Welcome to our summer 2019 edition of integrity matters as we lead into the festive season and the holiday break. In this edition we highlight the recent Yarriambiack Shire Council investigation report which represents a significant body of work from my team.

Importantly, the report identifies many issues that are not exclusive to Yarriambiack Shire and provides a good reference guide for councils and public sector organisations that have regional and largely autonomous operations.

Another key article relates to information transmission between the elected council and the council organisation. In many cases the LGI handles, the requests for information and provision and detail of that information becomes a matter of contention and, at times, conflict between councillors and the administration.

In our work we have observed a process that provides transparency and equity around the information process and has assisted councillors and the administration in their role. I thank both Geelong and Surf Coast Councils for sharing their processes.

Finally, I take this opportunity to wish the local government sector all the very best over the holiday period and, in particular, I would like to acknowledge those that work in critical services or functions over this period to ensure your communities are safe.

Until 2020.

Chief Municipal Inspector

The Inspectorate recently published a report detailing findings following an investigation into Yarriambiack Shire Council. The investigation related to specific allegations around council asset and resource use and broader governance arrangements for council operations.

The Inspectorate found:

• a council that had not kept pace with the requirements and expectations of councils as a contemporary organisation and management at the time were complacent
• policies and rigour around community assets and resources were insufficient and the management were complacent.
• many of the issues found in this investigation had the potential for a negative impact on ratepayers and residents of the shire.

There were significant improvements noted in recent months but there were many facets of this investigation that provide learnings for other councils.

Chief Municipal Inspector David Wolf said: “Our work focused on specific allegations where community assets and resources had either not been properly managed or were used to the benefit of individuals, not the community as a whole."

“Our investigation has presented challenges for Yarriambiack Shire Council but we have been encouraged by the willingness to improve and the assistance from administrative and operational staff. This report is a great guide for all council depots and public sector organisations, especially those with remote or autonomous operations."

The report is available on our website.

Under the Local Government Act 1989, Victorian councils are required to review and if required amend an election period policy no later than 12 months before the commencement of each general election period. This must be conducted in accordance with section 93B of the Local Government Act 1989.

The Inspectorate recently sent a short survey to all councils on the adoption of their election period policy.

At the time of publication, 66 councils had reviewed and amended their election period policy (often also known as a caretaker period policy). While 32 councils had adopted a policy outside of the required timeframe, this does not invalidate the policy but is still a breach of statutory requirements.

Eleven councils had not adopted a policy but proposed to do so at an upcoming council meeting.

Common reasons given by councils for not adopting a policy in the required timeframe included:

• councils were not aware of the requirement
• legislation was not clear
• impending introduction of the Local Government Bill
• insufficient staff to carry out requirements.

It was also found that 11 councils had not provided the policy to the community, through posting on their public website or other means, despite this also being a requirement under the Act.

Operations Manager Ross Millard said while 40 percent of councils had not complied with the Act, there was some useful feedback gained from the survey, such as councils’ lack of awareness of the timeframes or identifying a lack of resourcing or knowledge on compliance.

“This proactive work is intended to assist councils in complying with legislative requirements. We are analysing the information provided to determine any reforms to processes or the legislative framework,” Mr Millard said.

The Inspectorate will collate and provide any relevant information to the Minister for Local Government.

The County Court upheld four charges of misuse of position following an appeal by former Murrindindi Shire councillor Chris Healy in late October. This outcome reinforced the importance of the office of councillor and the laws in place to make sure information is not misused.

His Honour Judge Paul Higham heard the appeal in September in Melbourne’s County Court. Mr Healy was found guilty with four charges proven and one charge being dismissed. In sentencing on Monday, 21 October 2019, Judge Higham ordered Mr Healy pay a $7500 fine and contribute $35,000 towards the prosecution legal costs. His Honour, in an exercise of discretion, did not impose a conviction.

Judge Higham observed that in Victoria, local government depends on the voluntary contributions of councillors and the public must have confidence in councillors as a democratic system. Judge Higham made clear that the position of a councillor must not be used for gain.

Mr Healy had attempted to gain an advantage by making improper use of information acquired while a councillor, regarding Murrindindi Shire’s proposed rating strategy.

The court heard that Mr Healy was privy to information about the tenderers for a rating strategy review, which he used in submissions to council and at a meeting of a local trader and tourism association to argue against a differential commercial rate of 125%. At the time, Mr Healy owned three commercial properties in Eildon.

The Inspectorate began its investigation in March 2015 and charged Mr Healy in April 2017 with misuse of position under section 76D(1) of the Local Government Act 1989.