Councillor behaviour and governance

Councillors must ensure there is no conflict or incompatibility between their personal interests and the impartial fulfilment of their public duties. There are a number of obligations councillors are expected to observe in regard to interest and conduct.

Once elected, a councillor must take an Oath or Affirmation of Office before the CEO, which is dated, signed and recorded in the council minutes.

A person who has been elected to be a councillor is not capable of acting as a councillor until the oath or affirmation of office is taken and failure to do so within three months of being declared elected will result in the office of that councillor becoming vacant.

A councillor is also required to complete councillor induction training within six months after the oath or affirmation of office. The CEO must ensure the induction training is available to be taken. After completing the induction training, the councillor must make a written declaration before the CEO.

If a councillor fails to complete the training or make the necessary declaration, the allowance is withheld until the obligations are completed.

The Local Government Act 2020 provides for the development of a Councillor Code of Conduct (Code) which must include standards of conduct to be observed by Councillors.

The purpose of the Code is to incorporate standards of conduct, including prohibiting discrimination, harassment (including sexual harassment) and vilification which which are expected to be observed by councillors in the course of performing their duties and functions.

The Code must include the standards of conduct and any provisions prescribed in State regulations. The standards of conduct will be included in the Local Government (Governance and Integrity) Regulations 2020 which have not been made at the time of publication. The Code may also include any other matters which the council considers appropriate.

There is a statutory obligation for all councils to develop and adopt the Code within the period of four months after a general election, by Friday 24 February 2021. It is necessary for the Code to be adopted by a formal resolution of the council passed at a meeting by at least two-thirds of the total number or councillors elected to the council.

Until a council adopts a Code, the councillors must comply with the existing Code.

Conflict of interest

A conflict of interest arises when a councillor has an interest that is in conflict with his or her duty as a councillor. If there is any doubt as to whether a conflict of interest arises in particular circumstances, councillors should seek advice from the CEO and/or the Governance Manager.

It is the personal responsibility of the individual councillor to decide if he or she has an interest.

The penalties for failing to disclose a conflict of interest are significant. A councillor who fails to disclose a conflict of interest in relation to a material conflict of interest is guilty of an offence and liable to a fine, if convicted, not exceeding 120 penalty unit. (As at 1 July 2020 a penalty unit is $165.22).

Matters being considered by council

A councillor who has a conflict of interest in a matter being considered by a council, a delegated committee or a community asset committee must disclose the conflict of interest in the manner required by the Council’s Governance Rules. They must also exclude themselves from the decision-making process in relation to that matter, including any discussion or vote on the matter at any council meeting or delegated committee, and any action in relation to the matter.

Councillors who have a conflict of interest in a matter at a meeting conducted under the auspices of the council, for example a councillor briefing, are also required to disclose the conflict of interest in the manner required by the Council’s Governance Rules and comply with the relevant procedures set out in the Rules.

Interests

The Local Government Act 2020 distinguishes between general conflicts of interest and material conflicts of interest. The Local Government Act 2020 conflict provisions also apply to members of delegated committee and members of council staff. This focuses on the provisions as they apply to councillors.

A councillor has a general conflict of interest if an impartial, fair-minded person would consider that the councillor’s private interests could result in the councillor acting contrary to their public duty.

‘Private interests’ means any direct or indirect interest of a councillor that does not derive from their public duty and does not include an interest that is only a matter of personal opinion or belief.

‘Public duty’ means the responsibilities and obligations a councillor has to members of the public in their role as a councillor.

A general conflict of interest is not further defined because it relies on what a reasonable person would consider to be a conflict of interest.

A councillor has a material conflict of interest in respect of a matter if an affected person would gain a benefit or suffer a loss depending on the outcome of the matter.

The benefit may arise or the loss incurred:

  • directly or indirectly
  • in a pecuniary or non-pecuniary form

An affected person is:

  • the councillor
  • a family member of the councillor
  • a body corporate of which the councillor or their spouse or domestic partner is a director or a member of the governing body
  • an employer of the councillor, unless the employer is a public body
  • a business partner of the councillor
  • a person for whom the councillor is a consultant, contractor or agent
  • a beneficiary under a trust or an object of a discretionary trust of which the councillor is a trustee
  • a person from whom the councillor has received a disclosable gift.

A disclosable gift means one or more gifts with a value of, $500 or more* received from a person in the five years preceding the decision on the matter:

  • if the person held the office of councillor at the time the gift was received; or
  • if the gift was, or gifts were, or will be, required to be disclosed as an election campaign donation— but does not include the value of any reasonable hospitality received by the relevant person at an event or function that the relevant person attended in an official capacity as a councillor.

* Regulations may prescribe a different amount. At the time of publication the disclosable gift threshold was $500.

The Local Government Act 2020 also sets out various exemptions to the conflict of interest provisions where a councillor is deemed not to have a conflict of interest despite an interest existing. A conflict of interest does not arise where:

  • it is so remote or insignificant that it could not be reasonably regarded as capable of influencing the actions or decisions of the councillor in relation to the matter
  • it is held in common with a substantial proportion of the residents, ratepayers or electors of the municipal district and does not exceed the interest held by the other residents, ratepayers or electors
  • the councillor does not know the circumstances that give rise to the conflict of interest, and could not be reasonably expected to know those circumstances
  • the councillor is the representative of the council on a not-for-profit organisation that has an interest in the matter and councillor receives no personal advantage from the not-for-profit organisation
  • a family member of the councillor is a member but not an office-holder of a not-for-profit organisation
  • the councillor is a member of a not-for-profit organisation that has expressed an opinion or advocated for an outcome in regard to the matter
  • the interest arises in relation to a decision by a councillor on a matter or in a circumstance that is prescribed to be exempt by the regulations.

Council documents and staff

A council must develop and adopt many important strategic and financial planning and reporting documents as required by the Local Government Act. This includes a Community Vision, Council Plan, a Financial Plan, Asset Plan and Revenue and Rating Plan as an integrated strategic planning framework. In addition, the Council is required to prepare an Annual Report, which includes progress against the Council Plan and strategic initiatives and audited financial statements. The Mayor must report on the implementation of the Council Plan by presenting the annual report at an open council meeting.

The Community Vision must describe the municipal community’s aspirations for the future of the municipality for the next 10 years at least. The Community Vision must be developed or reviewed and adopted by 31 October in the year following a general election and will have effect from 1 July of that year.

In addition, the council must develop and adopt a Financial Plan by 31 October 2021, an Asset Plan by 30 June 2022 and a Revenue and Rating Plan by 30 June 2021.

Council plans

The council must develop or review the Council Plan which must be adopted by 31 October in the year following a general election. The Council Plan take effect from 1 July in the year following a general election.

Annual report

Each year the council must also prepare an Annual Report, which reports on the achievements and activities of the council for that financial year. The Mayor must report on the implementation of the Council Plan by presenting the annual report at an open council meeting held within four months of the end of the financial year. The Annual Report is available to the municipal community and other stakeholders.

Councillors are responsible for determining the council’s annual budget. This includes a general description of the services and initiatives to be funded during the year and the level of rates and charges required to fund them.

Councils seek to make the most out of the revenue available. The budget process also involves setting priorities and allocating funds to achieve the major initiatives identified as priorities in the Council Plan, to be undertaken in the financial year.

Councillors, at council meetings, monitor spending against the annual budget and the achievement of council objectives.

Councils, in making decisions, are required to take into account the following financial management principles:

  • revenue, expenses, assets, liabilities, investments and financial transactions must be managed in accordance with a council's financial policies and strategic plans;
  • financial risks must be monitored and managed prudently having regard to economic circumstances;
  • financial policies and strategic plans, including the Revenue and Rating Plan, must seek to provide stability and predictability in the financial impact on the municipal community;
  • accounts and records that explain the financial operations and financial position of the council must be kept.

A councillor’s role in forming strategic land use and development plans and deciding planning applications can be challenging and time consuming.

Councillors contribute to the review of the council’s Local Planning Policy Framework which sets a local and regional strategic policy context for a municipality. The Local Planning Policy Framework is made up of a Municipal Strategic Statement and specific local planning policies.

Each council, as planning authority, must prepare a Municipal Strategic Statement that provides the broad local policy basis for making decisions under a planning scheme. The Local Planning Policy guides how discretion in a zone, overlay or a particular provision will be exercised. Active participation in the development of the Statement and local planning policies will form a sound strategic basis for decision-making on planning applications.

Councillors often have to decide on contentious development proposals after considering opposing viewpoints from ratepayers, developers and other interested parties. Issues requiring council’s consideration when deciding applications include objections and submissions received by the council as well as environmental issues, visual amenity considerations, impact of a development on neighbourhood character and economic and social considerations.

Relevant strategic plans, policy statements, guidelines or codes may also assist a council when deciding a planning application. It is important that council policies are clear and unambiguous so as to provide guidance to council officers who are delegated the power to decide applications.

Management accountability is a fundamental responsibility of the elected council.

When council has decided on its direction, strategy and policies, the CEO has responsibility for implementing these decisions and managing day-to-day operations.

The CEO is employed by the council under a contract of employment which cannot be longer than five years. The contract of employment must specify performance criteria to enable at least an annual review of the CEO’s performance.

To achieve the best results for the community, a council needs effective working relationships between councillors, the CEO and council staff. While councillors determine policy directions for the municipality, they also rely on advice from the administration.

The administration’s role is to provide relevant and timely information to council. Councillors evaluate options and assess the impact of decisions before deciding what is in the municipal community’s best interest. The administration then implements the policies determined by the council.

There needs to be a shared commitment to the values and goals of the council by both councillors and senior management. Mutual respect within the council team, and between council and senior management is vital to a smooth and professional working relationship between the parties.

The CEO’s functions

The CEO has two main functions: ensuring the effective and efficient management of the day-to-day operations of the council and supporting the Mayor and councillors in the performance of their roles.

Supporting the Mayor and the councillors includes:

  • ensuring that the decisions of the council are implemented without undue delay
  • ensuring that the council receives timely and reliable advice about its obligations under the Local Government Act or any other Act
  • supporting the Mayor in the performance of the Mayor's role
  • setting the agenda for council meetings after consulting the Mayor
  • when requested by the Mayor, reporting to the council in respect of the implementation of a council decision
  • carrying out the council's responsibilities as a deemed employer with respect to councillors, as deemed workers, which arise under or with respect to the Workplace Injury Rehabilitation and Compensation Act 2013.

Ensuring the effective and efficient management of the day to day operations of the council includes:

  • establishing and maintaining an organisational structure for the council
  • being responsible for all staffing matters, including appointing, directing, managing and dismissing members of council staff
  • managing interactions between members of council staff and councillors and ensuring that policies, practices and protocols that support arrangements for interaction between members of council staff and councillors are developed and implemented
  • performing any other function or duty of the CEO specified in the Local Government Act or any other Act.

It is the council’s responsibility to appoint the CEO, negotiate contractual obligations, and manage and review their performance.

While the separation of policy-making and day-to-day management is important, it should be managed so as to establish a sound and effective working relationship.

“My defining moment I think was having leadership opportunity. Learning, offering advice, giving advice and being diverse in that advice and representation was a huge privilege and a huge responsibility.”

Colleen Furlanetto OAM, former mayor and councillor at Strathbogie Shire.