Tuesday, 7 March 2023
Bills
Local Government (Moira Shire Council) Bill 2023
Local Government (Moira Shire Council) Bill 2023
Introduction and first reading
The DEPUTY PRESIDENT (14:20): I have a message from the Assembly:
The Legislative Assembly presents for the agreement of the Legislative Council ‘A Bill for an Act to dismiss the Moira Shire Council, to provide for a second general election for the Moira Shire Council, to make consequential amendments to the Local Government Act 2020 and for other purposes’.
That the bill be now read a first time.
Motion agreed to.
Read first time.
Lizzie BLANDTHORN: I move:
That the bill be treated as an urgent bill.
Motion agreed to.
Statement of compatibility
Lizzie BLANDTHORN (Western Metropolitan – Minister for Disability, Ageing and Carers, Minister for Child Protection and Family Services) (14:21): I lay on the table a statement of compatibility with the Charter of Human Rights and Responsibilities Act 2006:
Opening paragraphs
In accordance with section 28 of the Charter of Human Rights and Responsibilities Act 2006, (the Charter), I make this Statement of Compatibility with respect to the Local Government (Moira Shire Council) Bill 2023.
In my opinion, the Local Government (Moira Shire Council) Bill 2023 as introduced to the Legislative Council, is compatible with human rights as set out in the Charter. I base my opinion on the reasons outlined in this statement.
Overview
The proposed Local Government (Moira Shire Council) Bill 2023 (Bill) will dismiss the Moira Shire Council (council) and provide for the appointment of an Administrator or Panel of Administrators for the council.
This follows the report of the Commission of Inquiry into Moira Shire Council which was provide to me on 26 February 2023. The report describes significant governance failures by the council and its administration and finds that governance of council has deteriorated to the point where it can no longer effectively carry out its responsibilities in accordance with the Local Government Act 2020. The report recommended the dismissal of the council until October 2028.
As such, I seek the dismissal of elected councillors at the council for at least 5 years to ensure the restoration of good governance at the council in accordance with the Local Government Act 2020.
The proposed Bill dismisses the council until October 2028.
Human Rights Issues
Human rights protected by the Charter that are relevant to the Bill
Taking part in public life
Section 18 of the Charter establishes a right for an individual to, without discrimination, participate in the conduct of public affairs, to vote and be elected at State and municipal elections, and to have access to the Victorian public service and public office.
The right to participate in the conduct of public affairs broadly relates to the exercise of governmental power by all levels of government, including local government. The right to be elected ensures that eligible voters have a free choice of candidates in an election and, much like the right to vote, is not conferred on all Victorians, but is limited to eligible persons who meet certain criteria. The processes for the appointment, promotion, suspension and dismissal of candidates and councillors are objective, reasonable and non-discriminatory.
Clause 5 (in dismissing the Moira Shire Council) and amendments to the Local Government Act (providing the next general election for the Moira Shire Council will not occur until October 2028), clearly engages the right to take part in public life under section 18 of the Charter.
In this case, the purpose of the limitation is to enable the restoration of good government at the council. Given the significant issues with the Moira Shire Council and the work that is to occur so that it may operate adequately, the limitation is reasonable and justified in a free and democratic society under section 7(2) of the Charter Act.
In April 2022, Ms Marg Allan was appointed as a municipal monitor to the council to review and oversee governance processes and practices on the basis of concerns that had been raised by the council Mayor, Chief Executive Officer and other parties.
On 7 October 2022, Ms Allan identified serious concerns that the leaders of Moira Shire Council were not performing in their roles as is expected or required of them. Further, that there were numerous governance issues and alarming reports in relation to staff safety. This report recommended further intervention was warranted to establish a culture of good governance.
As a result, a Commission of Inquiry comprised of Ms Frances O’Brien KC (Chair) and Mr John Tanner AM was appointed on 28 October 2022, to conduct an inquiry into the council and the Commission provided its final report on 26 February 2023.
In summary, the Commission’s report finds that the governance of Moira Shire Council has deteriorated such that the council can no longer effectively carry out its responsibilities in accordance with the Local Government Act 2020.
The report describes significant governance failures by the council and its administration, including in relation to its management of the performance of its Chief Executive Officer, in ensuring the health and safety of its employees and in giving effect to the financial management principles and community engagement principles under the Local Government Act 2020.
The report further identifies instances of how the council’s failures and neglect have adversely affected members of council staff and the Shire community. This includes the council’s and the administration’s actions in transferring asbestos contaminated waste to unlicensed waste stations constituted serious misconduct, putting staff and residents at potential risk of exposure to asbestos; and the delayed implementation of already approved flood mitigation measures, leaving the township of Numurkah and its residents at serious risk.
The report also describes how the council Chief Executive Officer failed in several of her duties including to comply with the council’s Employee Code of Conduct and mandatory notification of suspected corrupt conduct to IBAC, and to exercise responsible oversight of human resource management practices in breach of the Occupational Health and Safety Act 2004.
The Commission recommended the council be dismissed until 2028. This can only be achieved through legislation.
The serious nature of the Commission’s findings justifies the dismissal of the elected councillors. In addition, the Commission recommends an extended period of administration to October 2028 to ensure there is sufficient time to address the issues raised in its report and provide for the restoration of good governance at the council in accordance with the Local Government Act 2020. This action therefore ensures and recognises the right of electors to be represented with probity, integrity and accountability, and in the interests of the community.
Removal of an elected council is always a matter of last resort and undertaken only in the most serious of circumstances. While it is regrettable that this is necessary, the Government has a responsibility to protect communities from governance failings by their local representatives.
The Local Government Act 2020 provides a less restrictive and more immediate measure, namely suspension pursuant to section 230(1). However, section 230 is not appropriate in this case because it provides for suspension for a maximum period of 12 months, indicating the provision is intended for circumstances in which a short interruption to elected representation will be sufficient to overcome the failures identified.
However, as the Commission’s report demonstrates, the circumstances require the removal of democratic representatives for at least five years.
Privacy and Reputation
Section 13 of the Charter provides that a person has the right not to have his or her privacy, unlawfully or arbitrarily interfered with, and not to have his or her reputation unlawfully attacked.
Clause 5 of the Bill provides for the dismissal of the elected councillors, and therefore purports to restrict the right under section 13 of the Charter.
Any interference with a person’s privacy and reputation is lawful and not arbitrary in this case. The decision to remove the councillors from office follows the appointment of a municipal monitor to the Council and is pursuant to the recommendations of a Commission of Inquiry.
The serious nature of the issues identified at the Council by the Commission, as identified above, clearly warrant the immediate removal of the councillors.
The Hon. Lizzie Blandthorn MP
Minister for Disability, Ageing and Carers
Minister for Child Protection and Family Services
Second reading
That the bill be now read a second time.
Ordered that second-reading speech be incorporated into Hansard:
This Bill will dismiss the Moira Shire Council and provide for the appointment of an administrator or panel of administrators in response to the recommendations of the report from the independent commission of inquiry into Moira Shire Council.
A municipal monitor, Marg Allan, was appointed in April 2022 under section 179 of the Local Government Act 2020 to monitor, advise and support the governance processes and practices of the council. This appointment was to assist the council in addressing a number of significant governance issues raised by the council Mayor and Chief Executive Officer and other parties.
On the 7 October 2022 the monitor provided her confidential report to me. The report found that the councillors of Moira Shire Council were “not performing in their roles as expected or required of them”. Further, neither the Mayor nor the CEO were “performing their role as required or expected” and that “the Councillors are unable to properly manage the CEO”.
The monitor further reported that Moira Shire Council had numerous governance issues, a poor organisation culture with alarming reports of staff safety and culture, and poor community engagement practices and financial management of capital works. The monitor concluded that any improvements were likely to be lost once the monitor’s term expired. The monitor noted that she had referred a number of matters to the Local Government Inspectorate, however they would take time for their investigation to be complete.
Finally, the monitor concluded that “due to the significance and extent of the issues at Moira Shire”, she had “formed the view that further intervention beyond the appointment of a monitor is warranted, to establish a culture of good governance”.
The municipal monitor was initially appointed until 31 January 2023, however following such an alarming report I appointed a Commission of Inquiry under section 200 of the Local Government Act 2020. The Commission was established on 28 October 2022 to conduct an inquiry into the affairs of the Moira Shire Council, and the monitors appointment ceased.
The terms of reference saw the commissioners’ focus on the advice provided by the municipal monitor and the Australian Services Union as well as on matters affecting Councillors’ and the administrations performance of their roles. This was to include the efficiency and effectiveness of governance arrangements in delivering services to its constituents, including financial management and community engagement practices.
The commissioners were required to report back to me by 28 February 2023 and provided their final report to me on 26 February 2023. I have tabled the commissioners’ report, which attaches as appendices the monitor’s final report and the Australian Services Union’s letter.
The commissioners’ report finds that governance of council has deteriorated such that it can no longer effectively carry out its responsibilities in accordance with the Local Government Act 2020.
The report also finds that the Chief Executive Officer failed in her duties including to comply with the council’s Employee Code of Conduct, and to exercise responsible oversight of human resource management practices in breach of the Occupational Health and Safety Act. The council in turn failed to manage the performance of the Chief Executive Officer.
The report further finds that the council and its administration failed to take necessary action to ensure the health and safety of employees; managed the transfer of asbestos contaminated waste in a manner that constituted serious misconduct and risked the health of staff and residents; delayed implementation of already approved flood mitigation measures, leaving the township of Numurkah and its residents at serious risk; failed to act in accordance with the financial management principles contained in the Local Government Act through the mismanagement of two major capital projects; and failed to provide adequate community representation and to apply the community engagement principles of the Local Government Act 2020 on a Shire wide basis.
The issues identified in the report, which have not been resolved, raise serious concerns about the effectiveness of the council to govern the municipality. The commissioners concluded that the proper functioning of the council needs to be restored, and that there needs to be a break in democratically elected representation at the council for at least five years.
The Bill will dismiss the council and appoint administrators to perform the powers, functions and duties of the council until a new council is elected.
The Bill provides for the next general election for the Moira Shire Council to be held in October 2028, ensuring there is sufficient time to address the issues raised in the commissioners’ report while balancing the strong community interest in having democratically elected representatives.
Dismissing a council by Parliament is the most extreme intervention by the state and is only undertaken in the most serious cases of governance failure. This government is taking the conduct of councils seriously by intervening early to prevent serious governance failures but acting decisively when councils fail their communities.
The issues identified in the commissioners’ report including the council’s abject failure to make decisions and take appropriate action that ensured the health and safety of employees and residents, failure to provide adequate community representation, and major procurement breaches and mismanagement of key capital works, demonstrate extremely serious governance failures warranting the dismissal of the council.
Without this Bill, there is a risk of further deterioration of the governance at the council and the probity, integrity and accountability expected of local government.
The community and Parliament expect the highest standards of governance, probity and representation from their councillors and council staff. This Bill will ensure good governance in Moira is restored to provide the community the leadership they deserve.
I commend the Bill to the house.
The DEPUTY PRESIDENT: Members, an urgent bill motion has passed, pursuant to standing order 14.35. The purpose of this motion is that the next stage following the tabling of the statement of compatibility and the minister’s second-reading speech take place forthwith rather than being adjourned to a future day. In other words, leave is no longer required for the second reading to take place forthwith. Therefore, when I call the next speaker, they cannot move to adjourn the debate but must instead make their second-reading contribution.
David DAVIS (Southern Metropolitan) (14:22): I will not say I am pleased to rise and speak about this bill. It is a very difficult bill because it removes a local council and removes democracy from a local community. I was briefed this morning about these matters, and I understand some of the issues that have arisen at Moira Shire Council. There has been a significant deterioration in governance at the council. The council has failed to properly manage its CEO. There is a long list of health and safety issues, and it has left Numurkah residents and the town at serious risk in the event of a major flooding incident by delaying the implementation of approved flood mitigation measures. There have been a number of capital projects that have been mismanaged, and it has failed to provide adequate community representation and meet its obligations under the Local Government Act 2020. There are specific points made about the CEO in the report from the commission of inquiry, as has been tabled in the chamber just today. I think the community will be very surprised and disappointed at what has occurred.
These issues where governance at a local level has failed are very difficult. None of us wants to see the removal of local democracy, and none of us wants to see a situation where a council is removed and administrations of various types put into place. In this case there was a meeting with the local government minister and Moira council mayor and CEO to discuss concerns on 11 March 2022. There was a letter from the Minister for Local Government to Moira shire requesting the provision of a plan by 30 June. That was sent in March 2022. There was the appointment of Marg Allan as a municipal monitor on 22 April 2022. There was a confidential report of the monitor provided to the minister on 7 October and the appointment of a commission of inquiry on 28 October, and obviously that report was provided to the minister on 26 February and brought to the chamber today. But also a bill has been presented today to the lower house first and now to this chamber. I think there is a strong case, and I think that a number of areas of the council’s responsibility have been maladministered. The commission-of-inquiry report reading makes a reasonable person very concerned about the future of administration of the council. There have been work health and safety issues, there have been failures of governance – it is a long and torrid list.
In conceding that and indicating that the Liberals and Nationals will support the bill, I do want to make some points. This is now becoming an increasing practice under this government. When I was first elected to Parliament it was a very rare thing to see councils removed – a very rare thing indeed. I think it is important to get onto the record this increasing intervention by government. I make the point that some of these interventions are justified, including this one, but there does seem, when you look at the list – the number of monitors appointed, the number of council dismissals under this government – to be a pattern that is building. You have got to ask why local government is having these challenges and why local government is being so routinely overridden by these interventions. I think this is an important list.
I am going to talk about the City of Greater Geelong here first. There were monitors Digby and Dorling appointed on 3 February 2023, but that was after an earlier ousting at Geelong city council, which had been dismissed on 14 April 2015 and had monitors Munro and Dorling appointed in 2017. That was a reappointment, so I regard that as two episodes of appointment. Horsham Rural City Council had a monitor, Jude Holt, appointed on 22 July 2022. Yarra council had two sets of appointments of Yehudi Blacher, who was appointed on 14 December 2021 and extended on 22 June 2022. Darebin, Moira and Wodonga councils had monitors appointed on 26 April 2022, with John Watson at Darebin, Marg Allan at Moira and at Wodonga Janet Dore. That is a series of appointments there. The City of Whittlesea had a monitor appointed, Yehudi Blacher, on 13 December 2019, and the council was dismissed on 19 March 2020. The City of Casey had a monitor, Laurinda Gardner, appointed on 27 November 2019, and the council was dismissed on 18 February 2020. Strathbogie shire had a monitor, Janet Dore, appointed on 9 September 2019. South Gippsland shire had a monitor appointed, Peter Stephenson, on 18 June 2018, and he was dismissed on 19 June 2019. Frankston City Council had a monitor, Prue Digby, appointed on 12 December 2017. Central Goldfields was dismissed on 23 August 2017. And as I said, Geelong council was dismissed on 15 April 2015 and then had a monitor appointed after it came back in 2017, who was reappointed later.
So that is five council dismissals in the last two terms of government and this small part of this term and at least 13 monitor-appointment cycles. These are quite unusual historically, as I say, these interventions. It has traditionally been a very rare thing for a council to be dismissed and a very rare thing for some sort of overarching appointment of this type. I am quite clear on the point that the removal of this council is justified and supported by the opposition, but we do note this increasing trend of monitor appointments and reappointments and this increasing trend of sacking councils. If I was the Municipal Association of Victoria (MAV), I would be asking questions about this.
There is a whole set of different questions here; some of it is the model. There is no ward structure in this particular council’s case, which is a part of the problem. The weighting of councillors has been uneven across the municipality, and I think that that does create certain problems. An undivided ward situation in this case is at least a partial contributor to the issue. So there are structural issues that may be at play, but also what is it about this government that seems to have allowed so much trouble to occur at local government level? What is it about this government that has seen these repeated sackings of local councils?
I do want to say that I am a supporter of local government. Both the Liberals and the National Party are supporters of local government, and we see the importance of local government. When I was health minister I had a very good relationship with the MAV and councils, because we delivered a lot of important services through councils. That ability to deliver services at a local level with local engagement in the community is a strength of the Victorian system. Whether it be food health and safety and food matters or whether it be vaccine programs or whatever, councils are close to the people and are in a position often to deliver services and programs more effectively than a central agency run from Melbourne. But I have to say that trend appears to be in some trouble with this government and this overriding need, it seems, to intervene in local government through the appointment of monitors and the sacking of local councils.
I pay tribute to the commissioners and the work that they have done. I was appreciative of the opportunity to be briefed, but nonetheless I have to say they certainly persuaded me about the issues at Moira and the course that has been embarked upon by the government here. So with those caveats, the opposition will support this bill, but we do sound a longer term warning about what we see as effectively an attack on local government through the appointment of numerous monitors and repeated sackings.
Sarah MANSFIELD (Western Victoria) (14:33): I too find it incredibly disappointing to be in this position, considering the dismissal of a council. The findings in this report are disturbing. I was also afforded the opportunity to have a briefing this morning – and I am grateful for that briefing – to be brought up to speed with the commission-of-inquiry report. Good governance is essential for the proper functioning of councils so they can serve their communities. Council staff deserve a safe workplace, and the community deserve to have trust in those who are representing them. While it is very unfortunate that the Moira Shire Council has reached this stage, we understand, based on this report, that the minister feels they have few options at this stage but to dismiss the whole council. We also understand that the systemic nature of the governance failures and the cultural problems in the council mean that dismissing individual councillors was not deemed an appropriate response. These are not decisions that should be undertaken lightly. Dismissing a democratically elected government is a very serious step.
Notwithstanding the seriousness of the concerns in this case, we do sympathise with the comments made by Mr Davis just now about the increasing pattern of intervention in local government, which one could say is potentially having an undermining effect on the sector. We have seen several such dismissals in recent years, and the decisions have typically been brought to the Parliament in similar circumstances: there is an urgent need to suddenly dismiss a council with very little time for MPs to be adequately briefed or explore alternative options. Given we are being asked to make such important decisions in these circumstances, we would request that in the future other MPs in the Parliament are provided with adequate information in a timely manner. While the minister only received the report last week, many of the findings within that report will not have come as a surprise. There has been a monitor in place for quite some time who would have been providing the minister with regular updates. There was a commission of inquiry launched in October, and again there would have been serious concerns that led to that inquiry being commissioned. Keeping us informed when serious concerns are developing about a council would allow us to have greater input to the process and at least make more informed decisions if we are again presented with a request to dismiss a council.
I also note that the government want to appoint administrators for a period of five years. That is a very long time to be without a democratically elected council. While again in this case we recognise that there are deep issues identified in the report and they will take some time to rectify, there must be a strong focus on returning democracy as soon as possible in these situations.
Motion agreed to.
Read second time.
Third reading
Lizzie BLANDTHORN (Western Metropolitan – Minister for Disability, Ageing and Carers, Minister for Child Protection and Family Services) (14:36): I move, by leave:
That the bill be now read a third time.
Motion agreed to.
Read third time.
The DEPUTY PRESIDENT: Pursuant to standing order 14.28, the bill will be returned to the Assembly with a message informing them that the Council have agreed to the bill without amendment.