Ford government backtracks on amalgamation—which is good news for municipal accountability

The Ford government recently announced it would no longer consider forced municipal amalgamations in Ontario, following recommendations from a review the government commissioned earlier this year. This is good news for local governance, municipal finance and political accountability.

In the 1990s and early-2000s, Queen’s Park pursued a policy of aggressive municipal amalgamation—the merger of local governments—eventually reducing the total number of municipalities to 444, down from over 800.

The logic at the time was that, by reducing the total number of municipalities, local services could be delivered more efficiently and at a lower per-unit cost (thanks to the greater scale of service administration). It was also hoped amalgamation would reduce duplication of service provision or jurisdictional overlap between multiple layers of government.

For example, in 1998 Metropolitan Toronto—a regional municipality—along with its six constituent lower tier municipalities (the former city of Toronto, North York, East York, York, Scarborough and Etobicoke) were merged into the current City of Toronto.

And yet, the hoped-for efficiencies did not materialize. Several indepth analyses in the two decades that followed Ontario’s amalgamations—including work by the Fraser Institute—examined municipal revenue and spending patterns, to test whether forced municipal mergers delivered on the promises touted by Queen’s Park.

In most cases, the per-household tax burden increased, as did spending on certain services and—importantly—government staff remuneration. In many cases, municipal employee wages were harmonized upwards (to match the pre-amalgamation municipality with the highest-paid employees), in turn generating the opposite effect desired by the plan.

Moreover, amalgamation can come at the cost of local political representation. Reducing the number of elected officials (who undergo electoral scrutiny) simply pushes more decision-making to city staff who do not face the same incentives to balance the costs and benefits of their decisions. The larger the municipality, the greater the distance between local decisionmakers and citizens.

Nevertheless, despite the apparent consensus—that municipal amalgamation does not spur greater efficiencies in municipal governance and finances—the Ford government took a leaf out of the past, first by reducing the total number of Toronto city councillors and then by commissioning the review of the province’s eight regional municipal governments (and thus, their potential amalgamation).

Thankfully, its decision to walk away from more forced amalgamations shows that the government is willing to learn from the past rather than commit the same errors of its predecessors. Again, this is good news for Ontarians.