Corruption and Crime Commission
Office of the Auditor General WA (OAG)
Local Government Inquiries WA

Corruption and Crime Commission

WA Corruption and Crime Commission
You can report corrupt conduct to the CCC anonymously or confidentially here. 

The CCC reports on corruption, including in local government and makes recommendations, which are helpful when reviewing how well your local government procedure and practices measure up. They make entertaining and elucidating reading. CCC reports relevant to local government include: 

Report into how conflicts of interest undermine good governance – A report on the Chief Executive Officer of the Shire of Halls Creek 30 August 2018 (View/download here) 
“conflict of interest” – “financial interest” – “refuse to accept resignation” – “termination” – “serious misconduct” – “procurement” – “public officer” – “tender” – “whistleblower” – “preferred supplier”- “CEO Rodger Kerr-Newell” 

Report into Allegations of Serious Misconduct by Councillors of the City of Perth between 21 and 24 October 2017 18 December 2017 (View/download here) 
“Attendance fee” – “Councillor allowance” – “allegation, meaning of” – “financial inducement” – “bribe” 

Report on a Matter of Governance at the Shire of Dowerin 10 October 2016 (View/download here) (Link to LGEMA’s Case Study here)
“credit card” – “stealing as a servant” – “financial controls” – “governance” – “audit committee” – “rules of conduct” – “ budget” – “CEO performance” – “CEO excessive power” – “ separation of powers” – “operational” – “governance” – “audit role” – “fraud risk” – “internal controls” 

Report on Misconduct Risk in Local Government Procurement 4 February 2015 (View/download here)
Cities of Cockburn, Joondalup, Perth, Swan and Wanneroo” – “City of Stirling” – “City of Baywater” – “Town of Cottesloe” – “CEO Shire of Murchison” – “audit” – “procurement” – “fraud” – “risk mitigation” – “internal controls” – “record keeping” – “goods and services” – “integrity” – “invoices” – “credit card” – “tender scrutiny” – “verify work done” – “separation of invoice and payment roles” – “gifts” – “CEO oversight” – “payment process” – “conflicts of interest” – “secondary employment” 

Report on an Investigation into Acceptance and Disclosure of Gifts and Travel Contributions by the Lord Mayor of the City of Perth 5 October 2015 (View/download here)
“Lisa Scaffidi” – “gift” – “travel contributions” – “legal advice” – “gift register” – “Misconduct, definition” – “ corruptly, definition” – “annual return, purpose” 

Report on the Investigation of Alleged Public Sector Misconduct by a Local Government Employee in Relation to the Purchase of Management Systems Software 19 December 2013 (View/download here)
“Augusta-Margaret River Shire” – “Kalamunda Shire” – “James Trail” – “procurement” – “ audit” – “ contract splitting” – “anti-avoidance” – “gift register audit” – “misconduct risk” – “public officer” – “CEO financial management duties” – “monopoly suppliers” – “CEO properly informing Council” – “Purchasing Policy breach” – “conflict of interest” – “estimation of gift value, improper” – “Department prosecution” – “Business Ethics Statement” 

Report on the Review of the Capacity of Local Governments in the Pilbara to Prevent, Identify and Deal with Misconduct 16 April 2013 (View/download here)
“Town of Port Hedland” – “Shire of Roebourne” – “Shire of East Pilbara” – “Shire of Ashburton” – “misconduct, definition” – “public officer, definition” – “serious misconduct, definition” – “misconduct risk” – “regional council” – “ misconduct framework” 

Report on the Investigation of Alleged Public Sector Misconduct at the City of Wanneroo 3 December 2009 (View/download here)
“lobbyists” – “fidelity to public interest, public officer duty” – “integrity” – “Cr conduct as public officer, notional test” – “misconduct, standard of proof” – “ Public Sector Code of Ethics for WA” – “ public interest” – reasonable standard benchmark” – “ perception of being open to influence” – “regional council” – “personal commitment to ethical behaviour must be evident in words and actions” – “ Crs prohibited from giving any undertaking [about their future decision making]” 

Report on the Investigation into Allegations of Misconduct by Councillors or Employees of the City of Bayswater 13 November 2009 (View/download here)
“record keeping” –“tender process” – “contract process” –“financial controls” – “time sheets audit” – “ lack of worker’ supervision” – “ Councillor primary and annual returns” – “conflicts of interest” – “Mr Casilli” 

“Serious misconduct in procurement of environmental services” 21 May 2019 (View/download here)
“conflict of interest” – “improper procurement practices” – “ unauthorised disclosure” – “serious misconduct not necessarily criminal or disciplinary offence” 

Report on the Investigation of Alleged Misconduct Concerning the Rezoning of Land at Whitby 3 October 2008 (View/download here)
“Lobbying activities” – “ minor breach of discipline” – “public officers” –“ misconduct” – “intercepting powers” –“ misconduct standard of proof, balance of probabilities” – “balance of probabilities, definition” – “improper release of confidential information” – “ corruption, definition’ – “ disclosing official secrets, crime” – “ breach of discipline as grounds for termination” – “is information inherently confidential” – “Lobbying giving a commercial advantage” 

Report on the Investigation of Alleged Misconduct Concerning Mr Stephen Lee, Mayor of the City of Cockburn 26 September 2008 (View/download here)
“election campaign funding” – “misconduct’ – “fundraising processes” – “failure to declare gift”

Office of the Auditor General WA (OAG) OAG

Contact details email info@audit.wa.gov.au or phone (08) 6557 7500.
For answers to FAQs or to suggest local government audit topics, make referrals or complaints go to audit.wa.gov.au/contact-us/
For reports useful for assessing you local government practices see https://audit.wa.gov.au/reports-and-publications/reports/
Some OAG reports helpful for identifying local government best practice and procedure are listed below.

As OAG reports on administrative practices, these reports can be applied as a measure of CEO performance.

“Regulation of Consumer Food Safety by Local Government Entities” Report 28: 30 JUNE 2020 here

OAG RECOMMENDATIONS:
Local government entities should: 

1. Ensure food business inspections are prioritised & carried out according to their risk classification
2. Ensure changes to inspection frequencies are only made based on a documented assessment of compliance history or other urgent requirement 
3. Improve record keeping for food business inspections and compliance reporting to:
   1. better understand inspection & compliance history
   2. identify compliance issues & follow-up activities
   3. respond to emerging food safety issues.
4. Develop procedures & staff guidance to ensure non-compliant food businesses are followed up & Standards enforced in consistent timely manner
5. Work with Department of Health to develop & implement new electronic food safety inspection & record keeping systems.

“Information Systems Audit Report 2020 – Local Government Entities” Report 27: 2019-2020 25 June 2020 here
“…ALL 10 local government entities (1 regional and 9 metropolitan local government entities – not identified ) had SIGNIFICANT SHORTCOMINGS in their information security practices. Entities need to seriously consider these standards and the recommendations in this report to improve information security practices and protect the confidentiality, integrity and availability of information and systems… 

“We found that entities DID NOT HAVE GOOD PRACTICES TO MANAGE INFORMATION AND CYBERSECURITY. Entities did not have appropriate policies and processes to identify and guide information security practices and they often lacked ongoing monitoring processes to detect and respond to threats. These gaps in security controls seriously undermine the confidentiality, integrity and availability of information held by these entities…”

“Under section 7.12A of the Local Government Act 1995, the 10 audited entities are required to PREPARE AN ACTION PLAN addressing significant matters relevant to their entity for submission to the Minister for Local Government WITHIN THREE MONTHS of this report being tabled in Parliament and for publication on the entity’s website. This action plan should address the points above, to the extent that they are relevant to their entity.”

There are NINE RECOMMENDATIONS about improvements required and an Appendix A which provides, “BETTER PRACTICE GUIDANCE to manage technical vulnerabilities”. 

“Local Government Contract Extensions and Variations” 4 May 2020 here (wrong link)
This report examined BAYSWATER, KWINANA, ROCKINGHAM, SWAN, NARROGIN, WAGIN, SOUTH METROPOLITAN REGIONAL COUNCIL, COTTESLOE local governments.

1. Which of those LG CEOs have made full report to their Council about findings and made recommendations to Council, and placed that report on their local government website as required within 3 months of the OAG report? 
2. Which other local government CEOs reported to their Council about the Best Practice Principles identified in this OAG report?

• Fraud Prevention in Local Government 15 August 2019 here.
• Local Government Building Approvals 26 June 2019 here.
• Verifying Employee Identity and Credentials 19 June 2019 here.
• Engaging Consultants to Provide Strategic Advice 5 June 2019 here.
• Information Systems Audit Report 15 May 2019, 21 August 2018 here.
• Records Management in Local Government 9 April 2019 here.
• Audit Results Report – Annual Report 2017-2018 Financial Audits of Local Government 7 March 2019 here. 
• Management of Supplier Master Files 7 March 2019 here. 
• Local Government Procurement 11 October 2018 here. 
• Timely Payment of Suppliers 13 June 2018 here. 
• Controls over Corporate Credit Cards 9 May 2018 here. 
• Management of Contract Extensions and Variations 8 May 2018 here. 
• Agency Gift Registers 15 March 2018 here. 
• Local Content in Government Procurement 5 December 2017 here. 
• WA Tourism Strategy 2020 30 November 2017 here.
• Rich and Rare: Conservation of Threatened Species Follow Up Audit 6 September 2017 here. 
• Malware in the State Government 7 December 2016 here. 
• Financial and Performance Information in Annual Reports 21 July 2016 here. 
• Regulation of Builders and Building Surveyors 22 June 2016 here. 
• Controls Over Employee Termination 26 August 2015 here. 
• Verifying Employee Identity and Credentials 2 December 2015 here.

Local Government Inquiries WA

Report into the Shire of Perenjori 2019 (View/download here) (wrong link)
Inquiry Findings included:  

• State of Perenjori files relevant to the inquiry, tender registers and electronic records of the Shire was, at best, haphazard. 
• Poor record keeping severely hampered Authorised Persons ability to fully inquire into operations and affairs of Shire.
• CEO Mills breached section 78(1) of the State Records Act 2000 by not ensuring government records were being kept in accordance with the Shire’s record keeping plan, and repeatedly failed to comply with obligations under regulation 17(2) of the Local Government (Functions and General) Regulations 1996 by not including prescribed details on tender register.
• Shire President repeatedly failed to comply with the requirements of section 5.22 of the Local Government Act 1995 and regulation 11(b) and (c) of the Local Government (Administration) Regulations 1996 by confirming minutes of Council meetings that were incorrect and/or otherwise did not include the prescribed information.
• Council has breached regulation 11(f) of the Local Government (Administration) Regulations 1996 for not ensuring the minutes of a council or committee meeting included the information as required for agenda items, nine times
• CEO Mills failed to comply with [Purchasing] Policy by failing to document why three (3) written quotes were not obtained for purchase of goods or services relating to tender
• CEO Mills and Council breached regulations by separating purchases that would otherwise together be put to public tender as contract to supply was more or likely to be more than $150,000.
• Tender Panel failed to comply with Policy by not undertaking evaluation of potential suppliers for [a contract] impartially, honestly and consistently.
• CEO Mills did not comply with Policy … by failing to disclose an actual or perceived conflict of interest in relation to the Shire’s original tender process for [a contract]; may have breached section 5.93 of the Local Government Act 1995 by improperly disclosing SCH’s confidential tender documents; failed to act in accordance with Policy by not evaluating tenders in relation to [a contract] impartially, honestly and consistently; breached section 5.93 of the Local Government Act 1995 by making improper use of confidential information that was known to her by way of her position as CEO.
• Although there has been a degree of deception on the part of CEO Mills, it is also noted that the Councillors of the Shire of Perenjori appear to have been willingly misled and not performed due diligence in all cases.

Report into the City of Melville 2019 (View/download here)
Summary of Key Findings includes:
Public Question Time

• The City was not as open and transparent in relation to their policies, meeting procedures, work instructions and information as they could have been and they neglected to provide the public with information that (what?)
• The majority of questions put to the council and or city were answered with the exception of those deemed to divert a substantial and unreasonable portion of the City’s resources away from its other functions, which is permitted for under section 5.95 of the Act.

Public access to information

•  · The City’s request for further information regarding Complainant A on several occasions before actioning a request to provide information is not appropriate behaviour for a government body.
• The City could have attempted to manage their request in more professional manner. Now that the City has obtained legal advice, this should cease to be an issue
• The City should have been aware of its obligations in the first instance and dealt with the application in a more appropriate and timely manner.

 Managing complaints

•  Officers dealing with complaints need to be mindful that regardless of the complainant all complaints need to be addressed in a professional manner abiding by the process adopted by the City.
• A more robust complaints handling policy would assist in dealing with the issues identified during this investigation particularly regarding a different avenue for persons to take should they be unsatisfied with the outcome.

 Considerations relevant to recommendations

• The good culture of any organisation is at the heart of its success as an enduring institution. To instill confidence in the community that the administration and elected members are, as a collective body, providing good governance which is in the best interests of the community the Authorised Persons have made recommendations for both the immediate and longer term.
• A number of the recommendations will … drive a cultural change which will ensure all parties are better informed, have a better understanding and ultimately more effective and positive governance.

 Actions taken by City/Council
 City and Council has already taken initiatives to improve its governance arrangements by undertaking the following: 

• The Council have reviewed the Public Question Time Policy and have implemented changes.
• The City provided a summary of the City/Council’s trial process for managing public question time on its website.
• The City has upgraded its website.
• The City has engaged WALGA to perform an independent review into City’s Meeting Procedures.
• Internal learning review with the assistance of WALGA to gauge an understanding of how the City could have dealt with complaints differently has also been undertaken.

 Recommendations Include:

1. Consideration be given by Council about engaging an independent person to review and act on complaints about City processes and decisions for a period of 3 months from the date of this report.
2. All senior staff undertake training in complaint management
3. City undergo an independent governance with report in 3 months
4. City undergo a further independent governance review with report in 6 months after the local government elections.
5.  Within 6 months of second report CEO to deliver comprehensive report outlining:
   1. steps taken in response to the above recommendations;
   2. identifying the number of senior staff that have undergone the training as set out in recommendation 3;
   3. updating the status of the Governance Review in relation to the number of elected members and staff who have participated;
   4. the processes the City has put in place in response to recommendation 5; and
   5. the impact, if any, of the updated policies on Public Question Time, Managing Unreasonable Conduct by Customers, Legal Representation and the Complaint Management Policy.

 City of Joondalup Inquiry 2005 Summary para 26.

The tortuous process which commenced with the decision in March 2001 not to renew the position of Mr Delahunty as CEO and ended with the suspension of the Council on 5 December 2003, was one in which elected members strayed many times from the path of rational and otherwise ethical behaviour, both in the way in which they behaved individually towards one another and in the way they behaved as a group, by reason of their decisions, towards the electors whom they were representing. They significantly failed in that regard to provide good government to the City of Joondalup.

Recommendation 13: A committee of the Council of the City of Joondalup should be established to supervise the answering of public questions and report on and recommend action relating to the answers to questions to the Council.

Recommendation 17: Local governments should not hesitate to obtain alternative legal advice or a second opinion, where elected members are divided or hesitant about any advice given.

Recommendation 18: When elected members are considering advice from legal practitioners they should be careful to follow legal advice, so as to ensure that they are not otherwise acting improperly, but Councillors, employees and legal advisers should be careful also to ensure that a distinction is drawn between advice which is legal advice and advice which is strategic advice … and be aware of the discretion which remains in elected members to make decisions inconsistent with strategic advice.

Recommendation 19: The meeting procedures for local authorities should preclude the provision of written legal advice without adequate time to read and understand it before it is acted upon.

Recommendation 21: Local authorities and the DLGRD should co-operate to keep a central register of legal advices which may be of general assistance to local governments, in so far as that may occur without impacting on the need to preserve legal professional privilege

Recommendation 22: A policy should be established by the Council of the City of Joondalup which facilitates full access to legal advice by elected members.

Recommendation 24: The Code of Conduct of the City of Joondalup should be reviewed and a process of adjudication of alleged breaches by an independent referee added, and elected members should be trained in its content.