A NSW MP has come up with a plan to avoid the state’s controversial Fit for the Future reforms, and it has already been labelled “illogical”, “crazy”, and “ridiculous”.

Lake Macquarie Independent MP Greg Piper has a plan that would see Gosford Council merge with southern parts of Wyong Council, while Lake Macquarie would be extended to include northern Wyong, and Newcastle joins Port Stephens.

The idea to form three ‘super councils’ is being pitched as an alternative to the Fit for the Future reforms that are calling for Newcastle Council to merge with Lake Macquarie.

Newcastle Liberal councillor Brad Luke has lashed out at the suggestion that the joint ownership of Williamtown airport between Newcastle and Port Stephens makes it a logical merger.

“The airport business is owned by the two councils, but it's simply a separate business that operates and pays a dividend,” he told the ABC.

“It is no different to saying we have money invested in the same bank.

“There's no logic in it, there's no synergy between Port Stephens and Newcastle simply because we own an airport.”

Port Stephens mayor Bruce MacKenzie described Mr Piper's plan as “crazy and ridiculous”.

He says Port Stephens Council is perfectly stable financially.

“A crazy, ridiculous idea,” he told reporters.

“Lake and Newcastle are not deemed to be ‘fit for the future’.

“We are - we are in a sound financial position, we are very soundly managed.

“Newcastle and Lake Macquarie probably put up their rates eight per cent, compounding each year.

“What do we do - CPI - the minimum amount we put up.

“We can manage that because we are well managed.”