“I stand by the figures put forward by Queensland Treasury Corporation on the costs for Douglas to de-amalgamate from Cairns Regional Council."

That's the response from Local Government Minister David Crisafulli over doubts raised by pro-de-amalgamation lobby group Friends Of Douglas Shire (FODS) about the $8.146 million price tag to split from Cairns Regional Council .

The Minister said there had been extensive research undertaken which took into account figures provided by both Cairns Regional Council and FODS.

“QTC has had a team working full time to come up with accurate costs based on information collected from both the proponents and the Council.

“They have no vested interests, are totally independent, and have a vast amount of experience working with local governments over many decades.”

But FODS' Michael Gabour said in a speech at a Port Douglas Chamber of Commerce luncheon yesterday that Mr Crisafulli had approved the referendum "mainly because the FODs have raised serious questions about the financial case presented by the Boundary Commissioner and the QTC."

He said a disclaimer in the report 'De-amalgamation Analysis of Cairns Regional Council' prepared by QTC was evidence that there was reason to doubt the figures.

"I don’t know about you guys but a report that contains the following disclaimer makes be a bit nervous, and I quote:

The information in this Report is provided by QTC in good faith in relation to the information available at the time of its preparation and on the basis of information supplied to QTC by the Department, the Commission or third parties. QTC has not independently verified the information supplied to it and accordingly does not represent that the information contained in this Report is accurate or complete and it should not be relied upon as such. QTC is under no obligation or duty to notify anyone if there is any change in any information or any new information or if it forms a different opinion at any time after the date of this Report.

"Now I’m not having a go at the QTC but this is the same bureaucracy that claimed amalgamation would result in major savings in the delivery of services due to economies of scale," Mr Gabour said.

"They never quantified what those savings were meant to be but I challenge anybody to produce a skerrick of information identifying any savings.

"The costs of providing services to Douglas have skyrocketed since amalgamation and I am fairly certain that those inflated operational costs form the basis of the QTC analysis."

Mr Gabour said FODS will look to enlist the services of an economist to "provide a blueprint on the most cost effective path forward."

The following is an excerpt taken from the Boundaries Commissioner Report:

Douglas De-Amalgamation Financials

1. Queensland Treasury Corp (QTC) first year cost to de-amalgamate: $8,146,000.

2. This includes $2,336,000 for one-off costs; $2,119,000 for total one-off fixed asset costs; and $3,691,000 total incremental annual recurring costs.

One-off costs include:

• Planning and implementation costs
• Costs of recruiting senior executives
• Community and staff engagement costs, including uniforms
• Legal, accounting and finance due diligence costs
• New ICT costs (fees for data migration and transitional project costs)

Total one-off fixed asset costs include:

• New ICT assets
• New property, plant and equipment

Total incremental annual recurring costs include:

• Councillor remuneration
• Salaries and wages costs for additional staff
• ICT costs
• Insurance costs
• Service delivery costs
• Diseconomies of scale, including loss of purchasing power

3. Average extra cost to a rates bill over five years: $701 per ratepayer in the first year, then an estimated $462 extra each year thereafter, rising with inflation.

4. QTC Council financial rating if split occurs: New Douglas Shire Council – Very Weak