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Letter to Minister Powell .. Council funding MAV for “YES” vote unlawful.
RATEPAYERS VICTORIA INC. 8/1248 North Road Oakleigh South 3167
Web: http://www.ratepayersvictoria.com.au
Email : ratepayersvictoria@gmail.com or, bra.reynolds088@ gmail.com
Phone 03 9570 6227, 9589 2818 or 9874 0784.
17 June 2013
The Hon Jeanette Powell MLA, Minister for Local Government , 8 Nicholson Street, E/Melb, By email to: jeanette.powell@parliament.vic.gov.au
Dear Minister Powell,
Public Money Being Used to Support a YES Vote in the coming Referendum.
Thank you for the response to my letter dated 1st June 2013, as acknowledgement dated 10th June 2013, which indicates that the matter will be addressed in the normal course of business. From earlier experience that could mean weeks rather than days. This may be too late to enable prompt and fair resolution of the matter.
The current situation appears to be that a number of Councils are sending public money to the MAV which is then sending it on to an unregulated body, the Australian Local Government Association. We see this as a scheme to defraud the true owners of the money if we relate to S 74A of the Constitution Act 1975 (Vic). As such, Councils have no financial capital and may make payments only for a purpose set out in a budget and plan prepared and approved in the manner described in Parts 6, 7 and 8 of the Local Government Act 1989 (Vic) [LGA]. So far we have been unable to find any Council which has made budget provision for voluntary payments to be made to the MAV, to be onsent to the ALGA, for the purpose of supporting the ‘Yes’ case in a referendum which has yet to be legalized by the Australian Parliament.
At the very least, Councils must prepare a revised budget (s128 of the LGA) in order to make these controversial payments. Such a revised budget must then follow the notice provisions and the Public Process set out in s223 of the LGA. Any allocation of funds outside of the budget process is ultra vires – without authority.
All Councillors are required to be on the Electoral Roll. As such they have an obligation to vote in support of either the YES or NO case. When a revised budget to provide funds to promote the support one of their choices comes before Council serious difficulties arise. These are as follows:
A Councillor
- must avoid conflicts between his or her public duties as a Councillor and his or her personal interests and obligations. s76BA(a), and
- endeavor to ensure that public resources are used prudently and solely in the public interest. s76BA(c), and
- must not misuse his or her position to gain, directly or indirectly, an advantage for themselves or any other person. S76D(1)(a).
- must not use public funds or resources in a manner that is improper or unauthorized. S76D(2)(c).
When the matter comes to the vote, all Councillors will have either a direct or indirect conflict of interest. Direct interests are covered by s77B(1) which reads:
A person has a direct interest in a matter if there is a reasonable likelihood that the benefits, obligations, opportunities or circumstances of the person would be directly altered if the matter is decided in a particular way.
Indirect interests are covered by s78B(1)(a) which reads:
A person has an indirect interest in a matter because of a conflicting duty if the person:
(a) is a manager or member of a governing body of a company or body that has a direct interest in a matter
Further, ALL Councillors have a personal conflict of interest in any vote to allocate public funds which may be used for partisan purposes.
Obviously, because of the widespread conflict of interest, a quorum will be unable to be assembled. There is provision for the Minister to consider a written application from Council or the CEO to exempt Councillors from the conflict of interest obligations. (s80(1)(a) and (b)). The Minister must consider the public interest s80(1B)(b) before giving any exemption to any one or other group of Councillors.
In summary there are reasons set out in s76 of the LGA which prevent Council from making gifts of money to the MAV for purposes not related to the legal functioning of the MAV, and not related to the proper/legal function of Council for the (direct) benefit of the local community. Without express written permission of the Minister, any resolution to provide funds from the public purse for partisan referendum support cannot be put for want of a quorum.
For its part, the MAV (acting as banker) is unable to accept money “for a joint purpose by councils or a council and any other body” unless this body has been declared (as suitable) by the Governor in Council. (s17 of the Municipal Association Act 1907).
This issue has already gathered substantial momentum with funds firmly committed by a number of Councils. We expect the Minister to bring the matter to a halt – possibly by seeking an appropriate injunction in the Supreme Court of Victoria, or by immediately issuing a guideline determination in the matter. We ask that if this responsibility is not to be accepted by the Minister, we be advised within seven days of the date of this letter in order to arrange an appropriate course of action.
Yours faithfully
George Reynolds, Vice President.
Ratepayers Victoria Inc. is preparing to lodge an injunction on the MAV
The MAV is lobbying council’s to contributed to a “voluntary levy” to fund a campaign to convince ratepayers to vote YES in the Federal Government referendum. It is said this money will go to the ALGA for a national effort. RVI understands the MAV have currently (as at 15/6) been provided $725,223.00 of ratepayers funds without people approval, or approval of the Minister. Only some of the council’s have been conned to contribute.
RVI urges all ratepayers to vote NO … and Google www.realaussienews.com/site 3/ for more information on the referendum, councils and rate issues.
This referendum is another attempt to control Local Council’s in the long run, and to open opportunity for federal funds to support ailing electorates – and, at the right time, prop up their federal votes! It also opens the door to councils being seen as “government” when they are not.
So, what can be done to stop this massive misuse of public money from local councils? RVI is looking to use a court injunction to ensure the improper use of public funds is stopped.
We need funds to fight this grab for power and the improper use of public funds. Donations can be made to RVI via debit payment direct to our bank account:
Whittlesea Branch, address to Ratepayers Victoria Inc., account No. 063855 10127765, or, by cheque or money order and post to the RVI secretary. Unit 8/1248 North Road, Oakleigh South, 3167.
Monash Ratepayers Pushing for Community Governance
In December 2012, MRI commenced its community governance activities. Today, we would like to share our successful milestones:
- Implementation of a report card program for evaluating and reporting the behavioural and decision making performance of Councillors and Mayor’s meeting control competence during Council meetings – seehttp://monashratepayers.wordpress.com/governance/council-meeting-qs/, which has resulting in sustaining improvements since starting in Dec/Jan.
- Trialling a pilot for checking due diligence in Councillors’ reimbursement claims, policy and administration execution– see http://monashratepayers.wordpress.com/governance/councillors-reimbursements-reviews/
- Facilitated escalation of long standing community issues – see http://monashratepayers.wordpress.com/governance/issues-mgt/issues-registry/
- Contributing to Government inquiries in representing Monash ratepayers’ voice in government reforms, strategy planning and programs implementation matters – see http://monashratepayers.wordpress.com/governance/inquiry-submissions/ and http://monashratepayers.wordpress.com/governance/monash-have-your-say-inputs/
As a result of these short term achievements, the ultimate community benefits MRI has helped accomplished in Q1, 2013 are
- Since Feb 2013, Council meetings have become more civil and compliant to code of conduct expectations and showing ongoing gradual improvements in decision making quality and Mayor’s control of meeting;
- More significantly, Council has confirmed a back to basics budgeting resolve for sustaining a rate increase of 6% (as originally planned) for next financial year – a target MRI has consistently communicated publically.
For more information of what Monash Ratepayers are doing, visit their website on http://monashratepayers.wordpress.com/ and contact them to help you exercise democratic governance in your Council – http://monashratepayers.wordpress.com/contact-us/
Local Government Investigations and Compliance Inspectorate
Read more in
http://www.mooneevalleyweekly.com.au/story/1412345/moonee-valley-councillor-misused-her-position/
Choose one topic from the unit guide of the examples given in the assignment brief in the unit guide – ie This is
1. an assessment of Country attractiveness and entry strategy report OR only entry strategy
2. a review of the internationalisation of the organisation OR
3. a review of the local operations of the organisation and its relationship with its overseas parent and how it deals with international strategic issues such as decision-making, autonomy, communication and control, finance and marketing, hrm, production etc (remember this is all about international relationships NOT local operational issues).
4. Etc – relate to topics in Unit Guide
This chosen topic is the core theme of the case analysis and also influence how you write & organise the case story.
Try not to do 1 as almost the 2 classes are doing that.
Ratepayers may not be aware of the Councillors misusing their positions
Eugene Benson from Moonee Valley Weekly reports (26 Mar 2013):
Councillor Shirley Cornish to face court
FORMER Moonee Valley mayor and current Rosehill ward councillor Shirley Cornish will appear in the Broadmeadows Magistrates Court on April 4 to face a charge related to her actions while mayor in 2010.
Cr Cornish is the second Moonee Valley councillor to be charged by the Local Government Investigations and Compliance Inspectorate after its investigation into allegedly improper payments made to the city’s former chief executive Rasiah Dev. Cr Cornish has been charged with one breach of section 76D of the Local Government Act 1989 for the alleged misuse of her position to obtain an advantage for Mr Dev.
It is alleged that as a consequence of the misuse of her position, Mr Dev gained an advantage of more than $13,600.
The charge specifically relates to an allegation that Cr Cornish signed a document with a council letterhead that endorsed a variation to Mr Dev’s contract. That variation is believed to be a 5 per cent wage increase resulting in a $13,600 gain for the former chief executive. Any variation to a chief executive’s payment is required to be brought before the entire council.
In December, fellow Moonee Valley councillor Paul Giuliano was found guilty by the Broadmeadows Magistrates Court on a similar charge relating to his time as mayor in 2009.
He was handed a $1000 fine, but was allowed to continue all normal duties as a Buckley ward councillor.
The Weekly understands Cr Cornish’s hearing may last for three days and include as many as 30 witnesses. Cr Cornish would not be drawn to comment on the charge but is expected to plea not guilty.
By choosing that plea she would leave herself open to paying legal fees if proven guilty.
Mr Dev left the council in April 2010 and is now Darebin Council’s chief executive. Darebin Council has been subject to its own external investigation since appointing Mr Dev.
Councils’ cash grabs from ratepayers’ landfill levy / carbon tax
Indeed “best value” for Councils who increase rates to include provision for carbon tax and are keeping the money because they dont know how much to pay for landfill levy!!!
Watch the Seven Channel news video to find out more.
Residents in dark on rates hikes
Extract from the Age, February 21, 2013: Richard Willingham reported:
VICTORIA’S nearly 80 local councils do not properly consider the impact that rates increases have on residents, with ratepayers not afforded transparency on how and why councils set annual rates, the Auditor-General has found.
An Auditor-General’s report tabled in Parliament on Wednesday said the current rating framework lacked ”clarity, detail and direction”.
Victoria has 79 councils that all rely on the revenue generated by property-based rates and charges to provide services to local communities.
The report found that there was a ”limited assurance” that all councils ”systematically and rigorously” considered the information needed to understand the impact of rates proposals on their communities
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”Councils primarily rely on their annual budget development process to engage ratepayers about rating decisions,” the Auditor-General said.
”While they do respond to ratepayer submissions as part of this process, they do not always adequately explain how they have considered their issues in the rate-setting process.”
In 2011-12 councils generated operating revenue of $8.18 billion, with rates and charges making up $4.09 billion.
The Auditor-General found that between 2001-02 and 2009-10, mean rates per property assessment in Victoria increased by an average of 6.3 per cent a year, outstripping Consumer Price Index rises.
The Auditor-General found that the state Department of Planning and Community Development did not proactively support or guide councils and could not provide assurances that laws for councils on rates were being applied.
It recommended that reporting of data should be improved and standardised so that it is consistent across all councils and easily interpreted by residents.
”Council engagement and communication with ratepayers on rating decisions and rate matters varied significantly in depth and quality. Councils do not provide sufficient or consistent information to ratepayers about their rating decisions,” it said.
The report also identified the major drivers of rate increases in 2012-13, which included the carbon tax, maintaining services and cost shifting by other levels of government.
Local Government Minister Jeanette Powell said the report showed the importance of the decision to develop a mandatory performance reporting framework for local councils.
“The policy development will help councils to develop a more strategic approach to the use of rates and provide the public with a better understanding of how their local council is performing,” Ms Powell said.
She said Local Government Victoria will release an updated rating strategy guide after the ministerial guidelines for differential rates – some councils charge pokies venues double rates to fund problem gambling projects – are finalised.
Shadow local government minister Richard Wynne said rates are a substantial impost on every household and that it was ”incumbent on all local governments to be as transparent as possible in informing ratepayers on how rates are collected and what they are used for”.
Above the Law
Tessa Hoffman from the Monee Valley Leader ( 19 Dec 2012) reported:
Councillor guilty over illegal pay rise
A MOONEE Valley councillor has pleaded guilty to misusing his position to get a former council chief executive a pay rise.
Paul Giuliano today pleaded guilty to misusing his position while he was mayor to get a 5 per cent increase on former chief executive Rasiah Dev’s salary from $315,000 to $330,750 from January 2009, resulting in a total of $34,678 extra pay starting in January 2009.
Variations to chief executives’ contracts must be subject to a formal council resolution.
Broadmeadows Magistrates’ Court heard an independent consultant had recommended that Mr Dev receive a 5.3 per cent pay rise following a favourable performance review by councillors.
Prosecutor Peter Matthews told the court Mr Giuliano discussed the matter with councillors at “at least one meeting” and over the phone, and acting on an assumption councillors had agreed to the pay rise, he asked the human resources manager to authorise the increase.
Defence counsel Jonathan Maher told Magistrate Robert Kumar that in the past 10 years, no chief executive’s pay rise had gone before the council and there was no policy or procedure in place for the process.
The court heard a councillor found guilty of a deliberate misuse of position could receive a $10,000 fine and be disqualified from sitting for seven years.
Mr Matthews said Mr Giuliano’s action was “not a deliberate misuse of his position … more he ought to have known”.
Magistrate Kumar said he was amazed the incident occurred.
“Ratepayers will have concerns about this council,” Magistrate Kumar said.
Magistrate Kumar accepted that council officers did not help Mr Giuliano and there was no system in place.
He ordered Mr Giuliano to pay the court fund $1000 and $5000 in court costs.
He was given a 12-month good behaviour bond.
No conviction was recorded.
Outside court Mr Giuliano told the Moonee Valley Leader he could continue as a councillor because no conviction was recorded.
Mr Dev is now the chief executive at Darebin Council.
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Jack Davies commented:
“As President of Ratepayers Victoria the blatant abuse of the local Government act by Paul Giuliano at the MOONEE Valley council is an example of the protection by the labor party in spite of the local Government act. When the courts start ignoring such breaches of the act and complaints by Ratepayers we are on the verge of treachery. Jack Davis President RPV INC.”
Darren Grey from The Age, 14 Dec 2012 reports:
A $533 million superannuation black hole confronting local councils and other employers, combined with future potential deficits could force councils to cut services and increase rates, a report warns.
The report says a council superannuation scheme now experiencing a massive shortfall would be ”one of the biggest financial risks facing councils for the next 10 to 15 years”.
It urges the Victorian and federal governments to help councils, by agreeing to reforms to ease the pressure.
The report has been prepared by a taskforce acting on behalf of the Municipal Association of Victoria.
It says: ”The consequence of the shortfall will be severe for the sector. Councils will not be able to provide infrastructure and services as planned to the community.
”This will have an influence on people’s lives as valuable community services are cut, rates are increased, or more debt is taken on.”
The financial headache, which is particularly sharp for some country councils with small budgets but big superannuation shortfalls, came to a head when actuaries calculated a $453 million shortfall in a Defined Benefit Plan superannuation scheme used by thousands of Victorian council workers. The financial impost on councils and other employers jumps by about $80 million when superannuation contributions tax, which must be paid, is included.
The report makes 19 recommendations to deal with the $533 million black hole, including calling on the federal government to waive or rebate the superannuation contributions tax.
It urges councils to consider the impact of wage rises on superannuation liabilities, consider paying their shortfall with cash rather than borrowings and to increase their employer contributions..
The Local Authorities Superannuation Fund Defined Benefit Plan was closed to new members in 1993, but there are still almost 5000 people in the workforce who are still contributing to the scheme. There are also thousands of ”lifetime pensioners” and ”deferred beneficiaries” who are still entitled to payments from it.
Workers in the Defined Benefit Plan who choose to take a pension when they retire are guaranteed a pension for life. When they die the pension entitlement is transferred to their spouse, but at a reduced rate.
The $453 million superannuation deficit, which is due on July 1 next year, falls overwhelmingly on councils, although other bodies such as water authorities are also affected.
Families will pay $1300 more for CityLink, water and power
Michelle Ainsworth and Karen Collier from the Herald Sun (14 Dec 2012) reports that ” A CityLink toll rise is the latest hip pocket slug, driving up costs by as much as $76.80 a year for the average motorist from January 1. The latest sting follows increases to electricity and gas bills, as well as myki fares, also set to take effect from January.”
Similar news from John Ferguson of The Australian (14 Dec 2012) also reported:
Victoria eyes tax hikes to fill $2.5bn hole
HOUSEHOLD tax increases of more than $1000, including a new state land levy on the family home, will be needed to fund an annual $2.5 billion budget black hole caused by Gillard government cost-shifting, according to explosive advice to Victorian Treasurer Kim Wells.
The Victorian Treasury has warned that the commonwealth’s education, injury insurance and disability reforms will dramatically undermine the state’s finances in future budgets and lead to sweeping tax increases and spending cuts. As the states argue they are facing a breakdown in commonwealth-state financial relations, The Australian can reveal that Mr Wells has been warned that cost-shifting to the states will mean his budget will have to find an extra $2.5bn each year once the reforms are fully operational.
The paper warns that Victorian taxes would need to increase by 15 per cent to cover the impact of the Gonski education reforms, the National Disability Insurance Scheme and the National Injury Insurance Scheme.
Treasury has also warned that the costs associated with the multi-billion dollar pay rise to low-paid community sector workers and expiring national partnerships are posing significant “medium-term” risks for the budget.
The Treasury paper will ignite debate among all states, with predictions also believed to show that the impact outside Victoria would be equally significant.
South Australia’s Labor Treasurer Jack Snelling warned last night that the budget position was already tight.
“We have little capacity in the current budget climate to be funding large-scale reforms,” he said.
The Victorian Treasury paper warns that as well as putting a land tax on the family home, the government would also have to consider increasing existing land tax by 50 per cent or requiring all small businesses, charities and schools to pay payroll tax.
Other revenue options include a 75 per cent increase in stamp duty on housing and increasing insurance duty rates from 10 per cent of insurance premiums to 35 per cent of such premiums.
It also has raised the spectre of annual motor registration fees rising from $232 to $800.
Senior Victorian government sources have warned that if, or when, Julia Gillard loses office, there will be a “ticking time-bomb” left for the Coalition states from a “creeping coerciveness” regarding federal-state finances.
“To make the contributions that the commonwealth is seeking while continuing to maintain Victoria’s sound budget position, the Victorian government would need to either make significant cuts to current expenditure in other policy areas or increase taxes,” Mr Wells has been told.
“That is, tax revenue would need to be increased by 15 per cent to raise an additional $2.5bn.”
A spokesman for Wayne Swan said Mr Wells should concentrate on his job. “The government is still negotiating these ground-breaking reforms with the states, and we have said repeatedly that we’ll make the decisions necessary to fund our share,” he said.
“It really is about time the Victorian government stopped manufacturing distractions from their own shortcomings in managing a budget.”
Mr Wells has also been told the cost of funding these initiatives would impose constraints on Victoria’s policy and financial autonomy in these areas.
The $2.5bn figure quoted by Treasury is reportedly conservative and forecast to kick in by the 2020-21 budget, although the impacts begin almost immediately and rise each year.
On the basis of just Gonski, the NDIS, NIIS and expiring national partnerships by 2014, the impost to Victoria would be $2.3bn. The national figure would be slightly more than $8bn.
This does not include the estimated $1bn gap in the commonwealth’s offer to the states for the pay rise for low-paid community sector workers.
Victoria is yet to agree to participate in the commonwealth’s proposed reforms of disability or education policies, and the resistance is due in large part to concerns about the fragile state of Victorian finances.
Victoria’s Treasury based its assumptions for the Gonski reforms on the school funding model provided by Canberra.
Figures are based on the cost of fully implementing the commonwealth’s proposed school funding reforms in 2010, expressed in 2014 dollars but without taking into account enrolment growth.
Treasury assumes a 50-50 funding split to implement the NDIS with contributions based on population share and based on the spending estimates for 2013-14.