By Julian Bajkowski

The New South Wales state government has ushered in the start of a fresh financial year by warning the state’s councils they must now comply with sweeping new powers that give Local Government Minister Don Page the ability to suspend dysfunctional municipalities.

Councils across the state on Monday were issued with a circular by the chief executive of the Division of Local Government, Ross Woodward, that Macquarie Street or Mr Woodward can now stage an “early intervention” when the state government believes administration and performance are on the slide.

Mr Woodward’s note to councils said that there was now a “a new approach for addressing dysfunction and poor performance in local councils” which included powers “issue a performance improvement order” and “to suspend a council for up to three months, with possible extension of a further three months if required.”

The crackdown on misbehaving councils comes after years of state government frustration that Macquarie Street could previously do little to immediately remedy or weed out poor administration and performance without entering into costly and length litigation.

A significant part of the changes is that the state government now has a legally sanctioned power to stick its nose into the affairs of councils through what Mr Woodward called “a stronger power to gather information from councils to identify dysfunction.”

Mr Woodward said the new laws “also contains other changes designed to enhance the existing powers of investigation and public inquiry.”

Last month Mr Page was cheering the new laws on in earnest.

“The public frequently calls for Government action when a council is failing. Councils themselves have said they want to put a stop to behaviour that tarnishes the reputation of local government and stops councils delivering for their communities.’’

Mr Page said the laws followed a call by the NSW Auditor General for government to play a stronger role in tackling poor performance of councils and were part of the O’Farrell-Stoner Government’s “integrated reforms of local government” which included a new code of conduct for councillors, the Local Government Acts Taskforce and the Independent Local Government Review Panel.

“The Local Government Amendment (Early Intervention) Bill 2013 provides an important set of tools to ensure that dysfunction is dealt with early and that the democratic leadership of communities is retained,’’ Mr Page said.