Local Government Amendment (Governance and Integrity) Bill 2024

18th of June 2024,
Victorian Legislative Council, Melbourne

On Tuesday 18th of June 2024, the Local Government Amendment (Governance and Integrity) Bill 2024 was brought to the Legislative Council for discussion. Rachel Payne made her contribution, before raising her questions on the Bill to The Hon. Lizzie Blandthorn, Deputy Leader for the Government in the Legislative Council.

RACHEL PAYNE (South-Eastern Metropolitan): I rise to make a contribution to the Local Government Amendment (Governance and Integrity) Bill 2024 on behalf of Legalise Cannabis Victoria. I would like to begin by reflecting on why this bill has ended up before us today. In this term alone we have seen 11 councils appointed municipal monitors for urgent intervention, multiple councils dismissed and replaced with administrators, numerous councillor resignations and the Operation Sandon special report. IBAC’s Operation Sandon investigated allegations of corrupt conduct involving councillors and property developers in the City of Casey, in my region of South-Eastern Metropolitan. It exposed behaviour that did not meet the required standards and highlighted the risk of corruption in local government. IBAC’s acting commissioner at the time Stephen Farrow noted the impact of planning decisions on the liveability of all Victorians. In doing so, it was made clear how essential it is that these decisions be protected from corruption.

There is a real need for reform to restore faith in government at the local level. Integrity is important at every level of government, and in many ways it is more important at a local level. This is the level of government that impacts people’s lives in some of the most direct ways – whether your local pothole gets fixed, whether your neighbour builds their four-storey house or whether you feel safe on a well-lit street walking home at night. These are just some of the many things your local council has responsibility for.

Councils make decisions that directly affect your quality of life, and these decisions should be made by a representative who has your best interests at heart. Anti-government groups understand the essential role of local councils well. Many are arranging targeted campaigns to get onto local councils, control the decision-making and lobby a conspiratorial agenda – all the more reason we must ensure integrity in our local government. As a member of the Integrity and Oversight Committee, I am acutely aware of the importance of this issue and the work that agencies like IBAC undertake to ensure that they can make recommendations that will improve our democracy. This bill goes some of the way to addressing these issues and strengthening local council governance.

Mandatory ongoing training and the amendments relating to the uniform model councillor code of conduct are both positive, if not overdue, reforms. But all reforms must be balanced. We do not want to go so far with integrity reforms that we undermine the benefits of the separation of state and local governments. This is a concern that many in this chamber have shared. It is also a concern that we have heard echoed by many of the councils in my region. They have been consulted on this legislation and they may agree in principle to things like the model councillor code of conduct and the mandatory training, but they cannot say for certain how it would actually impact them without further details. The details of both have a direct impact on whether training can be delivered in an effective and timely manner. It is our hope that there will be detailed and meaningful engagement with the sector following this bill so procedures and policies can be successfully implemented. To further ensure the successful implementation of these changes we encourage this government to support Local Government Victoria and the chief municipal inspector, to give them the resources they need to assist with these reforms in a timely and cost-effective manner.

We understand that there are councils that support the changes to the indemnification of councillors, particularly given the unpredictable financial burdens of the existing system. But in the same vein, no indemnification could create unequal power structures for councillors with less resources. We would like to see some balance struck here, but in the meantime we recognise that the current system is not sustainable and must change. Similarly, the removal of VCAT jurisdiction and the changes to ministerial disqualification and suspension powers have been controversial. Some we have heard from have praised the removal of VCAT jurisdiction for stopping overtly litigious councillors and providing certainty of outcomes, whereas others have raised serious concerns that the failure to retain VCAT jurisdiction undermines access to justice. We will support this government’s willingness to recognise these concerns, and we will be supportive of any house amendments to that effect.

In the spirit of integrity in local government we will also be supporting amendments by the Greens in relation to political donations and further scrutiny. There are other general areas for improvement that this bill also fails to address – things like mandatory duties, reporting, resourcing, the threshold for disqualification and efficiency measures. With this in mind, I will be putting forward several questions in the committee-of-the-whole stage to understand why these improvements were not undertaken. There is an approach that can balance the independence of local government with sufficient oversight and integrity measures. This bill could be improved to strike that balance in a more meaningful way.

RACHEL PAYNE (South-Eastern Metropolitan): My question is in relation to the scope of the mandatory training requirements and model councillor code of conduct. Can you provide some further detail on the scope and how this will be tailored to address the misconduct issues that we have seen in local government?

Lizzie BLANDTHORN: The bill sets out a comprehensive training program for councillors by requiring councillor induction training to be completed within four months of taking the oath or affirmation of office. Currently, councillors have six months to complete this training. Professional development training is to be completed by all councillors each year of their term beginning in the year following their election; mayoral training is to be completed by all mayors, deputy mayors and acting mayors if appointed for one month or more, within one month of appointment. That clarifies it.

Rachel PAYNE: Why has this bill not adopted the New South Wales approach of explicitly mandating professional development so that councillors must acquire and maintain the skills necessary to perform their role?

Lizzie BLANDTHORN: Part of the role of the steering committee will be to develop that training and look at what is best suited to the Victorian local government sector as opposed to the New South Wales version thereof. Of course, learnings from other jurisdictions are important, but ultimately this will be a decision for Victoria and based in part on the advice of the steering committee.

Rachel PAYNE: Noting the time sensitivity of these reforms, and I know that my colleague Dr Mansfield raised a similar issue, how will both the code of conduct and training requirements be implemented in a way that does not place undue strain on council?

Lizzie BLANDTHORN: Again, part of the role of the steering committee will be to look at how the training is modelled but also to look at the impacts in relation to its implementation. It is certainly envisaged that these reforms will strengthen local government rather than put undue pressure on local government. It is ultimately designed to ensure that our system of local government is fairer and more accountable, and that will be part of the important work of the steering committee. BILLS 70 Legislative Council – PROOF Tuesday 18 June 2024

Rachel PAYNE: So, with the steering committee, I am assuming that there are interactions there between the steering committee, Local Government Victoria and the chief municipal inspector in ensuring that these processes are implemented.

Lizzie BLANDTHORN: My advice from the box is yes.

Rachel PAYNE: That was just by way of informing this next question: what are you doing to ensure Local Government Victoria and the chief municipal inspector are sufficiently resourced to implement these reforms?

Lizzie BLANDTHORN: My advice from the box is that the resourcing requirements are well understood, fit within the portfolio of the Attorney-General and will be appropriately accounted for.

Rachel PAYNE: Why was the decision made to not mandate council’s report when there is a reasonable belief that a councillor has committed serious misconduct, and how does the current approach avoid incentivising non-reporting?

Lizzie BLANDTHORN: I am advised that the model code can include provisions around when reporting can occur. It just has not been developed and included as yet.

Rachel PAYNE: I only have two more questions left, so I will try and cover them quickly. Will the disqualification thresholds of ‘serious risk to health and safety’ or ‘preventing the council from performing its functions’ capture serious breaches of the standards of conduct when disqualifying councillors, and if not, does the current threshold fail to capture things like psychological safety?

Lizzie BLANDTHORN: Ms Payne, if these remarks do not help clarify your question I might ask you to repeat it, but my advice is that the bill enables the creation of the regulations to prescribe a mandatory model councillor code of conduct to apply to all councillors, ensuring their consistent standards of behaviour, meaning that each council needs to develop their own code of conduct for councillors and all councillors will be held to the same standards of professional, legal and ethical conduct expected of them as decision-makers and representatives in their community, and enabling the regulations to be made to prescribe the process for councils to follow to attempt to resolve disputes in the first instance. The reforms implement the three recommendations from IBAC’s Operation Sandon Special Report. Furthermore, Victoria is the only state without a mandatory model code of conduct. However, the local government governance and integrity regulations currently prescribe the standards of conduct. ‘Serious risk to health and safety’ is not defined, so it can include things like risks to psychological safety et cetera.

Rachel PAYNE: And just my final question: what measures are in place to ensure allegations of serious misconduct where a principal councillor conduct registrar decides it does not reach the required threshold can be easily referred to an internal arbitration process?

Lizzie BLANDTHORN: My advice is that under the legislation a principal conduct registrar can still refer it through the relevant process.