A CONTRACT which caught the eye of the state Corruption and Crime Commission was given the all-clear by the City of Perth’s governance unit without adequate investigation, an inquiry into the council has heard.
On January 10 last year the CCC sent a letter to then-CEO Martin Mileham after receiving a complaint that a senior staff member had favoured one contractor over another, possibly gaining a benefit along the way.
Emails between the staff member and his direct boss showed they were aware the decision to appoint the slightly more expensive contractor had the potential to raise eyebrows, with one stating “I can’t see a defence” if it was challenged.
In response to the CCC letter, the city’s governance unit contacted Stantons International to carry out a probity audit, but the company was not told to look into the allegation the staff member gained a benefit, whether for himself or others.
“What’s missing from that … is any reference to a review encompassing an assessment of the allegation contained in the CCC’s letter,” inquiry counsel Cheyne Beetham said while questioning the city’s governance manager Mark Ridgwell, who at the time was acting corporate services director.
While an untrained underling filling in for him wrote the audit request to Stantons, Mr Ridgwell wrote back to the CCC giving the staffer the all-clear saying there was “no supporting evidence” for the allegation, even though it hadn’t been investigated.
The most Stantons would say was that it hadn’t been given enough evidence to prove the selection process was unbiased, but even that got spun by Mr Ridgwell who told the CCC no bias had been established.
Mr Beetham put it to Mr Ridgwell that was “not true”.
Inquiry commissioner Tony Power chipped in: “One of the matters that was made fairly clear by the final Stantons report was that there was a reason why there was no supporting evidence, namely, it had not been got”.
Mr Ridgwell said he should not have sent that letter to the CCC, and “in the context of workload that I had at the time, I didn’t give it my full attention”.
by DAVID BELL
New laws to keep councils straight
WITH suspect tenders uncovered by the City of Perth inquiry, local government minister David Templeman says recent laws will empower the state’s auditor general to step in to keep councils accountable.
Previously councils were self-policing when it came to auditing, trusted to organise their own affairs.
The state government changed that system on advice from the CCC in 2015, which had found shonky contract dealings at many councils including Bayswater, Kalamunda, Cottesloe and the City of Stirling, where a building coordinator awarded contracts to his uncle’s business.
“The McGowan government passed legislation [in 2017] that saw the auditor general take responsibility for undertaking local government audits,” Mr Templeman said.
Some councils are already under that remit and it’ll be extended to all of them by the 2020/21 financial year.
The new system sees the auditor general empowered to audit areas aside from finance, including “efficiency, effectiveness and probity”.
Mr Templeman says “this provides more independent oversight than has previously been the case and increases transparency and accountability.
“The McGowan government is [also] currently undertaking a review of the Local Government Act to modernise the act and ensure that, among other things, it continues to provide a contemporary governance framework for local governments”.
by SEAN HILL