Report critical of financial management at WA council

A WA council spent $5,380 chasing a $60 parking fine, undertook a $36,500 legal fight in a matter that had already been dealt with, and gave legal work to a company where the CEO’s son was a partner, a report has found.

Local Government Minister David Templeman

The WA government on Tuesday tabled a report into the Shire of Toodyay which includes 25 findings including 15 involving a former CEO.

“The CEO did not have adequate oversight of the day to day operations of the local government, and this failure by the CEO has caused, or contributed to the potential unnecessary costs to the Shire of Toodyay,” it concludes.

The CEO is no longer employed at the Shire.

The state government launched an inquiry into the wheatbelt council on Perth’s northern metropolitan edge in 2018 in response to a series of complaints about accountability and transparency.

It found poor financial administration and said there was evidence that the then CEO didn’t adequately discharge his duties and that Council failed to take positive action with regards to this.

Overpayment of past CEO

The report said Council had inadvertently overpayed a former CEO, who was employed at the Shire between 2004 – 2010, to the tune of $150,000. It took a $547,000 legal fight before the matter was settled.

The report found the CEO at the time of the dispute failed to keep council abreast of the costs of litigation which prevented informed decisions being made. “Mr Scott, as CEO, failed … to obtain three written quotes for the purchase of goods or services relating to the provision of legal services,” it adds.

It also found Council had spent $5,381 to chase down a $60 fine paid to the wrong person and bore legal costs of $36,500 in a dog seizure dispute even though the dog owner had paid his fines.

Council also paid $82,470 in legal fees to recover $5,500 from a company in a dispute over the provision of services during bushfire assistance.

The report also said of the $1,890,800 spent on legal firms during the time the Mr Scott was employed with the shire, 39 per cent was spent on Civic Legal, where his son was a special council.

The report said the Shire used 13 legal firms during the CEO’s employment. One of these “seemed more prevalent than the others” and on further assessment it was noted that of the $1,890,819 was spent on legal firms during that time, 39 per cent was with CIVIC Legal, where the CEO’s son was Special Council.

The CEO spoke to the shire president but “at no time was the conflict documented or put to the council”.

The report says while the conflict was not an offence, it was unethical and not behaviour that should be expected of a CEO.

Council accepts findings

Local Government Minister David Templeman said councils have a responsibility to oversee and hold their CEO responsible for day-to-day operations.

“The CEO is employed by the council to undertake day to day operations,” Mr Templeman said.

“Council staff and elected members should be aware of their responsibilities and community members should be assured that the administration and council are acting in their best intersts.”

He said the Shire had made a number of improvements since the inquiry ended.

The Shire said the findings of the report were not unexpected.

“As expected, the Report highlighted certain aspects of Council and some operations of administration where closer oversight and control would have been prudent,” it says in a statement on its website.

“The Shire will work with the Department of Local Government to make improvements in the areas identified.”

This story replaces an earlier one which incorrectly stated Graham Merrick was CEO of Toodyay Shire during the events investigated by the report. Mr Merrick left Toodyay in 2010 and was not the CEO referred to in the report in relation to any adverse findings. Government News apologises to Mr Merrick for the error and for any distress it may have caused.

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