NSW Local Government Minister Paul Toole has released ‘Fit for the Future’ toolkits for NSW councils in the hope that many of them will toe the line and agree to merge by June 30 next year when the applications are due in.

Both the templates and the guidelines for completing them make it clear that rebel councils who buck against the Local Government Independent Review Panel’s recommendations will be viewed dimly.

The panel recommended that 105 of NSW’s 152 councils consider merging and that eight councils in the far west of the state should form a Far West organisation. It also suggested the number of Sydney councils be slashed from 41 to between 15 and 18.

Councils must choose between two templates: template one if they are proposing to merge; and template two if they want to maintain their existing boundaries, which is called a council improvement proposal.

But it’s a firmly guided choice.

Application guidelines for councils tempted to complete template two — and go against the panel’s recommendations to merge — are warned: “If the panel recommended a merger then this is the first option you should consider”.

The Office of Local Government (OLG) has also set up a one-stop shop for councils to help them complete their applications, once again with a heavy accent on mergers.

Councils have been told there are ‘expert facilitators’ on hand to help them sell mergers to residents (‘to help councils begin discussions about merger options and the benefits for their community’) and a panel of experts available to encourage councils to discuss merging (‘bringing councils together to discuss structural change’).

The facilitators come from firms like Ernst and Young, Advanced Dynamics, Elton Consulting and Morrison Low.

Other application assistance offered includes funding consultants to prepare a merger business case and relationship managers and technical support to help councils access the support on offer.

The work demanded from councils to complete either template is not insubstantial.

Merger proposals must include a merger business case, the financial and non-financial costs of a merger, suggested boundary changes, evidence of community consultation and estimates of the anticipated performance of a new super council against Fit for the Future benchmarks, covering areas such as debt servicing, infrastructure backlogs and operating expenditure.

Councils who complete proposals based on their existing structure must explain how they currently hit Fit for the Future benchmarks and demonstrate greater efficiency, sustainability and management through improvement action plans.

Councils who do not follow the panel’s recommendations will be asked to explain why they have not. They are also expected to nail down figures showing the improvement they will make across seven areas, including revenue, asset maintenance and renewal.

Local Government NSW President Keith Rhoades said that his organisation provided comprehensive feedback to the OLG on the Fit for the Future templates but there were still a number of outstanding issues.

“The scale and capacity benchmark in the merger template remains unclear. It almost exclusively focuses on financial indicators,” Mr Rhoades said.

“Community engagement also receives insufficient attention in the template. It’s important councils consult with their communities on this issue, so the outcome of these reforms reflect what communities want and need.”

Mr Rhoades said he understood that Mr Toole would consider alternative proposals but he encouraged councils to submit their proposals well ahead of the June 2015 deadline, in case they were rejected by the government and needed to be revised.

“Having said that, the government’s reform package makes it clear that those councils judged fit for the future will be significantly advantaged over those that aren’t,” he said.

There will be a series of regional workshops in November to work through the details of the materials with general managers.

The state government’s Fit for the Future package includes $258 million for councils that have decided to merge, access to cheaper finance, priority funding, $4 million to help smaller councils find innovative ways of working and $13 million to support transition committees and involve elected representatives in mergers.