How rife is corruption in WA
local government, and what can be done to prevent it?
In 2015, the WA Crime and Corruption
Commission reported to Parliament that ‘systemic weakness’ in the local
government sector had resulted in numerous cases of alleged misconduct,
including eight involving ‘irregularities’ in procuring goods and services—that
is, in awarding contracts to suppliers.
This ‘systemic weakness’, the report
suggested, signifies a widespread failure among local governments to ensure an
adequate degree of control over municipal spending through audit and risk
procedures.
The report suggested that
While it is difficult to
prevent a determined person from committing fraud, the opportunities and
temptations can be greatly reduced through an appropriate control framework.
Well, yes…but how diligent are councils in
maintaining such a framework, and what is it about local government that seems
to attract self-serving ‘determined persons’ with a penchant for trickery and fraud?
Examples of misconduct by council
employees…
In one of those CCC cases, an employee of
the City of Stirling had colluded for seven years with seven different building
contractors, in the process trousering a handsome $600,000 over and above his
legitimate emoluments.
At the Shire of Kalamunda, CEO James Trail
spent more than $800,000 on management systems software, disregarding the more prudent
and frugal limit of $200,000 budgeted by the shire council.
Needless to say, the grateful software merchant
rewarded Mr. Trail by paying for a flight in business class to London, where
he was to attend a conference. As
well, it presented him with $2000 as spending money for the trip and (a nice
touch) tickets for cricket matches at Lord’s.
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| James Trail, former Kalamunda CEO (PerthNow) |
In the Wheatbelt, we’ve witnessed the tragic
case of Dacre Alcock, former CEO of the Shire of Dowerin, who is now doing time
for having over several years redirected hundreds of thousands of ratepayers’
dollars into the gaping coffers of online betting agencies.
…and by councillors
It isn’t only council employees that game
the local government system.
In 2008, the Mayor of Cockburn, Stephen
Lee, was up for re-election. A
property developer with significant real estate interests in Coogee paid
$43,500 to a PR firm to bolster Mayor Lee’s campaign.
Unaccountably—in both senses of the word—the
mayor omitted to declare this generous gift in his annual return.
And speaking of gifts, let’s not overlook
the scandal surrounding Perth’s Lord Mayor, Lisa Scaffidi. Lord Mayor Scaffidi is a sophisticated,
highly intelligent local government personality with the hide of a rhinoceros
and a jumbo-sized sense of entitlement.
(Perhaps she should change her name to Lisa Safari.)
Now there’s a lady with chutzpah. The CCC found her guilty of serious
misconduct relating to an undeclared gift from a corporate admirer, BHP-Billiton. This wasn’t perfume, nail polish or a T-shirt
from Target but a hospitality package worth $36,500 covering the expense of a
visit to the Beijing Olympics.
So does Lord Mayor Scaffidi repent her
offence and humbly beg pardon of the mob? Not on your nelly! Up goes the middle finger, while the
bewitched burghers of Perth confirm the mandate of heaven by re-electing her to
a third term in office.
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| Perth's Lord Mayor, Lisa Scaffidi (ABC) |
And here’s one of my favourites, culled
from the casebook of the Department of Local Government and Communities.
In 2012, a DLGC enquiry found that then City of
Canning Mayor Joe Delle Donne and two other councillors had made
…improper use of their office as council members with the intent and
purpose of gaining directly or indirectly an advantage for the Mayor’s
daughter’s father-in-law and in so doing caused a detriment to the local
government and the persons selected as preferred applicants.
A neat combination, you might think, of
nepotism and patronage. Thank
goodness, nothing like that could ever have happened in York.
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| Joe Delle Donne as Mayor of Canning (The West Australian) |
Mice that roar
Now we travel northwards to Exmouth, a pleasant
seaside town on the tip of Northwest Cape, famed far and wide as the gateway to
Ningaloo Marine Park—where you can swim with whale sharks—and home to an
important defence facility and a large painted replica of a prawn.
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| Exmouth's Big Prawn (Kailis Bros.) |
Although a major fishing and tourist
centre, Exmouth is a small town with only 2594 permanent inhabitants of whom
1469 are electors. Its local
government, the Shire of Exmouth, has 74 full time employees and holds sway
over 6261 sq. kms of the West Pilbara region.
According to the DLGC’s My Council website, the shire’s revenue
in 2014/5 amounted to $16,139,102, compared with an operating expenditure in
the same year of $18,113,046.
The shortfall of $1,973,944 presumably goes
some way to explain why the shire’s FHI (financial health index) weighs in at a
mediocre 65, which is 5 points less than the minimum figure nominated by the
DLGC as denoting a reasonable degree of financial health.
Still, some mice can roar, and the Shire of
Exmouth is roaring even louder, and with greater effect, than the somewhat more
populous Shire of York with its ridiculous Splurj Mahal, the failed York
Recreation and Convention Centre.
A visionary project
The Shire of Exmouth manages several
infrastructure projects, most notably the visionary Ningaloo Centre estimated
to cost about $32m.
I don’t know how much of that will be
extracted from the pockets of Exmouth ratepayers. The development is supported by the Commonwealth Government,
the WA Department of Regional Development, Royalties for Regions and
Lotterywest.
Perhaps providing management services is part
of a partnership arrangement that results in a net financial gain for the shire,
though somehow I doubt it.
I said the project is visionary, and it
certainly is. The facilities of
the Ningaloo Centre will be devoted to scientific research, data sharing with
industry and other interested parties, library services and education, and the
promotion of tourism in the Exmouth region and further afield.
A far cry, then, from York’s white
elephant, with its limited appeal to a handful of sports fanatics (whom it
doesn’t seem on the whole to have served very well) and a gaggle (or gargle) of
superannuated quaffers drawn to the tavern’s promise of subsidised booze like
moths to the proverbial flame.
Admittedly York’s folly has cost—so far—only
about one-third of what will be spent in constructing the Ningaloo Centre.
All that said, I’ve yet to be convinced
that local governments should play any part in financing and managing grandiose
building projects. In my view, those
are enterprises best left to private developers.
In York, the tennis and bowling clubs were probably
much better off before they foolishly lined up behind the Shire’s—that’s to
say, CEO Hooper’s—pharaonic sporting hub fantasy.
Gigantic municipal building projects offer
too much scope and too many ‘opportunities and temptations’ for fraud and other
varieties of bureaucratic misconduct.
But if I had to bet my shirt on the
eventual success of either development, the YRCC or the Ningaloo Centre, I
would unpatriotically but without hesitation back the efforts of the Shire of
Exmouth.
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| Artist's impression of the Ningaloo Centre (Shire of Exmouth) |
Allegations
More’s the pity, then, that the CCC now finds it necessary to investigate allegations of wrongdoing by the Shire of Exmouth’s
CEO, Bill Price, and others on his staff.
At a hearing last week, it was alleged that
Mr. Price, without calling for tenders, had awarded the contract to build a
55,000 litre aquarium to a company, Ocean Reefs Production, that had been
formed only three months previously.
It was further alleged that Mr. Price had
deliberately misled the Shire Council regarding the award of the contract.
In the words of Tony Power, counsel
assisting the Commission:
In the Shire of Exmouth,
there appears to have been a blurring of what should be a bright line between
the personal interests of senior managers including the CEO on the one hand,
and their public functions and their use of public moneys on the other
hand.
Public officers should know
where that line is and they shouldn’t cross it’.
Amen to that.
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| Bill Price, CEO Shire of Exmouth (LinkedIn) |
‘Draining
the swamp’
It’s possible—it may even be probable—that
Mr. Price and his colleagues are innocent of every allegation levelled against
them. Mr. Price is represented by
one of WA’s most senior criminal barristers, Tom Percy QC, who will no doubt
put his client’s case to the Commission with style, vigour and élan.
But it troubles me that stories involving
allegations of serious financial misconduct by public officers—elected as well
as employed—seem to crop up with tedious regularity in the annals of local
government in Western Australia.
Sometimes the miscreants are convicted and
packed off to prison, as happened to poor Dacre Alcock. More often, I suspect, councils
unwilling to admit they were duped, and reluctant for that—and less noble reasons—to
set an investigation going, quietly edge them out of their jobs and try to bury
the evidence as deep as the spade will go.
Saving face, protecting vulnerable
reputations and just wanting to ‘move forward’ at all costs are miserable
motives for suppressing the truth about crimes and misdemeanours perpetrated
against the public interest and the public purse.
In the USA, President-elect Donald Trump
campaigned successfully on a pledge ‘to drain the Washington swamp’. When he’s done working out how to
achieve that objective, he might care to give us a few ideas on how we can
drain the municipal swamp over here.
