up. You’d hold onto your shares until a better offer came along, surely.
So it is a little mystifying as the deadline looms for submissions into the NSW government’s proposed merger of Shoalhaven and Kiama councils that our council hasn’t come out and said, “No deal.”
On the basis of the written proposal, which Mayor Joanna Gash concedes is fundamentally flawed, this merger should be given a wide berth.
First, apart from a very loose projection of a possible $53 million saving over a long term and a sum of around $11 million to compensate for the cost of the merger, the losses apparent in the proposal outweigh the benefit.
A four-year rate freeze only delays an inevitable rate hike down the track. Estimates range from 27 per cent for an average Shoalhaven property up to 50 per cent for more valuable blocks.
Second, the sheer geography of the merged council will present huge challenges for the delivery of services, which are, as anyone whose road home is pockmarked with potholes will tell you, already difficult.
Third, no one enjoys being dragged to the negotiating table under duress. The unreasonable deadline set on public submissions means many Shoalhaven residents simply won’t have the time to engage in the process. While Kiama council has communicated the merger proposal to its residents via two mail-outs, Shoalhaven has left that to its website.
Many local residents are elderly and not computer-literate; many property owning ratepayers don’t reside in the Shoalhaven. This group of people will be left in the dark.
The one public inquiry meeting at which residents can voice their opinions and concerns is scheduled for Wednesday, February 3 at 2pm in Nowra. Ulladulla people will find it difficult to attend while those working will find it almost impossible.
A proposal that omits something as important as Shoalhaven Water simply cannot be taken seriously.
If any credible publicly listed company was presented with a proposal like that, it would laugh it off. If it didn’t, its shareholders would revolt.
We might have seen the beginning of that revolt on Wednesday night.