The black hole of GESAC is clearly getting bigger and bigger – despite all the assurances from Lipshutz and the other financial whiz kids on council. After enduring a quite nauseating performance by Lipshutz on the audit committee minutes and how much the Auditor General had praised council for its performance and how it is an example to other councils, some of the truth finally emerged about the Hansen and Yuncken call for their money through another report by the auditor general which highlighted the call for ‘adjudication’ by Hansen & Yuncken.
The past few financial reports have consistently stated that Council is withholding over $4 million dollars as part of the ‘liquidated damages’. The building contract was $41.2 million and up til last month council had only handed over approximately $37 million. We now learn that the adjudication has in fact forced council to cough up $3 million of the money it was holding back. But, there’s much, much more to this as we report below.
LIPSHUTZ: on the Audit Committee minutes – ‘we were praised for the transparent way we went about GESAC’….(Auditor General gave council) ‘profusive praise’ in how ‘we managed our finances’…’I was particularly chuffed and enthused’ as he said ‘we were an example to other councils’. …’leader in the field’…..
PILLING: reported on community grants and claimed that over $300,000 was given out (OUR COMMENT: note that this amount also includes government grants!!!!!)
PENHALLURIACK: said that he went to the Audit Committee meeting and that the Auditor General did praise Glen Eira but ‘it was in a non specific way’. Referred to a ‘report that the Auditor General has commissioned’ about GESAC and that there’s ‘an adjudication of almost $5 million dollars to be heard against Council…and that was in a separate report to the meeting’.
MAGEE: said he attended the meeting. Stated that council oversees a budget of over $100 million and over 130,000 residents. Council ‘very adequately allocates those funds’. Went on to explain about the external auditors and kept reassuring residents that the finances are being well handled. Stated that those in the gallery should be ‘well assured’ that the rates are ‘being well administered, well spent’. If money was being wasted then auditors would pick that up and ‘that’s not the case’.
HYAMS: asked Penhalluriack whether he said that ‘the Auditor General commissioned a report into GESAC’?
PENHALLURIACK: ‘not into GESAC. He commissioned his own report’.
HYAMS: asked Newton whether the Auditor General ‘commissioned a report as described by Cr Penhalluriack’?
NEWTON: ‘Not into GESAC, no’.
LIPSHUTZ: said he was present and ‘did not hear anything of that nature’. Said that council’s got the money in the bank and that it then becomes ‘an issue between the builder and ourselves’. Claimed that none of this ‘comes as a surprise’ that it was ‘expected’. Went on again about the Auditor General and how council had a good ‘business plan’.
Towards the end of the meeting Hyams requested a report on the state of the basketball allocations at GESAC. Said that since GESAC opened in mid season that by the next meeting this situation should be ‘resolved’ and that the courts should be ‘in full operation’. Pilling seconded. Motion passed unanimously.
There was then one Public Question that asked ‘what proportion’ (of court time allocated to the Warriors from Friday to Sunday are actually) ‘being utilised’? Also wanted to know how interested parties would be advised about next years’ allocations since the Warrior one was for only 12 months.
The response was a wonderful sales job on what GESAC caters for; problems with builders, etc. Claimed that next season would see full use and that the warriors use of the courts was currently 57.5 hours instead of 80+ hours.
PENHALLURICK: SAID THAT ‘WE DIDN’T GET EARLY NOTICE OF THESE QUESTIONS AND ANSWERS’ and that he would like to say something in ‘response to some of them’. Asked if the 57.5 hours ‘is being paid for’?
HYAMS: mumbled and fumbled his way through in response saying that the Local Law lets councillors put in individual responses but doesn’t allow ‘supplementary questions’ from councillors.
PENHALLURIACK: said that he would have provided his own answer ‘if I had notice of the question’. Went on to say that he was asking a question about the answer given.
HYAMS: ‘The Local Law doesn’t allow that’. Said that it could be a question on notice for next meeting.
PENHALLURIACK: claimed it was a silly local law. Hyams came back with you ‘probably voted for it’. Penhalluriack agreed.
Next public question asked about the liquidated damages and why council was withholding 10% of the money it owes to the builder. Hyams then read out the answer quoting the financial report which says that council has paid 36.99 million. Contractor had gone to adjudication for 4.2 million and that ‘it has been completed’. Said that council has now paid 39.99 million. Went on to say that the contract allows for these matters in dispute to be settled and that there are processes which could end up with council receiving money or facing ‘additional payments’….these processes are underway’.
COMMENT: These exchanges certainly make a mockery of Lipshutz’s claim that council has been ‘transparent’ in its dealings over GESAC. Further, we wonder if:
- Glen Eira Debates hadn’t publicised the Hansen & Yuncken adjudication whether anything at all would have been stated
- If Glen Eira Debates hadn’t publicised the issue would the public question have been asked and some form of answer supplied.
- As far as the answer goes we still have major concerns. The door is still open for further penalties paid by council. Will Hansen and Yuncken claim interest on their money owed? Will they claim legal expenses? Will they sue for more money as Hyams indicated is a real possibility? Penhalluriack spoke about $5 million we remind readers.
- What has this handover of $3 million done to the budget/cash flow especially when there’s another 3.1 million due for super top ups?
- Have the Warriors actually paid a cent to council or have they been granted free access? What impact has this had on proposed income at GESAC?
There are countless questions that require straight forward answers. No spin, no obfuscation, and no porkies, and certainly no deft sleight of hand as evidenced by Lipshutz’s claim that he does not remember the Auditor General’s commissioned report being ‘discussed’ at the Audit Committee. We point out that perhaps this wasn’t DISCUSSED but presented in a pile of papers and reports that few councillors actually bothered to read?!!!!! We suspect that this is standard practice for this administration!
Finally we can only highlight again the tactics of withholding public questions until too late to respond and the recourse to gagging tactics via the lame excuse that the local law does not carry a provision for councillors to ask questions when they like! So much for open, transparent and accountable governance! Lawyers must be jumping up and down and rubbing their hands with glee over the prospect of unending work!
Glen Eira Debates 
September 5, 2012 at 5:25 PM
The courts are empty for just on one day. Monies are probably not being paid. Lawyers are making a killing. There’s the prospect of more sums handed over to Hansen and Yuncken. More legal costs. More money down the drain. More unhappy customers living near gesac. More car parks. And we’re still told how wonderful this lot is! Alice in Wonderland couldn’t have come up with a better fable. This is what happens when huge heads bureaucrats decide that they’re capable of running a multi-million dollar project and leave it in the hands of such people as Lipshutz and Burke and Newton. The writing was on the wall from the beginning. Now all the little truths are starting to come out.
September 5, 2012 at 5:50 PM
Be mindful that GESAC opened only 2 weeks after the start of the winter basketball season. For 10 months prior the successful bidder tried to get a competition going, even saying that alternate courtspace would be utilised until GESAC opened. Warriors couldn’t get a competition going when they were at Oakleigh and will struggle to get a significant competition here at Bentleigh East, though I commend their endeavour. With McKinnon Basketball, Glen Eira already has an established basketball competition catering for all ages and abilities, it’s just that some people don’t like being that organised. The ideal would be if Warriors continue their tenancy and develop their programs while giving over some of the unused court time to McKinnon, a win for both groups.
September 5, 2012 at 6:32 PM
Check out council advertising. They’re even now spruiking for members and doing the warriors dirty work.
September 6, 2012 at 12:23 PM
The convenience of blissful ignorance! Warriors are going gangbusters!
Growth of 500% new junior boys, girls and open age competitions forming and a new regional competition forming and a new game format that players are loving.
Yes, courts have been empty on mid-Sundays recently as that is allocated for Warriors rep teams training and that has been clashing with junior football finals with teams moving to mid-week and later Sunday sessions to avoid any clashes.
Those rep teams (as I am sure Brendan would well know) are also coming to the end of their seasons and many are taking the chance to enjoy the few weeks they have off between seasons.
The Warriors are in great shape for the Summer season and are totally organised. The ideal would be if people in management at McKinnon stopped belly aching, stopped taking pathetic pot shots at the Warriors and council and joined in the regional format the Warriors are working on which would give ALL kids in this area a chance to play at all venues against all clubs in the area.
That would be a first working for the kids in the sport instead of kicking them out of it, as the MBA did with my son three years ago!
However that would go against the closed shop currently in place at McKinnon where only 21 people get a vote at any AGM or SGM these days.
If they opened the MBA up to a wider competition then potentially the wider membership at McKinnon might see there are two sides to every story as opposed to the propoganda they and others have been feed for the past three years with many home truths to be exposed that they don’t wish to be exposed
PS. At the Warriors all our members are entitled to vote at our AGM’s and SGM and any meeting for that matter. We appreciate our membership and their contribution and take that contribution seriously. They may have a a larger membership at the MBA (for now) but they still only represent 21 people.
September 6, 2012 at 3:21 PM
How about telling us how many Warrior members live in Glen Eira and whether the Warriors have handed over any money for their allocation or have you got it all gratis, courtesy of Glen Eira ratepayers and Paul Burke’s lousy decision making?
September 7, 2012 at 3:14 PM
There you go, right on queue, some more propoganda being placed on this forum.
Two blantantly misleading perceptions have been bandied around about the Warriors. One is that they are not a Glen Eira club when they were actually founded in Glen Eira and in fact were one of the two founding clubs of the MBA.
The vast majority of our members are Glen Eira ratepayers, as like any club we have members from neigbouring cities as does every Association including the MBA with clubs such as Brighton Wolves, St Finbars Scalpers, Moorabbin Magic and even the “OAKLIEGH RAPTORS all drawing members from outside Glen Eira city boundaries. For the record good on them for doing so as well, as its about giving kids something constructive to do, not their postcode demographic which despite all the banter both the Warriors and the MBA have and are acheiving..
The Warriors have paid their way at all venues they use and they continue to do so at GESAC, which goes against the inuendo spread by many with links to MBA that they would fall over after just a few months at GESAC. In fact quite the opposite they are going from strength to strength.
I look forward to any more misleading accusations being placed here for rebuttal.
September 5, 2012 at 6:40 PM
Could someone please explain to me how Lipshutz can keep on saying that Gesac is making a surplus and running at a profit? The figures just don’t add up. Even if there are 6000 members and for the sake of argument let’s say that this brought in 6 million, there’s still wages for 50 staff, interest of over 2 million each year, plus over 7 million that they’ve admitted to for outfitting the place. Then there’s got to be regular cleaning and maintenance and electricity and heating bills. They also admitted to over 2 million in revenue that didn’t come in. The books don’t balance is my point unless of course all these expenses are put under different listings so that we never get the true picture of what’s going on. And I forgot to add another million for the extra carpark and moving the playground. It’s cost heaps and heaps and will go on this way for another 15 years. When the gloss has gone and attendance starts dropping that’s when the sh*t will really hit the fan and no amount of cover up will hide this.
September 5, 2012 at 11:00 PM
Anon, give them some credit, think of the money they saved by not placing notices in the media re the delayed opening – 5 months of not telling anybody anything gotta be worth at least a saving of $10,000.
September 5, 2012 at 7:42 PM
I am quite amazed that Gibbs and McLean are still members of the Glen Eira Audit Committee. They have both been the sole independent members for so long that they could no longer be considered to be independent under any definition. Pity the Auditor General could not make a comment or perhaps he did but the minutes have once again been manipulated to not reflect this fact. As for Lipshutz, has there ever been a more incompetent Councillor in the history of Caulfield/Glen Eira. He presided over not only the C60 cave in to the MRC for nothing but also the GESAC debacle.
September 6, 2012 at 7:42 AM
To have the same auditors for such a long period is a serious breach of governance by any measure. They would be considered part of the furniture. I am surprised that the AG has not commented on their extended tenure.