Glen Eira Debates

The Glen Eira Audit Committee Charter (Council Minutes: 22^nd July, 2008) states:

Term of Membership
Independent members of the Committee are not officers or employees of Council and have no executive powers. Independent members shall be appointed for an initial term of three (3) years after which time they will be eligible for reappointment. No independent member is to be appointed for more than two consecutive three year terms unless Council resolves otherwise. Terms will be scheduled to facilitate continuity of the Committee such that no more than one Councillor and one independent member’s terms cease within the one year”

The current independent members of the Audit Committee (Gibbs and McLean) have been on the committee since at least 1997 in Gibbs case, and McLean possibly soon after. That makes it roughly 14 years straight – and now it looks like they may have been granted another 3 year ‘extension’ bringing the grand total of consecutive service to close on 17 years! Even more disquieting is the way in which these reappointments have been handled – all executed via single, camouflaged one liners in Council agenda items.

The in camera items of February 22^nd,  2011 read: “under s89 (2)(a) “personnel” which relates to Audit Committee Membership”. Identical items are noted in the minutes of: 22^nd May, 2006; 8^th April, 2008; 24^th February, 2009 and the 17^th March, 2009. So it appears that each time either Gibbs or Mclean’s term of service is close to finishing, there appears this single innocuous and buried item that is voted on in camera. Yes, this fulfils the legal requirements of a ‘council decision’, but we have to ask:

1. Why is this done in secret? Why is there no public announcement of reappointment? Why is there no recommendation from the audit committee that is minuted? Why on earth does such an item deserve the classification of ‘confidential’ unless the intention is to keep this from the public?
2. Why does every other council we have looked up include such items in their Audit Committee minutes (ie. recommendation to reappoint or advertise) and some even issue a media release on the subject. Yet, Glen Eira is always silent, always secretive.
3. Why does Newton insist on this practice – since he alone declares an item to be ‘confidential’ and determines that it be listed for in camera discussions?
4. What of all the other councillors? Do they question? Do they want to know why the reappointment is so ‘secret’? Does anyone even think that 17 years of the same independent members of an Audit Committee is not according to current best practice and especially the recently released Minister’s Guidelines? Or is the simple fact that amidst the mountain of papers landed in councillors’ laps, this one single sentence is somehow engineered to escape notice?
5. What does Newton have to gain by such secrecy? And what does this do to the public’s perception of the governance practices within Glen Eira?

Perhaps a few interesting examples from the minutes of Glen Eira’s Audit Committee meetings require reflection by residents –

Feb 5^th, 2008 – “Mr McLean suggested that for future audit reports the internal auditor’s comments could be more positively stated. For example, under item 1 “Total purchase from vendors” on page 2 of the report, the wording “all the above appeared to be reasonably justified” be changed to “all the above were justified”. 

14^th December, 2010 – “The Chairman stated that he and Mr McLean would meet separately with Management to discuss further enhancement of the BCP (Business Continuity Plan) documents.” 

Secrecy is the hallmark of Glen Eira and as we’ve said, the modus operandi of its administration. But it relies on complicit and compliant councillors in order to succeed. The result is to the detriment of the community and to the principles of accountability, transparency and good governance.

We have long maintained that the modus operandi of Glen Eira Council is secrecy and more secrecy.  In particular, there appears to be a distinct lack of ‘openness and transparency’ between administration and councillors. At last council meeting, our suspicions were verified.

In response to Cr. Penhalluriack’s question to Newton regarding the potential risk associated with the Glen Huntly mulch facility, Newton responded:

“The report that Cr Penhalluriack is referring to went to the Audit Committee at the Audit Committee’s request on the 24 February which is three weeks ago. All recommendations are being implemented. Had I been given notice of these questions I would have answered them tonight but I was not given any notice. I’ll have to take them on notice for later reply.” 

Now why on earth should the audit committee have to ‘request’ anything? If the organisation is at risk, then it is absolutely incumbent on Newton to table that information asap. This was obviously not done, and it appears that ‘action’ was initiated only as a consequence of Penhalluriack’s urging. 

This is not the first time that we have had to query exactly what information is disseminated to committees and councillors by the administration. There was the recent instance where Glen Eira faced over 40 criminal charges over the Clayton tip and a potential fine of millions. Nothing was published, and we suspect, that perhaps none, or very few councillors knew this was happening. Then there is also the MRC and Newton ‘negotiations’ where another ‘request for a report’ had to be turned into a formal Council resolution before any information was forthcoming. 

To make matters worse, the audit committee’s charter omits practically all reference to administration. Port Phillip on the other hand, makes it abundantly clear what it considers to be the role of administrators and their duty to keep committee members informed and cognisant of any potential risks. We quote:

“The Committee is to be kept informed by Council management regarding financial reporting, risk management and risk exposures of the organisation”.

Nothing like this appears in the Glen Eira charter, leaving councillors, committees and others, literally with their pants down! 

Newton must be accountable to council and he must explain:

1.    Why the report was not provided to the audit committee without being ‘requested’

2.    How long did it take for councillors to be made aware of the potential risk?

3.    Which delegated authority allows Officers to deal with such risk matters without reference to the Audit Committee and/or Council?

4.    Who are the Policy Officers who  administer risk matters of such nature?

6.    When will the charter be tightened up so that administrators are mandated to fulfil their obligations and cannot escape scrutiny because of poorly worded policies and documents? 

Forgive the levity of this post, but we thought we might have some fun with our legal eagle councillors and all of those working in compliance, corporate counsel, and so on. We could even be talking 50 well paid staff and councillors. So, how come they can’t get a simple thing like one sentence correct? 

We cite the opening sentence from Section 4.8.2 of the Councillor Code of Conduct which reads

“Councillors’ decisions are made in Statutory Council Meetings”. 

In the first place, councillors DO NOT MAKE DECISIONS – only Council does that! In the second place, the only decisions made at ‘statutory’ meetings are the election of the Mayor, and possibly membership/delegations on committees. Ordinary council meetings are not ‘statutory’ meetings – they are simply Council Meetings! but we guess the use of such language is imposing, impressive, obfuscating, and in the end just plain wrong! And we didn’t go to law school either.

The following letter, written to the auditors of the MRC is published with the permission from the author, Mr. Jack Campbell, MBE. We have bolded what we believe are significant sections and deleted the author’s address. At the time of this posting, no response to this letter has been received! We are also informed that a meeting between Council and the MRC occurred this afternoon.

14^th December 2010. 

Morton Watson and Young –  Chartered Accountants

51 Robinson St,

Dandenong 3175.

Dear Sirs,

 Re:    The Caulfield Racecourse Reserve Trustees. 

I write to you as auditors of the Caulfield Racecourse Reserve Trust drawing your attention to some apparent irregularities.   As you know the Trust has, since 1858, controlled Crown Land now worth well over $1 billion for the purpose of not only a racecourse but also a public recreation ground and a public park.  The Trust was criticised by The Legislative Council’s Select Committee on Public Land Development, which produced a final report in September 2008. One would presume the Trust would take cognisance of the report, which was chaired by David Davis, the Minister for Health and Ageing.

I now respectfully draw your attention to the following, and ask for your comment:  

1. The Grandstand (Head) Lease to the Melbourne Racing Club (MRC) expires in September 2012.  The final 3-year renewal, which could have proceeded (following due notice) in September 2009, has not been effected.  It follows that there is no lease, and a monthly tenancy of this Crown Land by the MRC is not legal and its occupation should cease.

2.  Notwithstanding point 1, the Grandstand (Head) Lease seems to only cover the Crown Land north of the racetrack, in which case the MRC has no right to sub-lease either the Western or the Neerim Road areas, or to use the ‘flat’ for training, car parking and other commercial ventures.

3. The sub-lease to Monash University has expired and the documentation is missing.

4. The sub-lease to Hore-Lacy of the ‘Western Stable’ complex is also missing and has probably expired.

5. A newly executed lease (23^rd April 2008) for the Neerim Road Stables is also missing, and it would appear that Freedman Brothers and Mitchell have already broken their lease by vacating the leasehold.   The remaining trainers are Mason and Aquanita Racing who, without the MRC having a legal head lease, may be occupying the Crown Land illegally.

6. The Deed of Maintenance and Development executed 17^th February 1997 seems to have fallen behind in its reporting and the MRC’s annual development plans seem to be routinely altered at the sole whim of the MRC.

7. State Government permission is sought and granted for buildings and works to proceed despite no current valid lease between the Trustees and the MRC.

8. An anachronism of the past is that the Trustees accounting period is calendar rather than financial, and the amount of rent, and when it is due from the MRC, is vague and indeterminate.  $180,000 p.a. seems to be the amount, giving a return of less than 0.02% on the real estate value.  What is clear, however, is no monies are returned to the community.

9. Without consulting the community the Trustees have indicated an intention to issue a further Grandstand Lease in September 2012, and have asked the MRC for a ‘wish list’ to ensure they get whatever their ‘heart’ desires.  (The previously negotiated ‘Communiqué’ between the MRC and Council is ineffective.  If the MRC is to retain control of this land fresh and sincere negotiations are essential to provide a direct and positive benefit to the community.) 

I am sure you are familiar with the Select Committee’s report, but for your ease of reference here are some of its recommendations: 

RECOMMENDATION 5.8

That the Government investigates:

• the history, membership structure, responsibilities and current arrangement of the Caulfield Racecourse Reserve Board of Trustees, particularly in relation to its duty to uphold not just horse racing, but all the purposes of the reserve in the original Grant;

• the purpose to which money raised by horse racing has been used;

and

• ways in which the Government can ensure that the Board of Trustees operates in an open and transparent manner and in accordance with the terms of the Grant.

RECOMMENDATION 5.9

That the Master Plan for the Caulfield Racecourse Reserve redevelopment be the subject of wide public consultation incorporating the municipalities of Glen Eira, Stonnington, and Port Phillip.

RECOMMENDATION 5.10

That the Minister for Planning strongly consider appointing community members and/or people with park and recreation expertise as nominees of the State Government to the Caulfield Racecourse Reserve Board of Trustees to provide a balanced representation of interests and expertise.

RECOMMENDATION 5.11

That the day-to-day management of the Caulfield Racecourse Reserve, by delegation from the Trustees to the Melbourne Racing Club, be reconsidered. 

At the hearing it became apparent that some Trustees did not even know the boundaries between the MRC’s freehold land and the Crown Land which they control and govern. 

On the 27^th November last year the Minister for Sustainability and the Environment, the Hon Gavin Jennings, told Parliament …  “that there might be some lingering concerns about the way in which this public reserve may be opened up to the community. In terms of my responsibilities as the Minister for Environment and Climate Change who deals with the land element, I wanted to be satisfied that the net benefit of this would derive a community benefit and that there would be the potential once and for all to make sure that the community is aware this is a public reserve and not, as it may have been perceived for decades, a private space.

“We are unswerving in our determination to ensure that there is a public benefit derived from this public reserve.”   (Hansard, my emphasis.)

Finally, fundamental breaching of the Crown Grant provides that the authorities may ‘re-enter upon the said land … and to hold possess and enjoy … as if this Grant had not been made’. 

Yours faithfully,

A. J. E. Campbell

At council meeting on Tuesday night, under ‘Councillor Questions’ Penhalluriack asked Newton a question related to the Glenhuntly mulch storage facility. In a long preamble to the actual question Penhalluriack outlined the following:

• Newton prides himself on correct ‘risk management’ procedures & policies.
• Scientific Consultants were called in to evaluate the public health risk at the Glen Huntly depot
• Part of their findings was that legionella ‘and fungi’ were presenting some risk to workers and the general public
• Several recommendations were made to reduce the risk – ie sprinklers, training, protective gloves/clothing, the importance of washing hands and signage alerting the public

The question asked of Newton had several parts:

• Why did Council ‘twice deny that there was any danger to the community’s health’ when he had twice asked about it
• Why did he have to go to the Audit committee and raise the question for a third time before anything was done?
• ‘why hasn’t (the report) been circulated to councillors?’
• Were areas ‘adjacent to the mulch bin’ also analysed such as the school, playground, car park areas?
• Penhalluriack also sought an explanation as to why it appears that none of the recommendations of the report have been carried out?

Newton took the question on Notice

COMMENTS:  Penhalluriack’s question makes it abundantly clear that information within this Council is ‘filtered’ and that only a select few are privy to information that could have major repercussions on the entire community and council’s liability. We remind readers of the composition of the audit committee (especially Lipshutz). If the audit committee did have this information, then why wasn’t it distributed to all councillors according to best practice and council’s audit committee charter? Why does it take a councillor 3 requests before any response is forthcoming? Why does it take months and months for any remediation of what might potentially be a public health risk? And the most important question: Why the cover up?

This comment was posted by Cr. Pilling. We repeat it as a post.

“I will certainly stand on my record as always voting wholely on the merit of a motion without fear or favor.

Three weeks ago I fully supported and voted for Cr Penhalluriack’s previous motion articulating Council’s vision for the increased public amentity and access at the Caulfield Racecourse as reported in this blog- I did so because I felt it was a sound and important motion that codified Council’s position.

Last nights motion again moved by Cr. Penhalluriack was concerned with how and where Council would negotiate with the MRC- Ultimately I felt it was a poor motion and not practical in providing a professional framework for negotiations to begin and succeed – This is the reason I voted against it and I totally reject the accusations directed at myself and other fellow Crs on this matter.”

Forgive this long post, but we believe it’s important!

Penhalluriack moved his motion under ‘Urgent Business’. It was seconded by Forge. Again a rousing speech which began by going over the history of the original grant and its 3 purposes – a racecourse, a recreation area, and a public park. ‘We don’t have a public recreation ground; nor do we have a public park’. It is important that we negotiate to ‘share this land….It is a huge land and many people here tonight have never been inside this land’. Last meeting proposed that we be given access to ‘all the land inside the training tracks’ – most of the land anyway is taken up with racing and training tracks. ‘For 150 years we have been kept out of it’. ‘It’s about time that we stood up and fought for our rights…..the Melbourne Racing Club has used that land for their own purposes…..we have 20 or 21 race meetings a year. That’s all!….but they have training every morning and every afternoon and that means that we can’t go on it….they are using land that is close to 2,000 million dollars…..2,000 million dollars for 20 bloody race meetings a year! Get real! It is our land……It’s time that we negotiate with the Melbourne Racing Club to take back this land…..The only fair and equitable way to do this is to invite the Melbourne Racing Club …to come to a meeting of all nine councillors and discuss it’.

Penhalluriack then stated that if he loses the motion and three councillors go off to negotiate that he ‘wouldn’t be happy when they come back and say this is the best we could get….because I won’t believe it is the best we can get and I’m sure Councillor Pilling will feel the same’. Lobo will also feel the same. ‘This is our land’. ‘we need to have access, unrestricted access to the land’….The trustees meet twice a year’, they haven’t done anything, councillors are 2 or 3 against 13 or 15.

Penhalluriack claimed that he comes from a business background and that it’s ‘common sense’ to him that ‘we should all be partaking of this exercise’….we need to get value for our money.

Forge then spoke stating that most of the community had ‘no idea’ that there were three purposes to the racecourse. School and sporting communities ‘are crying for space’ and ‘we’re looking at a sand belt in the middle and nothing for the public…..at the moment the horses are being treated much better than the public….not one of the 15 recommendations (from the public lands inquiry panel) has gone through…..what’s Glen Eira Council doing for us? We have put no ideas on paper….I think we have to be far more explicit….Cr. Penhalluriack and I have had more experience about this industry than anyone else (on council)….we have to look more closely at the makeup of people’ who will be representing us to the MRC.

Pilling then got up and commended the ‘passion’ of both Penhalluriack and Forge and the work they’d put in ‘but this motion is about the best way to negotiate with the MRC.’ Penhalluraick’s motion isn’t the best way to negotiate. ‘I won’t support the motion’.

Tang then asked whether it would be a meeting open to the public. Penhalluraick responded that no it wouldn’t be – just councillors.

Lipshutz continued the ‘theme’ by congratulating Forge and Penhalluraick for the work they’ve done and that ‘no one can suggest that they’re not passionate about this HOWEVER, this is not about passion. He objected to penhalluriacks remarks about the past. He was a member of council in 2005 and ‘took a very strong stance’ about opening up the park. The fact that they didn’t achieve this ‘was not because of lack of trying….because we had a government that wasn’t prepared to assist us…..this is about how to best achieve the result we want…..Penhalluriack said that he wouldn’t trust that (if 3 councillors came back with a proposal)….at all times this council delegates…..and when I vote for someone I trust them; I trust every member of this council. I believe every member of this council is reliable, is trustworthy….when I vote for someone to go off and represent council I trust them, so I reject what Cr. Penhalluriack says’. Claimed that how many racemeetings were irrelevant and that the real issue is ‘how best to negotiate’. No negotiation should ‘bring people in, have 9 people’ trying to negotiate. It ends up as a ‘free for all’. The example was a councillor saying that he wants fences removed and another councillor saying I don’t want that – I want something else. ‘so where do you go?’ You negotiate by good will, not by bringing in 9 councillors and having a free for all. Compared decision making to what happens at council – that is committees are set up to discuss issues. ‘I want as much as anyone here the racecourse to be opened up…..this (Penhalluriack’s motion) is a recipe for absolute disaster’. It basically says that this council ‘has no idea how to negotiate…we’re a professional council and we should do this properly….’

MAGEE said that the MRC will undoubtedly have their legal advisors, as council could, but that the meeting ‘should be held on council’s grounds….we can only put forward what we as councillors think is appropriate….anything that puts all the cards on the table and lets everyone know where we stand is a good meeting….

HYAMS then threw in his ‘dorothy dixer’ asking Tang to explain why, when every other time the racecourse had come up for discussion he had declared a conflict of interest, yet tonight he did not

TANG stated that his position as trustee put him in a difficult situation. He would ‘dearly love’ to be able to discuss these issues but ‘unfortunately they are a risk to council…..as a trustee I have responsibility to the Trust’. He is a ‘councillor nominee’ which enables him to ‘passionately advocate for the community’s interests’ by putting people’s ideas to the trustee meetings. He has ‘conflicting duties’ when ‘matters of policy affect matters of the Trust’ and since this discussion is not about changing policy he can comment(!!!!!!!) so since no questions affecting the trust are being considered now, there is no conflict of interest.

HYAMS then asked what happens if the MRC says ‘no’

Penhalluriack replied that ‘we are under pressure from this government and so are the MRC. I don’t believe they would stand up’ and say no.

HYAMS then asked about the composition and Penhalluraick responded ‘I don’t expect all councillors to show up….I would like to see all nine councillors come along and share the passion that Cr. Forge and I….we are democratically elected to represent our constituents…..if councillors want to turn up, if the MRC all want to turn up we can go and hire the pavilion….’

HYAMS then asked what would happen if the MRC wanted to go away and deliberate and how this would impact on council’s meeting schedule. He stated he ‘doesn’t disagree’ with the motion but the most important thing is that we act ‘reasonably’….in negotiation each side sends its representatives….they discuss…..they then go back to report to their constituent bodies…..and they see where they go from there…..I’m concerned (that we might be seen to be) ‘acting unreasonably’…the only question is how best to go about it…..we need to be reasonable’. Hyams also admires the passion and commitment of Forge and Penhalluriack, BUT ‘sometimes someone can get so close….you don’t know when to step back…..so close to something that you don’t trust anyone else to do it…..and when we reach a situation where that might be the best for everyone we don’t see that that might be the best for everyone…..it’s time to step back’. He doesn’t doubt Forge’s and Penhalluriack’s intentions, just the method of achieving what ‘we all want to achieve’.

TANG: ‘I resent what Cr. Penhalluriack has said…..(it is) self serving….Noone can doubt that they’ve been active in this issue…..I’ve dealt with Penhalluriack and Froge when they weren’t councillors….Council made very strong representation (and the Select Committee)….’we were all very interested…..it is annoying and frustrating when it becomes about personalities; who should negotiate….we’re now debating personality rather than policy….but I’m here to tell you that on policy everyone agrees…..’. Tang then claimed that it was the previous government’s fault and that the Liberals were no different now. ‘I agree we want the best possible negotiating team on behalf of the community….it is not about personality….we should be supporting each other in achieving that outcome….’

Penhalluriack summed up that the feeling is that we need to be ‘reasonable and my motion is not reasonable…..Last meeting we passed’ what everyone now seems to think was excellent points.’Prior to that meeting I had to negotiate, cajole, beg four councillors to vote with me….Those four councillors as it happens are all in their second term….and those four councillors….most vigorously oppose this….Well so be it. But I believe they will live to regret it. Those four councillors have achieved nothing by way of opening up (the racecourse)….absolutely nothing….This council has allowed the racecourse and the training areas to expand and expand….to the detriment of what we, the community wants…..and now we’re forced to negotiate with the MRC with one hand tied behind our back’. Lipshutz claimed that in 2005 they tried to open it up but the government wouldn’t assist – ‘well I’m sorry we’re also a local government….it’s up to us to negotiate to get this thing through. It’s our land…..’.

‘it’s not going to be a free for all….we are responsible citizens, councillors are all responsible citizens….this (council meeting) is the only area where council can make policy….this is supposed to be where these things are debated…..in public in an open and transparent manner….I think councillor Tang should perhaps consider resigning his position…and appointing someone else who doesn’t feel that moral obligation…of not being able to report to us….the whole purpose of having a councillor as trustee is that so we know in an open transparent manner what is happening…..’

Esakoff put the motion to the vote. IT WAS LOST.

PENHALLURIACK CALLED FOR A DIVISION.

PENHALLURIACK, FORGE, MAGEE, LOBO VOTED FOR

LIPSHUTZ, TANG, HYAMS, PILLING AND ESAKOFF AGAINST.

Lipshutz then moved a motion that Newton, Eskakoff represent council in negotiations with the MRC. Motion was passed. Only Forge and Penhalluriack voted against.

CORRECTION: The Lipshutz motion also included himself and Magee as the councillors to ‘negotiate’ with the MRC.

It is important that we first establish the credentials of the extract we are about to cite. It comes from Page 19 of a document entitled “Best Practice Guidelines Local Government Entity Audit Committees & Internal Audit” (June 2000). These guidelines were prepared by “the Auditing & Assurance Standards Board of the Australian Accounting Research Foundation, with the support of The Institute of Internal Auditors – Australia and the Australian Institute of Company Directors for the Department of Infrastructure (DoI) and endorsed by the Municipal Association of Victoria (MAV) and Local Government Professionals (LGPro).” 

The extract which primarily concerns us, is: 

“Appointments of external persons shall be made by Council by way of a public advertisement and be for a maximum term of three years. The terms of the appointment should be arranged to ensure an orderly rotation and continuity of membership despite changes to Council’s elected representatives.” (page 19) 

Of the 8 authors listed one name stands out – MR. DAVID GIBBS – the Chair of Glen Eira’s Audit Committee!

What we have here is a highly respected ‘authority’ producing guidelines for local government, yet NOT ADHERING TO HIS OWN GUIDELINES. Mr Gibbs and Mr. MacLean have both been with Glen Eira since at least 1998. Both their names are continually mentioned in the 2005 Whelan Report, as well as in the 1998 Walsh Report.  That means that for at least the past 13 years the external members of the Glen Eira audit committee have NOT CHANGED.

The ratepayers of Glen Eira need and demand answers to the following questions:

1. Why have both Gibbs and McLean been given such lengthy and uninterrupted tenure on Council’s Audit Committee?
2. Why has Mr. Gibbs failed to adhere to his own guidelines and not resigned from the Council Audit Committee?
3. Why is Mr. Gibbs said to be consulting with Andrew Newton on a ‘staffing’ matter as outlined in the Whelan Report, when officer staffing is the exclusive domain of the administration?
4. How does Council respond to the growing perception, and hence alarm, within the community that all is, and has not been, 100% “kosher” with its Audit Committee?

In late January this year, the Minister for Local Government, Jeanette Powell, gazetted a comprehensive 42 page blueprint for Audit Committee reform and accountability. Whilst only ‘guidelines’ the Minister also stated  that Local Governments are “strongly encouraged to adopt and use the Guide when establishing their audit committees”.  Much of what the 42 page document entails has a direct bearing on the Audit Committee as constituted in Glen Eira. It is timely to consider this issue now since the agenda items listed for discussion next Tuesday night clearly fly in the face of the Minister’s recommendations in several key areas.  

We discuss the central issues under several headings – 

1. Composition and tenure of Audit Committee Membership 

The recommendation from the Minister is: 

“Periodic rotation of the members of the audit committee is encouraged as this will enhance the perception and reality of audit committee independence… To ensure continuity, ideally no more than one member should leave the audit committee pursuant to rotation in any one year. …..LGE members will be subject to council elections every four years and accordingly the tenure of LGE members on the audit committee needs to be set to allow for their rotation among the nominated LGE members….The period of tenure for independent members could be two to three years, again with options for reappointment after periodic performance reviews. The LGE might also consider setting a maximum number of terms of reappointment for independent members.” 

COMMENT: The latest agenda items contain committee nominations for 2010/11. Lipshutz and Tang again feature prominently. In fact, their tenure on the Audit Committee, as well as other important committees within Glen Eira (such as Local Laws; Racecourse Issues and previously Finance) has been extraordinary. The table below illustrates clearly how this council and its councillors have allowed two individuals to dominate the most important committees and which we argue is now in complete opposition to the position expressed by the Minister. 

 2.     Further Recommendations from the Minister

Some more extracts from the guidelines –

“To be effective, the audit committee must be independent from management and free from any undue influence”. 

COMMENT: In Glen Eira the ‘Finance Committee’ has suddenly become defunct –  no meetings of this committee were recorded in the Annual Report for the previous two years and it has now vanished from the upcoming committee delegations. Yet the table above reveals that Lipshutz was a member of this committee whilst he was also on the Audit Committee! A great example of ‘independence’ and perhaps ‘conflict of interest’ we ask? 

“Review internal audit’s mission, charter, and resources such that this charter maintains internal audit’s independence from management. This is achieved through its reporting structures and rights of access to all levels of management and relevant information…..Ensure that all work is reported through to the audit committee and is not censored or held up by management”. 

COMMENT: Not only Lipshutz but Gibbs and McLean have also been sitting on the audit committee for eons and have been extremely well reimbursed for their time and effort. We ask again why the Minister’s guidelines recommending rotation should not apply in the case of the latter two members? As the Minister states,  it is important to ‘also to provide a fresh perspective through succession planning and the selection process.” 

Finally, there are many comments throughout the document related to ethics, governance, and of particular emphases is the development of a charter that clearly enunciates all mechanisms, roles, expectations, and evaluations of the committee itself, and its individual members. The facts that readers should keep in mind are: 

1. These guidelines were published on January 31^st 2011 and gazetted on 8^th February 2011
2. Council has thus had ample time to read, absorb, and plan for their implementation. This has not been done!
3. Instead, we have basically the same old members; the same old accounting firms; the same old protocols, and hence the same old questions about independence, good governance and perceptions of all too cosy relationships with external and internal members 
4. Are Lipshutz and Tang in particular, so extraordinary in their skills, acumen, and vast accounting and/or expansive legal experience that they are indispensible on all these major committees? And is it mere coincidence, or the councillors’ own wishes, that Penhalluriack and Forge only manage to get on three committees, and Oscar Lobo is only on one? Should ratepayers conclude that no other councillor can fill the shoes of Lipshutz and Tang – that these individuals have the time to do a job properly when they are sitting on 6 committees each?  Or is there another agenda being played out here which has been ongoing for years?

Agenda for Glen Eira Council Meeting, 15^th March 2011. 

10.      Urgent Business 

Seek leave to raise an item of urgent business. 

Involves a request by the Minister for Planning to negotiate with the Melbourne Racing Club to ensure a public benefit from the Crown Land known as the Caulfield Racecourse Reserve.   There is no other motion from Council to permit these negotiations to proceed.  We are dealing with 56 hectares of land worth over $2 billion. 

Motion:  (Moved by Cr. Penhalluriack; seconded by Cr. Pilling.) 

That Council invites authorized representatives of the Melbourne Racing Club to a meeting with Councillors to discuss future arrangements, including timetables, for the sharing of the Caulfield Racecourse Reserve Crown Land.  The Mayor shall open the meeting, and introduce Councillors Forge and Magee who shall explain, using overheads, Council’s position.  The meeting shall then be open for all to contribute.  The meeting shall be sound-recorded and minutes shall be prepared.