WA pushes on with local government audits, councils deny they’re corrupt

By Stephen Easton

Monday May 22, 2017

The new Western Australian government is continuing its predecessor’s plan to place local government under the scrutiny of the auditor-general, in line with most other jurisdictions.

The McGowan government introduced the new amendment bill last week, which would alter the Local Government Act in quite similar ways to the almost identical bill introduced by the Barnett government last August.

The proposal last year was for the the auditor-general to take over auditing local councils from July 1 this year, but this date has been omitted from the new version’s explanatory memorandum. The longer timeline for a staged transition remains the same:

“As the existing audit contracts of local governments expire, the responsibility for auditing local governments will transition to the Auditor General. By financial year 2020/2021, all local governments will be audited by the Auditor General, regardless of whether or not their contracts have expired.”

Local Government Minister David Templeman explained the bill would bring the accountability standards for local governments up to a level more consistent with other jurisdictions, and with agencies of the state government.

The bipartisan legislation finally responds to recommendations made by the Legislative Assembly Public Accounts Committee over 10 years ago. For anyone who questions the the need for the changes, Templeman’s statement referred to recent Corruption and Crime Commission investigations into allegations of serious misconduct and corruption in several of WA’s local governments.

In one case last year, the CCC found the chief executive of the Shire of Dowerin had stolen nearly $600,000 over four years. The much more recent investigation of serious misconduct in the Shire of Exmouth administration resulted in a scathing report earlier this month, with a punchy single-page introduction that is a masterpiece, as parliamentary papers go.

The introduction to the CCC’s report on the Shire of Exmouth.

Not only was Price sacked last December but the council, which did nothing about the serious wrongdoing even when it was presented with clear evidence by the CCC, was suspended for six months and forced to attend governance training.

The CCC suggested these and other cases reflect “structural weaknesses” in the sector but the WA Local Government Association hit back, complaining that it was “unfair and inaccurate” to suggest all WA councils were crooked.

“The Local Government sector accepts significant issues with a small number of Councils and does not set out to defend those who have done wrong, but also should not share in the blame,” WALGA president and East Pilbara Shire councillor Lynne Craigie said in a statement.

“For the CCC Commissioner to claim that Councils have very little idea of their responsibilities or don’t have the required skills is an unfair generalisation and an insult to most who work hard for their communities.”

WALGA would prefer the state spent more on training programs for councillors. The representative body also pointed out the CCC had received over 8500 allegations against WA government agencies in two years, compared with about 700 regarding councils, and that the WA Department of Health was responsible for “$40 million in unauthorised spending on just one contract” — roughly equal to the entire annual budget of five of the “smaller” councils, according to WALGA.

Under the new regime, when it finally comes into being, independent assessments of each council’s financial position will be published by the auditor-general and the local governments themselves will have to publish their annual reports and audit reports online.

WA councils will also be subject to performance audits looking at “the economy, efficiency and effectiveness of programs and organisations, including compliance with legislative provisions and internal policies”, according to Templeman.

“This legislation is long overdue and will address issues concerning the lack of accountability and transparency in some local governments,” the minister said.

“There is absolutely no reason why local governments should not have the same accountability standards as State Government departments and agencies. This legislation brings them in line with the rest of the public service and other jurisdictions.

“It will enable ratepayers to hold their councils to greater account and better protect community interests and funds.”

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