The NSW Court of Appeal has overturned the NSW Government’s bid to merge Ku-ring-gai and Hornsby councils.

The Court of Appeal upheld Ku-ring-gai Council’s appeal against its forced amalgamation on the grounds that the former Local Government Minister’s decision to proceed was fundamentally flawed.

At the heart of the issue was the Government’s failure to release in full a KPMG report which the Government claimed demonstrated significant financial benefits of amalgamation.

The Local Government Act includes financial advantage or disadvantage as a key criterion which must be considered by any delegate tasked with investigating an amalgamation proposal and forming a recommendation for Government.

Two of the three Appeal Court Judges held that the delegate for the Ku-ring-gai-Hornsby merger could not properly determine financial advantage or disadvantages because the report was not made available to him.

The NSW Government has withheld the KPMG report to date.

However, the judges in the case said that the public interest in releasing it far outweighed any claims to confidentiality.

Local Government NSW President Keith Rhoades said the Government appeared to have become a victim of its own secrecy.

“The old saying is that loose lips sink ships, but in this case it looks like secrecy and a lack of transparency has done a job on the SS Forced Council Amalgamation,” he said.

“Today’s judgment poses a real problem for the Government, because every delegate for every forced amalgamation that has taken place relied on this unseen KPMG Report.”

Councils still awaiting the decision of the courts include Burwood, Canada Bay and Strathfield; Hunters Hill, Lane Cove and Ryde; Mosman, North Sydney and Willoughby; and Randwick, Waverley and Woollahra.

“Unsurprisingly those councils mounting court challenges feel pretty vindicated today,” Cr Rhoades said.

The Court of Appeal today also confirmed that the delegate did not assess the merits or otherwise of the boundary change which shifted part of Hornsby Shire south of the M2 motorway to the City of Parramatta Council.