Pending regional council amalgamations will not go ahead, but those already merged will stay that way, the NSW state government announced on Tuesday.
Tuesday's decision follows more than nine months of legal action waged by a string of councils across the state after the policy was announced by the Baird government last May.
Pressure mounted on Premier Gladys Berejiklian to determine her government’s commitment to the policy after Nationals leader and deputy premier John Barilaro vowed last month to end local government mergers in the bush.
Mr Barilaro's commitment came the day after Mike Baird announced his resignation as premier on January 19, and before the Liberal partyroom had anointed Ms Berejiklian their new leader.
Since taking up the premiership, Ms Berejiklian signalled she would reconsider the policy, promising to listening to the community and, after chairing her first cabinet meeting, declaring “I will fix this”.
The option of plebiscites was initially canvassed as a solution to determine whether mergers in the pending council districts should proceed, but Tuesday's decisions shows this path has been abandoned.
The decision means Bombala will remain in the Snowy Monaro Regional Council, with elections due in September.