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6Councilsoriginallyfocusedonthe3Rsofroadsrubbishandrates.AnewLocalGovernmentActin1993hadtheex12ectoflix13ingtheroleto8Rsincludingroadsrubbishregulax1fonrecreax1fonreliefregionalismretailandrates.TheLocalGovernmentSectorAustralianlocalgovernmentsexpendonly2ofGDPcomparedto8intheUSA12intheUKandEuropeand15inJapan.Clearlydix19erentservicesareundertakenindix19erentpartsoftheworld.Australiax19scouncilsarealsobigbyworldstandards.YetbyaveragenumberofresidentsservedAustralianlocalcouncilsarebyfarthelargestinthedevelopedworld.Inotherwordscomparedwithothercountrieswehavefewerlocalcouncilsrelavetoourpopulaonsize.TheNSWLocalGovernmentInquiryof2006foundthattherewasnoevidenceineitherAustraliaoroverseasthatthesizeoflocalcouncilsboreanyrelaonshiptoitsunitcostswhichiswhythereportdidnotrecommendcouncilamalgamaons.Therearestrongargumentsformorex1aexibleandspeediercontractcouncilsemployingasmallfull-mepolicyThefollowingchartwasproducedbytheIndependentLocalGovernmentInquiryof2006.Itshowsthereisaverylowcorrelaonabout27betweenanurbancouncilx19spopulaonsizeanditspercapitaoperangexpenditure.x18ApeculiarfeatureofAustralianamalgamaonwarsisthatalltooox1beninquiriesandreportsareessenallyx1cfact-freex1dandsimplyassertthemanifoldadvantagespurportedlyx1aowingfromsize...Howeversomemesinvesgaonsintostructuralreformdoengagewithavailableempiricalevidenceonscaleandevenaempttoesmatethemagnitudeofscaleeconomies.TheTasmanianPropertyCouncilDeloiereportisanexampleofthisrarebreed.ButunfortunatelyreportsofthiskindalmostalwaysrepeatthesamefundamentalerrorintheirempiricalesmaonsofscaleeconomiesandthisisregreablyalsotrueoftheDeloieex19ort.advisoryplacemanagementandprocurementsecretariattooversightservicesdeliveredbyspecialistexternalproviderssharedservicecentrestemporarystax19andpart-mecontractors.TheMergerMythProfessorBrianDolleryDirectoroftheCentreforLocalGovernmentattheUniversityofNewEnglandrecentlysummeduptheproblemwithpro-amalgamaonreportsproducedbystategovernmentsandotherparesthatassumebiggerbureaucraciesalwayslowercosts.AverageRatesversusCouncilSize-TheratesarehigherforlargercouncilsAustralianlocalgovernmentsexpendonly2ofGDPcomparedto8intheUSA12intheUKandEuropeand15inJapan.LocalGovernmentExpenditureasaPercentageShareofGDP2006AverageSizeofLocalGovernmentBodiesbyPopulationinFederalSystems2000