Tonight’s council meeting exemplified in spades why change is desperately needed in Glen Eira. The most persuasive argument for change comes from the ludicrous statements and arguments put up by Lipshutz, Hyams and Tang. This was most evident in his comments on Penhalluriack’s Request for a Report and in the ‘debate’ on the financial report. We will concentrate on the latter for this post.
LIPSHUTZ: started off by saying that the financial report is ‘appropriate’ and again shows how well council is going. On GESAC there were some ‘ill informed’ people who by claiming that council had to hand over $3 million ‘should have known’ that this is all part of the adjudication process and that council was still ‘confident’ that it would be ‘successful’ in getting its liquidated damages – but this would take time. Went on to speak about the superannuation fund stating that the ‘shortfall’ can be ‘paid off over 15 years’. On council debt he said that there ‘are some who say it is disturbing – I’m not sure why’ since treasury has given a ‘clear marker on how to manage it’. Council has also been ‘commended’ on ‘how we’ve handled our financies’ ….’cash balances are healthy’. Swabey and team should be ‘commended’.
COMMENT: Amazing how a current debt of over $23 million dollars – one of the highest in the state – is not ‘disturbing’!!!!!
TANG: echoed the 3 issues and said that ‘we’ve tracking ahead of schedule’ in terms of surplus but this doesn’t mean ‘we can do any more in terms of capital works’ Council’s approach is to ‘accelerate capital works’ when there’s a greater than expected surplus. ‘I know there’s a bit of argey-bargey’ as to whether debt repayments should be accelerated or capital works. Spoke about the next council starting on one more pavilion if the surplus continues. Said that GESAC is going better than forecast in that they thought that residents would be paying ‘interest and borrowings’ off rates but the money is coming in from ‘door takings’. Magee had mentioned earlier that he expected usage to be ‘dropping’ , but Tang corrected him by calling it ‘usage stabilising’. So if it stays at 7000 members then it will be ‘less of a call on ratepayers’.
COMMENT: have we missed something here? If door takings are covering costs, then how can there still be a ‘call on ratepayers’?
PENHALLURIACK: Started off by saying that debt on GESAC is ‘a long term debt’. Said that the interest rate is 8.06% and council is stuck paying this rate when over the past year interest rates have dropped dramatically – yet Glen Eira is still paying this for the next 15 years. ‘The cost in this first financial year is almost $3 million’. This will be a ‘burden’ on ratepayers ‘which we can’t do anything at all about’. As a result ‘we need to take a fresh look at where we can save money’. Like any business, if ‘we spend more than our income we’re going to go broke’….’I look at council as a business and as a business I think we can do better’. Claimed that he was confident that rates could be ‘kept to a zero increase’ . Said that council needed to look at its overall expenditure and ask ‘is this good value’ for money? ‘Have we got a cost benefit?’
PILLING: Said he disagreed with Penhalluriack because council wasn’t ‘just a business’ but also services and facilities. Said they could approach it as a business but run it for the community.
PENHALLURIACK: wanted to answer this.
HYAMS: ‘are you saying that your comments were taken out of context or misinterpreted?’
PENHALLURIACK: yes. Hyams then permitted the comments where Penhalluriack said ‘business for the social benefit of the community’.
HYAMS: said he wanted to make a ‘few comments’ about Penhalluriack’s comments. Claimed that cost for council go up around 4% per year because of material costs. Glen Eira also has an ‘infrastructure gap that we need to keep on spending to close that gap’ because if we don’t it will end up costing more. So, ‘bearing in mind that we have the third lowest rates in Melbourne’ Hyams said ‘that our policies are actually very sound and responsible’ and that to say there can be a zero rate increase ‘would be completely irresponsible…..result in far fewer services’. Gave example of deferring Murrumbeena park development. Currently this is costing $750,000 but if put back it would then cost $1 million because there wouldn’t be the government grant. Said that the call for zero rate increase was a ‘nice election gimick’ and Hyams would ‘like to think that our public isn’t likely to fall for that one’. Rephrased and said that the public would realise that this wouldn’t result in ‘council providing goods and services…that it should’.’
FORGE: ‘took exception’ to the statement that zero rates is an ‘election gimick’. Said that there were plenty of things that council can spend ‘less money on’ and gave example of the concrete plinthing in Caulfield park where as Camden councillors they didn’t want this, but rest of councillors voted for it. Went on to say that some works ‘needn’t be large but they all add up’ . Glen Eira might be one of the ‘best performing councils’…’but there’s no reason why we can’t do better’.
TANG: Said that he wasn’t standing for election, but he’d like to ask the question of Penhalluriack that if he were campaigning on a zero percent rate rise that like the Republicans did in the US, ‘surely you would put together an alternate budget’? Asked Forge and Penhalluriack ‘Have you put together an alternate budget that goes through…how you would’ achieve a zero rate increase….rather than making motherhood statements?
PENHALLURIACK: Said that he was the ‘only councillor’ who presented a right of reply to the budget. Said that he had ‘set out a number of areas and they certainly weren’t motherhood statements…..achieve a zero rate increase’. Most important was ‘that we don’t employ any new staff’. Said that there are many good staff. They’re getting 3.7% increase and rest of community is getting about 2% wage increase. Said that state and federal governments are laying off staff. Said that the figures he produced showed ‘clearly’ that it was ‘quite easy’ to save many millions of dollars by ‘not increasing the staff allocation’. Also claimed that it wasn’t true that we need more staff to run GESAC. ‘we’ve already taken on a lot of staff to run gesac’ and don’t need to increase like ‘we’ve been doing for the last 3 years by some 30%….it’s scandalous, it’s not necessary….it should not be done and if we were running a genuine business we would be out of work….’
FORGE: said that it was ‘far too early’ to be that specific and that it can be looked at over the next 4 to 6 months and see ‘where we can delay things’ ….we know there are many ways we can reduce spending and delay spending’.
PENHALLURIACK : withdrew his use of the word ‘scandalous’
LIPSHUTZ: ‘we are one of the lowest councils’ for rates. Said that saving money and having a zero rate increase by not having staff ‘begs the question’ since COUNCIL DOES NOT EMPLOY STAFF ‘WE ONLY EMPLOY ONE PERSON, THE CEO’. Said it was ‘beyond our capacity as councillors to determine what staff should be employed’. Admitted there had been a ‘significant staff increase’ but that was due to GESAC and it is necessary because of the ‘issue of safety’. Said that council has been ‘commended’ on how it manages risk. Also have ‘one of the lowest expenditure on assessment ratios’. Went on to say that at budget time ‘every councillor comes along with their pet projects’…..’we as council prioritise those issues’. Said that people like Forge and Penhalluriack can talk about rate cuts but with the 4% increase anyway this will mean cuts in ‘services’. Agreed that council should be run in a ‘business like way’ and it is because of external and internal auditors so it is ‘being run like a business’…’what we have been doing is remedying the infrastructure gap’. Said that he and others when they came on council were told of this gap and that this is a city where ‘drains are over 100 years old (so the report) demonstrates that council is on the right track’.
MOTION PUT AND CARRIED UNANIMOUSLY.
COMMENT: Lipshutz’s claim that it is ‘beyond our capacity to determine what staff should be employed’ is not only laughable, but symptomatic of the cow towing culture and legal mumbo jumbo that so befuddles most of these individuals. Councillors do not only appoint the CEO – they also set policy, strategic direction and yes, even budgets via a formal vote that becomes a council resolution and makes it incumbent on the CEO to carry out those resolutions in a ‘timely’ fashion. The CEO is the SERVANT of councillors. He has the right to appoint staff but only within the parameters set by councillors. For example:Council has the power to pass any resolution it likes, including one which says ‘no funding will be made available for new staff for the next two years’. How the CEO then decides to deploy the existing staff to cover services is up to him.
It’s also quite fascinating that Lipshutz mentions 100 year old drains and the ‘infrastructure gap’. We’ve already put up posts which clearly show that spending on drains has in fact not kept up with inflation and this is after the disastrous floods of last year. Other infrastructure is obviously more important to Newton and the gang!
A comment also needs to be made on Tang’s attempted mischief. Councillors do NOT prepare budgets. That is the role of officers. Councillors role is to analyse, dissect, question, and make decisions on the proposals put before them and make some proposals themselves and receive comprehensive advice and accurate figures. To therefore ask Penhalluriack and Forge whether they have prepared an alternate budget is like asking Obama (since he’s used the American analogy) whether he has written every word of his election speech. The nuts and bolts belong to the underlings – in this case the speech writers and in Glen Eira’s case the officers. BUT it is for councillors to make the final decisions on whether or not to accept, adopt, amend, question, refute, suggest, and pass the relevant documents and budgets. In Glen Eira critical analyses by councillors is, we believe, non-existent on most occasions. Everything is ceded to those who were not elected by residents yet who evidently control every facet of what happens in this council. This can only happen because of the willing or unwilling compliance of 5 councillors. That’s why it’s definitely time for a change! We are firmly of the opinion that residents clearly want councillors who will work with and for the community and not for unelected bureaucrats that are not directly accountable to those who pay their very, very handsome wages.
Glen Eira Debates 
September 25, 2012 at 7:50 AM
For Lipshutz to claim “we only employ one person – the CEO” shows just how totally out of step he is with residents and that there is a huge cultural issue in Glen Eira when Councilors and Administration think this way.
The ratepayers pay the staff salaries ergo the staff work for the ratepayers, undertaking the daily administrative tasks in accordance with ratepayers expectations. The administration reports to Council (i.e. the elected representatives of the ratepayers) and Council is responsible for defining the rules underwhich the daily administrative tasks are under taken. This is very basic stuff and usually is within the first paragraph of any document covering the role of Local Government.
Lipshutz’s comment clearly shows that he has forgotten this and is under the impression that the Administration reports to Newton and that Newton and only Newton have a say in the running of the Admin. I don’t know one resident who would support this view and am fully aware of the growing dissatisfaction among residents because this Councíl consistently fails to represent the residents.
Lipshutz has been on Council way too long – that he is openly espousing this line shows that he has totally lost the plot and is supporting the Admin rather than residents.
The man needs to be shown the door.
September 25, 2012 at 10:09 AM
Hyams talk about an election gimik is pretty rich from someone who claims “achievements” like gesac and much more on his election flyer. He sounds like a broken record with his lowest rates in Melbourne. Tell that to residents who keep paying hundreds of dollars more each year.
September 25, 2012 at 11:00 AM
VCAT is fast approaching Glen Eira. I have heard Council intends calling you and the STOOGE (who nearly allowed the Town Hall to be demolished) as wittnesses, and if I were you, I would indeed be nervous.As for the rest they are hopeless and obviously inarticulate.
September 25, 2012 at 11:45 AM
There’s no question that much of what happens in all municipalities constitutes a large percentage of waste and unnecessary works. That’s the nature of the public sector. The extent of this waste in Glen Eira though, and in the face of a huge debt burden, is a fair issue for consideration.
Council took on owning and running Gesac. That has meant the employment of more staff. My qualms go back to the basics by questioning whether council has the expertise and the necessary experience for such a major project. I’m also unsure why they simply had to pay for all the outfittings themselves rather than allowing the tenants to supply their own staff and do the outfitting as is the case with most commerical leases. There obviously hasn’t been sufficient planning as the car park chaos illustrates. The excuse that Gesac is doing so well won’t hold since the original forecasts were for over 500,000 visits per year. Council therefore knew the what was in store from the start. The inability to plan thoroughly enough is thus obvious. And this is just one instance that comes to mind.
I’m sure that as Forge said, there are many savings that could be made. Half a million here and there does add up in the final accounting. Whether or not 5 million is saved, or ten, it is worth pursuing. I don’t see how not installing concrete plinthing in Caulfield Park will affect “services” or amenities of residents. The same could probably be said for countless other projects. Residents do have the right to know that every penny they pay in rates is being spent wisely and appropriately. Whether this translates into a zero rate increase for residents should not be ridiculed out of hand. It is worth investigating fully.
September 25, 2012 at 12:02 PM
I strongly believe that if a truly independent assessment (perhaps by Local Government VIc or the Auditor General) of value for money & cost effectiveness of GE Council were conducted- it would be given a low, low score!
GE Council employs over 600 staff – what do they all do?
I bet (based on my professional training and monitoring the goings on in the Council for a long time) that the assessment would show serious inefficiencies, poorly skilled staff, poor measurement of performance in all key delivery areas- ranging from infrastructure, community services, planning), a dire lack of community input in Council decisions, poor financial management and poor commercial expertise, and of course demonstrated time and time again, lack of transparency and accountability to the residents and ratepayers.
Councils are a business, sure I admit, for the social benefit of the community, but still they need to be run along the lines of a business nevertheless- otherwise like any poor business, councils can go ‘bankrupt” and that means the ratepayers take on the big DEBT, resulting in heavily increased rates or special levies, while services to the community halt or worse even, disappear.
Do we want this – as a concerned ratepayer (with raetes going up several hundred dollars each year for the last 5 years) I dont thnk so…
Time to go Hyams, Lipshutz, Tang, Esakoff…
September 25, 2012 at 12:13 PM
A minor correction to your figures Elsternwick – Glen Eira has over 1000 employees and for the next financial year the equivalent of 736 full time staff. Please note: this does NOT INCLUDE ‘contractors’ who are employed for year after year. We have no idea of how many individuals this applies to. Further, Glen Eira City Council, has 5 Directors sitting on over $230,000 pa, according to last year’s Annual Report. Undoubtedly, this figure will now have risen. Again, we don’t know whether this includes other lurks and perks such as bonuses, cars, etc. Benchmark councils, who have greater populations and greater areas do not have such a ‘top-heavy’ bureaucracy earning this amount of money.