GE Governance


From the VAGO website:

Business Planning for Major Capital Works and Recurrent Services in Local Government

 

Under Section 136 of the Local Government Act 1989 (the Act), all councils are required to implement principles of sound financial management; including managing financial risks prudently having regard to economic circumstances; ensuring that decisions and actions have regard to financial effects on future generations; and to ensuring full, accurate and timely disclosure of financial information relating to the council.

The 2006 Inter-governmental Agreement Establishing Principles Guiding Inter-Governmental Relations on Local Government Matters further commits councils to demonstrating sound public governance through good fiscal management; to consider available resources and competing priorities when making service-delivery decisions; and to improve their strategic planning and development of appropriate pricing regimes.

It has been six years since the Act was amended to shift away from annual planning to longer-term four year Council Plans and Strategic Resource Plans. It is timely therefore to determine whether this has strengthened business planning and budgeting.

The audit will review the business planning and budgeting practices for selected capital works and recurrent services in a sample of metropolitan and non-metropolitan councils.

The report is expected to be tabled by end of September 2011.

From The Leader, Jenny Ling – Page 3

COUNCILLOR PROBE IS CONFIRMED

The Local Government Investigations and Compliance Inspectorate has confirmed it is investigating “a matter related to councillor (Frank) Penhalluriak”.

The Camden Ward councillor riased health concerns about Glen Eira Council’s free mulch service and the possible risk of residents contracting legionnaires’ disease, which led to the removal of the service in April (“Mulch to fume about” Leader April 26).

Councillors voted 7-2 in favour of removing the service at Glen Huntly reserve, leaving the $160,000 mulch storage shed – built in 2009 – empty.

In May the inspectorate said it was reviewing conflict of interest allegations made against Cr Penhalluriak who owns a hardware store in Caulfield that sells mulch. “Upon receiving a complaint, the inspectorate reviews the information…in order to determine if it is within jurisdiction and contains suitable evidence to investigate,” spokeswoman Angela Smith said at the time.

Ms Smith confirmed last week the inspectorate was now investigating, but would not make further comment. “Each investigation is unique and it is therefore not appropriate to anticipate a specific time frame for the resolution of any case,” Ms Smith said.

Cr Penhalluriak said he was not aware of the investigation. “If I did it would be confidential so I can’t make any comment,” he said.

At last council meeting there was the (eventual) tabling of questions previously taken on notice. The time lag was 2 months! More significantly, two questions concerned the costs to ratepayers over legal proceedings and the machinations over the reappointment of Newton.

We report that the first question printed below was declared ‘inadmissable’ under Local Law 232 and the provisions of the Local Government Act –   it was regarded as ‘confidential information’. Part 3 of another question received similar treatment. The rest of the question was taken on notice. In the public interest, since this information will not appear in the minutes, we publish in full both questions.

The ‘inappropriate’ question was:

“What is the current cost to council for:

1.    Ms O’Neill in her brief to investigate allegations of bullying/harassment against Cr. Penhalluriack?

2.   Have other lawyers also been engaged by council in this matter? If so, what is the total cost of their engagement to date?”

The second question was:

“What is the total cost to date for each of the following:

1.    Engagement of an independent note taker

2.   Engagement of a governance advisor to provide instruction as per the recommendations of the Municipal Inspector?

3.     Any third party consultant’s fees in the performance appraisal of the current CEO? (ruled inappropriate)

4.   The total legal costs pertaining to the reappointment of the CEO in 2008?

5.    The additional advice sought from 4 independent heritage advisors on the 466 Hawthorn Rd property?

6.    What is the anticipated or actual cost for the external legal advice involved in the GESAC allocations to either the McKinnon
Basketball Association, or the Oakleigh Warriors?

7.     Will any of the above items be expected to accrue more costs? If so, which ones, and what is the range of this expectation?”

COMMENTS: The barred first question did not seek any information regarding outcomes of Newton’s bullying claims. Nor did it seek information as to who else might have been engaged in this matter. The question was purely monetary. As ratepayers footing the bills for such exercises, we believe that residents certainly have a right to know how much such behaviour is costing us!

The second question is similar in that it simply requests financial data – not information on actual appraisals. Hence, residents have a right to know how their money is spent on an issue that has been a festering sore in this municipality for nigh on a decade. Three Municipal Investigations are proof of that!

Motion to Accept: Lipshutz/Magee

LIPSHUTZ:  ‘One of the issues (looked at) is risk management….made very clear in the preamble that all councillors can attend meetings and not just members of the committee….risk management…..has taken up a great deal of time at committee level ….because that’s something that’s very important. (If a disaster happened then it’s important that) this council could be up and running very quickly (and Audit Committee looks at this and makes sure it happens)….Fraud prevention (is also important because council is big business) and deals with many millions of dollars and so many people on staff. Given that there is always the possibility of fraud …..happily this council hasn’t had that….(due to prevention)….and honesty of our employees….but you only need one to make it big….(the Audit committee thus provides) oversight….(Other changes to the charter)…. enhance the role of the Audit Committee and make it clearer (as to what the committee does)….’

Magee declined to speak. Motion passed unanimously. Readers will of course note that many of the issues we’ve highlighted in the past (such as the ‘permanent’ membership of Lipshutz, Gibbs and McLean) did not get a mention. Reading this morning’s Age, one article by Barry Jones struck us as spot on in relation to the level of debate/discussion in this council. The last section of the article is included below:

“Despite the exponential increases in public education and access to information in the past century, the quality of political debate appears to have become increasingly unsophisticated, appealing to the lowest common denominator of understanding.

In 1860, in New York Abraham Lincoln began his campaign for the presidency with a very complex speech about slavery at the Cooper Union, 7500 words long, complex and nuanced. All four New York newspapers published the full text, which was sent by telegraph across the nation, widely read and discussed. In 1860 the technology was primitive but the ideas were profound and sophisticated. In 2011 technology is sophisticated but the ideas uttered by presidential aspirants are embarrassing in their banality, ignorance and naivety.

It is instructive to compare the debate in the Victorian Parliament in 1872 on the Education Act and the debate in 2006 for the Education and Training Reform Act, a consolidation of legislation passed in the previous 134 years. Which debate was of higher quality? In 1872 MPs were discussing ideas – especially ”free, secular and compulsory” education, while in 2006 all the speeches were about management and training as a factor in job creation. In 2006 I suggested that it might be time to actually define ”Education”, something omitted in the draft bill, and to explore its role in personal and community life, but this was rejected as too ambitious.

In 1872 the minister, J. Wilberforce Stephen, quoted the poet and educational reformer Matthew Arnold eight times in his speech and expressed the hope that the legislation would ”set an example to our progenitors in England”. There was no comparable ambition in 2006. No ideas on education were mentioned and it is doubtful how many MPs in 2006 would have recognised Arnold’s name, even as the author of Dover Beach.”

This blog site has been inundated with comments on the GESAC basketball “allocations”. The moderators have decided not to put up some of these comments as a result of their inflammatory and personal nature. However, the issue itself we believe is crucial to the good governance of this council. It should focus the community’s attention on two crucial questions:

  • Is it councillors who run this council, or is it Newton and Burke?
  • Exactly what were councillors told about the ‘expression of interest’ or tender processes? Exactly what did they know? Is there any official “policy’ that has been ratified by council?
  • Were councillors derelict in their overseeing duties on this process?
  • Has Burke acted unilaterally in making the offer? Is this acceptable to the community?

The formal letter of ‘rejection’ signed by Burke to the McKinnon Basketball Association has already been put up as a comment. We reprint it here TOGETHER WITH THE ASSOCIATION’S RESPONSE TO THIS LETTER. We further believe that it behoves all residents to carefully consider the Association’s letter and compare this with the statements signed by Burke. We also maintain that it is in the public interest that such information is out in the public domain.

BURKE’S LETTER

“Thank you for your response to Council’s public Expression of Interest (EOI) process for the use of the facilities at the soon to be completed Glen Eira Sports  and Aquatic Centre (GESAC). The facility is on target to open in late 2011.

We regret to inform you that your application for use has been unsuccessful. This decision has been based on an evaluation process based on three criteria in order of importance and weighting:
1. Community Benefit
2. Price
3. Capacity

In terms of feedback on your application, the following should be noted:
– GESAC is a major community facility and Council wishes to see maximum community use.  The McKinnon Basketball Association (MBA) proposed 2,160 hours of community basketball per annum and Council has accepted a proposal which will see 3,675 hours per annum of community basketball.  This use will be available to any person and any Club which plays with the GESAC-based Association.
– The allocated group offered a wider range of programs for the community.
– The allocated group offered a much more comprehensive marketing program to ensure its success.
– The allocated group offered payment at the level already in place in many similar centres around Melbourne and which will contribute to the Council providing and maintaining the facility without cost to ratepayers.  The McKinnon Basketball Association indicated that it gave a relatively lower financial priority to court hire and a higher weighting to other organisational priorities.

The evaluation process included Council contacting your Association on a number of occasions to encourage the MBA to submit a more competitive EOI.  I acknowledge the time and effort which your Committee put into that process to ensure that your bid represented the considered position of the MBA, taking all factors into account.

Yours sincerely,

Paul Burke
Director Community Relations”

McKINNON BASKETBALL RESPONSE

Dear Paul,

Thank you for your letter of May 24, 2011 (attached) informing me that the McKinnon Basketball Association (MBA) has been unsuccessful in its bid to utilise basketball stadium space in the Glen Eira Sports and Aquatic Centre (GESAC), currently under construction.

Whilst the several thousand MBA members, many of whom are Glen Eira rate payers, will be extremely disappointed by Council’s decision, ultimately we respect that decision.

However, I feel it is necessary to point out some inaccuracies in your letter.

We understand that Council have accepted a proposal from an Association known as the Oakleigh Warriors.

Your letter states that Council’s “decision has been based on an evaluation process based on three criteria in order of importance and weighting:

1. Community Benefit

2. Price

3. Capacity”

Taking each point in turn:

1. Community Benefit. There are a number of problems with this position as follows:

a. The MBA is the largest community based sporting association in the Glen Eira City Council’s catchment area, so it is hard to comprehend how the selection of a much smaller group from outside the area represents a superior community benefit for the residents of Glen Eira;

b. The MBA offers the broadest range of community based programs of any Association locally, and indeed was recently recognised by Basketball Victoria with their inaugural Inclusiveness Award in recognition of our All Abilities program;

c. The fact that you list “Community Benefit” as the number one selection criteria is particularly interesting in light of the fact that you specifically told us in our meeting that Council was not interested in our community credentials, in fact you went so far as to suggest that we should run our All Abilities program in one of our existing cheaper facilities as a means to help find the funds to pay the rental you required.

2. Price. I accept that price was always a sticking point; in fact it was made clear to us on numerous occasions that obtaining the best price was in fact the principle objective of Council. There are a number of facts which are worth reiterating for the record:

a. The MBA is a not for profit organisation, which prides itself on being professionally operated and administered; this professionalism would prevent us from making a financial commitment which we could not afford. This can be borne out by references which we offered to make available, indeed our application was endorsed by Basketball Victoria and Bendigo Bank. It would be in Council’s best interest to ensure that appropriate due diligence is undertaken on the successful applicant’s ability to pay;

b. The price we offered was $32.50/hour; this represents a substantial increase on our current rental costs which would need to be met through increased fees to our members. Our desire to ensure maximum benefit to our community of members makes it tremendously difficult for us to reconcile paying more for GESAC than is charged by the Melbourne Sport and Aquatic Centre, arguably the best comparable facility in the state and possibly the country. Of course it is possible to pay more than the price we have offered for court hire elsewhere but this is typically on a casual basis whereas we made numerous offers for considerable time allocations;

c. Knowing the funding which was provided for construction of GESAC, particularly the last minute state government funding for completion of the multi-purpose stadium, it is clear that at the hourly rental proposed by the MBA, a reasonable payback of the construction costs is achievable. Therefore your comment in relation to the rival offer enabling Council to “provide and maintain the facility without cost to ratepayers” appears to us to be misleading, particularly given that it was made clear to us that the dry areas of the facility will subsidise the pools.

3. Capacity. You have stated that the allocated group offered increased occupancy to the MBA’s offer. It is frustrating to hear this as a reason for Council’s decision considering that the MBA made numerous proposals, ranging from 2 to 7 days per week. We were told in no uncertain terms initially, that Council were keen to see as many groups as possible use the facility and that there was no prospect of extended periods of use for one group; consequently we scaled back our initial offer to address this.

Your letter goes on to make two further points as follows:

“The allocated group offered a much more comprehensive marketing program to ensure its success”. We have a ready-made association of several thousand members, we do not need a more comprehensive marketing campaign to ensure our success. We are already of a size which would enable us to fill GESAC on each weekday evening and all weekend but were discouraged from submitting a proposal along such lines. In fact the other honour recently presented to the MBA by Basketball Victoria was that of fastest growing Association, consequently this point is simply not relevant.

Given the emphasis you place on community benefits in your letter, it seems incongruous that you would take steps to promote an Association from outside the Glen Eira community, which will presumably be seeking to compete with and undermine Glen Eira’s existing, well established and much loved McKinnon Basketball Association.

We wish you well with your endeavours and should things not work out with the allocated group, we would be happy to discuss alternate options.

Club goes to referee

Basketballers lodge complaint with Ombudsman over tender process…..

Jenny Ling

THE Oakleigh Warriors basketball club has lodged a complaint with the Victorian Ombudsman over Glen Eira Council’s tender process for its new sports and aquatic centre.

In May the council awarded the Warriors use of the $41.2 million Glen Eira sports and aquatic centre basketball courts for competitions and programs on Fridays, Saturdays and Sundays.

A month later councillors voted to seek legal advice about the agreement after protests from rival players the Mckinnnon Basketball Association.

Warriors president Geoff Charnley said a letter was lodged last week asking George Brouwer to ‘‘uphold the original decision to award the playing rights to our club and investigate the reason as to why there was an attempt to overturn it’’. ‘‘We think there has been some inappropriate intervention on an open process — that’s disappointing,’’ Mr Charnley said.

‘‘We went through an open, transparent process. ‘‘They made us an offer and we were delighted to receive it.’’ At the June 28 council meeting, McKinnon club members presented a 713-signature petition asking councillors to reconsider the decision.

In a statement, Mayor Margaret Esakoff said: ‘‘Up till now this matter has been handled by officers as it has been regarded as an allocation and all seasonal allocations for sports facilities are operational matters and as such handled by recreation officers…however, councillors are now considering this matter.’’

************

Warriors welcome players at club’s new home

NO basketball players will be excluded from competitions at the Glen Eira sports and aquatic centre, the Oakleigh Warriors team has promised.

Warriors secretary John Wilson said while he understood the McKinnon Basketball Association was disappointed their expression of interest was turned down by Glen Eira Council, ‘‘we’re quite happy to accept teams from McKinnon’’.

Mr Wilson said the Warriors, whose name changed to Glen Eira Warriors Basketball Club last month, had received a letter of offer from the council that had been accepted. ‘‘It was a fair and transparent process,’’ Mr Wilson said.

We have commented previously that it would appear that many ‘straw votes’ are taken in secrecy, behind the closed doors of councillor assembly meetings. Whilst not formal ‘decisions’ as such, it is clear that much goes on in these meetings that need to be looked at a lot more closely. We have to wonder what kind of pressures are placed on recalcitrant councillors who refuse to adhere to the majority line? What kind of discourse actually occurs? Who runs the show in there? Is there even the possibility of bullying and harassment? And why, oh why, is the public performance in council chambers often so diametrically opposed to what we suspect might have been going on behind these closed doors? The perfect example we have to illustrate our case involves Cr. Magee.

Late last year Cr. Penhalluriack is recorded as stating that he has qualms regarding the nature, tone, and content of Council responses to public questions by Mr. Varvodic. His actual statement reads: ““I’m unhappy with all of the answers to Mr Varvodic with the exception of the one relating to Cr Esakoff. I don’t know what to do about it but I think that they are unnecessarily aggressive and I am just not happy about it”. (Council Minutes 14th December 2010). At the next council meeting (February 1st 2011) Mr. Varvodic directed his public questions to each councillor, asking them if they were in any way in agreement with Penhalluriack’s statement. The questions were taken on notice and answered at the following February 22nd Council meeting. Magee responded by stating: “Cr Magee said: “I stand by Council’s responses to all your public questions to date.”

Remarkably, this does not seem to be Magee’s general opinion in November 2010 when the FOI secured document of the Sports & Recreation Committee minutes record the following: “Councillor Magee stated that Nick Varvodic has cause to complain, and the situation has got out of hand with our answers and that we need to bring it back inline. We are the cause of the letters and we need to rectify the situation”.

How does this alleged statement by Magee just 3 months earlier tally with his endorsement of ALL COUNCIL RESPONSES to Mr. Varvodic.  We simply ask:

  • What pressures are brought to bear in councillor assemblies and by whom and to what purpose?
  • How can the community believe anything that is uttered in the public arena when it is becoming increasingly obvious that  public utterances may not accord with reality?
  • When will councillors actually have the gumption to state their opinion honestly and in public? Democracy is after all founded on the rights of individuals to express an opinion and the council chamber must be the forum for genuine debate. Currently it resembles a theatre with carefully orchestrated arguments, voting patterns, motions, and pre-ordained  decisions.

SO WHAT ARE THE SOLUTIONS? HOW CAN THIS COUNCIL MOVE FORWARD? WHAT SUGGESTIONS DO YOU, OUR READERS HAVE THAT WOULD ASSIST OUR COUNCILLORS TO ENSURE GOOD GOVERNANCE? WHAT DO YOU WANT THEM TO DO? We welcome all views!

We’ve just learnt that public questions regarding the Frisbee affair are now being deemed as ‘harassment’ by this council and will forever more be categorised as ‘inappropriate’ and hence will not be read, nor answered at Council Meetings. Regardless of the rights or wrongs of this specific issue, we believe that such an action is unconscionable and denies residents their basic right to question council actions, policy, and veracity of responses.

It would appear that when council is faced with uncomfortable issues that the harassment and bullying card becomes the preferred option. We’ve recently witnessed the bullying allegations against Penhalluriack (presumably for his ‘crime’ of asking questions of the CEO) and now the harassment allegation against those individuals requesting clarification on council’s so called policy of reasonable laws, reasonably enforced’. It would also seem that when Council is unable to answer appropriately for its shortcomings, then the only way out of such a dilemma is to play this harassment/bullying game.

Residents’ rights to ask public questions, to query policy decisions, and to demand accountability and transparency are fundamental to the good governance of all councils. When questions are continually fobbed off and answers are nothing more than dissembling and a game of semantics, then all fair minded people should be outraged. We urge all residents who care about what is happening in this council to send in their public questions and insist that whatever their concern or issue, that these questions are answered comprehensively and honestly.

PS: here is the offending paragraph : “As Council has received over one hundred and thirty (130) Public Questions this year alone on this matter, having consulted with Councillors and considered concerns raised, I wish to advise you that further Public Questions on this matter will be deemed inappropriate pursuant to Local Law 232 (2) (j) (iii) on the grounds that they may constitute harassment. Thank you for your Public Question.”

Given the current outrage at the Murdoch press in England and the tactics employed, we thought readers might like to reflect on the following examples from the Moorabbin Leader. Two stories on budgets are featured – one on the Kingston budget and one on Glen Eira. We ask readers to compare and contrast, and to ponder why this might be happening.

Kingston homes in for $64 rise

1 Jun 11 @ 07:00am by Dimity barber

// KINGSTON homeowners are facing a 4.95 per cent rate rise this year, adding $64 to the average bill.

Ratepayers will be slugged an extra 1.09 per cent rubbish charge to cover the State Government’s landfill levy rise from $30 to $44 a tonne.

Roads will be the focus of the $158 million 2011-12 Budget with $10.6 million set aside for them.

The Budget will also pay off the last of Kingston’s $28 million pre-amalgamation debt while more than $32 million will go towards capital works including $620,000 to upgrade Clarinda Library. The council will spend $150,000 to boost its overworked planning department, now processing 1200 permits annually. The city will add another $1.5 million this year to its $7.9 million green wedge development fund.

Chief executive John Nevins said keeping the rate rise below 5 per cent had been a challenge. “We went through every line of the Budget to find savings,” he said. Rates rose by 7.3 per cent in 2010-11.

Mayor Ron Brownlees said Kingston residents would pay less than the Melbourne average.

“We have worked hard to find a balance between rate revenue and service delivery,” Mr Brownlees said. “At the same time we acknowledge the pressures on pensioners at rate time and will continue to offer an $80 rate rebate, which is in addition to the
$193.40 State Government rebate.”

Glen Eira rates pain lessens

27 May 11 @ 07:00am by Jennifer Ling

// // GLEN Eira homeowners will have more in their wallets after a slight reprieve on rates this year.

The council’s draft Budget for 2011-12 shows a 6.5 per cent rise for householders, lifting the average rates bill by $60 a year.

But it’s a smaller hit than last year when residents faced one of the largest rates rises in Melbourne with a 7.44 per cent jump, lifting the average bill by $92. Deputy mayor Jamie Hyams said last year included garbage charges “sprung on council at the last minute by the Government”.

“It is important we are able to provide the services and facilities that people expect from us,” he said.

“These rate rises will keep Glen Eira as the third lowest-rating council of all inner-Melbourne metropolitan councils.”

The Glen Eira Sports and Aquatic Centre will get the lion’s share in the 2011-12 Budget, with $13 million allocated for capital works, staffing, furniture and fittings.

Other major features are $5.5 million for the Duncan Mackinnon Pavilion redevelopment, and infrastructure upgrades including $4.95 million for roads, $3.29 million for drainage and $1.73 million for footpaths.

Residents can have their say on the draft Budget until June 9.

From today’s Age

Councillors, candidates face  court

  Jason Dowling

July 6, 2011

LOCAL councillors and council candidates across Victoria are being taken to  court  for not declaring conflicts of interest and not detailing who bankrolled  election campaigns.

This month two councillors – including a mayor –  will face conflict of  interest charges in court and last month former Latrobe City councillor Lisa  Price was barred from acting as a councillor for seven years and fined $9000 for  failing to disclose a conflict of interest.

In handing down the decision, Magistrate Franz Holzer said ”a firm statement  of deterrence and denunciation” was demanded to ensure proper local  governance.  ”To my mind, Ms Price’s behaviour fell below acceptable standards of  conduct,” he said.

The charges related to votes Ms Price participated in at council meetings  considering a municipal electoral hearing and a newsletter distributed by  council in which she was found to have at minimum ”an indirect interest”.

Cheryl Wragg,  of the Moe and District Residents Association, said ”the  conviction of councillor Price sends a very clear message to councillors  statewide that they must be aware of the law and act in accordance with it”.

Ararat Rural City council mayor Andrea Marian and Nillumbik  Shire councillor  Belinda Clarkson will also face charges this month regarding conflict of  interest laws. A Shepparton City councillor escaped conviction but received a  $500 fine from a conflict of interest charge in the past year.

Former Brimbank City councillor Tran Siu faces charges related to  distributing unregistered election material and providing false and misleading  information under oath.

Five unsuccessful  candidates for local council have also been charged with  failing to disclose campaign donations – four cases have been proven and fines  of up to $250 issued.

 

The charges against councillors are outlined in a list of prosecution matters  produced by the Local Government Investigations and Compliance Inspectorate.

Municipal Association of Victoria president Bill McArthur said new conflict  of interest regulations introduced this term of local council were complex.

He said there was ”quite a deal of confusion”  when the conflict of  interest rules were  introduced ”with the simplified 79-page guide”.

Cr McArthur said councillors should follow a simple rule. ”It goes back to  the old mantra, where in doubt you should declare an interest and step out of  the meeting,” he said.

He said overall councillors ”are responsible, they are being transparent,  they are endeavouring to comply with the regulations”.

He said councillors ”are more regulated and scrutinised than any other level  of government”.

Local Government Minister Jeanette Powell said most councillors ”represent  their communities with honesty, integrity and in the best interests of their  community, not self-interest”.

But she added any breaches of the code of conduct for councillors ”will be  investigated without fear or favour”.

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