-self audit guide to good governance in local government€¦ · elements of corporate governance in a NSW local government context and to measure their progress in relation to each

-self audit guide to good governance in local

government

The development of the Governance Health Check manual would not have been possible without the significant contribution of the following organisations and representatives:

• Project Management group

- Margie O’Tarpey, CEO, LGMA - Mitchell Morley, Chairperson LGMA Governance Special Interest Group - Yvonne Miles, ICAC - Grant Poulton and Linda Waugh, ICAC - Barry Davidow and Jeff Williams, Fraud Prevention Services

• The Local Government Managers Australia, (NSW) in particular LGMA Board and CEO, and the LGMA Governance Reference Group subcommittee - Craig Dalli , Fausto Sut, Jeff Knight, John Hilton, Les Windle and Trevor Rowling.

• The pilot councils, namely Warringah, Cabonne, Broken Hill, Shellharbour, Pristine Waters, Tweed and Canterbury.

• A number of consultation workshops were held, involving a broader local government stakeholder group, including the Department of Local Government, the Institute of Internal Auditors, NSW Ombudsman and the Local Government Association and Shires Associations. Their input and support is gratefully acknowledged.

• The support of Blacktown City Council who kindly assisted with formatting and printing the Governance Health Check.

• Finally, LGMA wishes to acknowledge the significant contribution of the consultant team who assisted in the writing and the research of the Governance Health Check, namely Barry Davidow and Jeff Williams from Fraud Prevention Services.

This publication is available in other formats for the vision impaired upon request. Please advise of format needed, for example large print or as an ASCII file. This publication is available on the LGMA website www.lgmansw.com.au and the ICAC website www.icac.nsw.gov.au

ISBN 1 920726 79 9

© June 2004 - Copyright in this work is held by the Local Government Managers Association (LGMA) NSW. Division 3 of the Commonwealth Copyright Act 1968 recognises that limited further use of this material can occur for the purposes of ‘fair dealing’, for example; study research or criticism etc. However if you wish to make use of this material other than as permitted by the Copyright Act 1968, please write to the LGMA at 51/2 O’Connell Street, Parramatta 2150.

This report and further information about the LGMA and ICAC can be found at their respective websites.

The New South Wales Local Government Governance Health Check (GHC) is the result of a joint project between Local Government Managers Australia (LGMA) and the Independent Commission Against Corruption (ICAC).

The GHC has been designed to give Councils a simple tool to identify key elements of corporate governance in a NSW local government context and to measure their progress in relation to each of these elements. It is accompanied by a Manual that provides a useful reference tool to assist Councils to better understand the elements of good corporate governance, find additional resources and identify best practice.

The LGMA and ICAC hope that the GHC will help individual councils identify specific governance issues that need attention and provide a basis for measuring progress and improvement over time. The GHC should also encourage the exchange of information on good governance practices between councils.

We strongly encourage local government staff, councillors and other stakeholders to use and make extensive use of this valuable tool to promote and facilitate best practice in corporate governance.

Irene MossICAC Commissioner

Cliff HaynesPresident LGMA

Governance Health Check - evaluation form 7Governance Health Check - worksheet 9Governance Health Check Action Plan 11About the Governance Health Check 13

1 Ethics and Values 171.1 Code of conduct 191.2 Internal reporting 231.3 Statement of adopted values 251.4 Statement of business ethics for external parties 271.5 Conflicts of interest 291.6 Gifts and benefits 331.7 Councillors’ access to information and interactions with staff 35

2 Risk Management and Internal Control 372.1 Risk management 392.2 Internal controls and audit 412.3 Fraud & corruption prevention plan 432.4 Process for legislative compliance 452.5 Privacy 472.6 Secondary employment 492.7 Payment of expenses and provision of facilities to councillors 512.8 Procurement and disposal procedures 53

3 Decision-making Processes 573.1 Code of meeting practice 593.2 Committee system 613.3 Involvement of stakeholders 633.4 Delegations of authority 653.5 Management plan 673.6 Policies and procedures 69

4 Monitoring and Review 714.1 Annual report 734.2 Performance management 754.3 Complaints handling 774.4 Registers 794.5 Access to documents 81

Topic RatingEthics and Values 0 1 2 3 4

1.1 Code of conduct1.2 Internal reporting1.3 Statement of adopted values1.4 Statement of business ethics for external parties1.5 Confl icts of interest1.6 Gift s and benefi ts1.7 Councillors’ access to information and interactions with staff

Risk Management and Internal Control 0 1 2 3 42.1 Risk management2.2 Internal controls and audit2.3 Fraud control plan2.4 Process for legislative compliance2.5 Privacy2.6 Secondary employment2.7 Payment of expenses and provision of facilities to Councillors2.8 Procurement and disposal procedures

Decision-making Processes 0 1 2 3 43.1 Code of meeting practice3.2 Committee system3.3 Involvement of stakeholders3.4 Delegations of authority3.5 Management plan3.6 Policies and procedures

Monitoring and Review 0 1 2 3 44.1 Annual report4.2 Performance management4.3 Complaints handling4.4 Registers4.5 Access to documents

Statement of business ethics for external parties

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A dramatic change has occurred in people’s expectations of public and private sector organisations. The collapse of major corporations as a result of poor governance practices and other events in recent years has created an expectation that organisations will prove that they abide by the principles of good governance, rather than just assert that they do.

Not only do people want corporations and the public sector to do the right thing, they want to see that the right thing is being done.

Internationally, good governance is seen as central to economic stability and development. Establishing and maintaining high standards of governance is crucial to to the effective operation of public and private organisations, and to gaining and retaining the public’s confi dence in these organisations..

Local government is generally subject to a high level of and it is crucial that Councils not only comply with the principles of good governance, but can demonstrate that they are doing so.

This Governance Health Check is a practical tool for Councils to assess their level of compliance with good governance principles and as an aid to help them achieve even higher levels of good governance.

Essentially, good governance means that the structures, activities, and operations of the organisation are conducted in accordance with the principles of legal compliance, probity, transparency, accountability, respect for people within the organisation and for other stakeholders. Sound ethical principles such as honesty, fairness, and respect should be followed at all times..

An essential component of good governance in local government is that all people involved in the direction and control of Council are aware of and comply with their roles and responsibilities. The Local Government Act 1993 provides some guidance on the roles of Councillors, the General Manager, the Mayor, and the Public Offi cer.

For there to be good governance in Council there has to be leadership and commitment. Councillors, the General Manager and senior managers should clearly demonstrate their commitment to good governance.

The Governance Health Check is divided into the following sections:

· Ethics and values

· Risk management and internal control

· Decision–making processes

· Monitoring and review.

Rating Levels of Achievement

0 Council has no system or policy in place in relation to this element or has a system which fails to meet basic legislative requirements.

1Council is able to demonstrate the existence of an informal system or policy that addresses this element or the existence of a basic formal policy or system which does not meet legislative requirements.

2 Council has a formal documented system or policy in relation to this element that at least meets a basic standard and all legislative requirements.

3Rating 2 plus there is evidence that the system or policy has been implemented and communicated to relevant stakeholders, with training and awareness programs, and is generally understood and adhered to.

4Rating 3 plus there is also evidence that the effectiveness of the system or policy is regularly measured and the system or policy reviewed on a regular basis. This level involves demonstrated continuous improvement.

This manual provides a useful reference tool to assist Councils to better understand each of the elements, find additional resources and identify best practice. The manual should be used as a guide only. It is not intended to be a definitive blueprint for each element.

To get full value from this Governance Health Check, senior management of Council must actively encourage an ongoing process of networking and benchmarking (comparing governance standards and practices) with other local government organisations and with any relevant government or non-government organisations.

Measuring Council’s governance standards

To maximise the benefits of the Governance Health Check it is recommended that Councils follow these simple instructions when completing the rating sheet:

1. Read the relevant section of the manual to familiarise yourself with the requirements of each element and in particular what constitutes better practice.

The Governance Health Check has been designed to give Councils a simple tool to identify key elements of corporate governance in a NSW local government context and to measure their progress in relation to each of these elements on a continuous improvement scale.

The following table should be used to rank Council against each item in the Governance Health Check.

2. Assess your Council’s status in relation to each element using the rating sheet and rating scale provided. In determining your rating you should consider what evidence you can show to justify your rating. For example, to achieve a rating of four there must be some evidence that the particular system, policy or procedure is properly reviewed – and if necessary improved – on a regular basis. Such evidence could include, for example, an annual report which is considered by the Council’s senior management team or by Council itself each year. Another example would be a regular survey which indicates people’s views on how effective the particular policy or procedure is.

3. Examine your overall ratings. Develop an action plan for those elements where your rating is low or where you would like to improve this area. Ratings of 0 or 1 would indicate that urgent attention is required. See sample action plan below.

4. Carry out the rating process on an annual basis and compare results from previous ratings

5. If appropriate, compare your results with other councils as a means of identifying those councils that have achieved better practice in particular elements. Check with other councils for examples of their codes and guidelines.

What is the NSW local government governance health check?

Ethics and values determine how people act. They determine whether people will act with honesty and integrity or dishonestly and corruptly.

Setting an appropriate standard of ethics is an important factor in establishing and enforcing a high ethical culture. Regulators, residents, ratepayers and other stakeholders expect people at Council to have a high ethical standard and are generally very critical if they believe that such a standard does not exist.

Setting and maintaining a high ethical standard in Council helps reduce fraud, corruption, maladministration and wastage. It helps ensure that Council has the respect of the community within which it operates and enhances the morale of people working at Council. It is one of the cornerstones of good corporate governance.

In this section we are examining the degree to which Council has established a standard of behavior in accordance with its values and communicated and followed that standard.

About the code of conduct

Councils are required by the Local Government Act to adopt a code of conduct.

The code of conduct sets the ethical standard for Council. The code’s primary purpose is to make clear to all people at Council what ethical conduct is expected of them; what is acceptable and what is unacceptable. The code assists communication and understanding of the ethical standards and allows them to be more easily enforced.

Where greater guidance on ethical issues is appropriate for Council staff or Councillors there should be supporting policies dealing with those issues. Generally there should be policies dealing with conflicts of interest, gifts and benefits, reporting procedures, and Councillors’ dealings with staff. It may also be appropriate to have policies on such matters as include disability discrimination, Councillor expenses, conferences, email and internet use, secondary employment, use of Council resources, privacy, and computer security and use.

The standards in policies should be realistic and relevant, bearing in mind the situations likely to be faced by people in your Council.

Why is the code of conduct important?

The code of Conduct sets the standard for behavior in the work place. It indicates what is acceptable and what is not. Without a code people apply their own judgements and a wide variation in conduct is often found, often including conduct that many people consider reprehensible.

The code helps people understand what Council’s expectations are in ethics issues. It provides a source of guidance when people are faced with ethical dilemmas or difficult situations. It also gives people the confidence to act in a certain way or insist that others act ethically.

Action

Examine your code of conduct, its accessibility, how it is promoted to people and how it is used, accepted and enforced by people and by Council.

Examine policies which expand on the provisions of the code of conduct, and ensure they are compatible with your code of conduct, other relevant policies, guidelines issued by relevant authorities, etc. Matters you should consider include the accessibility of the code and policies, levels of awareness and training provided, their integration into general Council practices and the results of any staff and Councillor surveys covering the code and policies.

Assess the level of compliance by examining related registers and any requests and other documentation required by the policies.

Achieving better practice

1. Draft a code of conduct that is clear, useful and easily understood by the intended readers.

2. Ensure that the content of the code complies with any legislative requirements and/or directions from the Department of Local Government regarding model codes of conduct.

3. Ensure that the code covers the key ethical issues that people are likely to be faced with. These typically include conflicts of interest, gifts and benefits, use of resources, confidentiality of information, privacy, interactions between Councillors and staff, and reporting corruption.

4. Ensure that the code states and reflects the values of Council.

5. Ensure that representative staff and Councillors are involved in the drafting of the code and subsequent reviews of it. It is important for people to have a sense of ownership of the code.

6. All Councillors and staff should be given the opportunity to comment on the draft code.

7. Ensure that the code represents your Council. You may use other codes or models as a guide, but it is important that it is your Council’s code. The standards set should be appropriate for your Council.

8. Ensure that the code is endorsed by the General Manager.

9. The standards should be clear and the tone should be appropriate to encourage compliance and ownership. The code should note that breaches will be dealt with and should specify what sanctions may be applied.

10. The code should be formally approved by Council.

11. Review the code regularly, at least every two years and in accordance with the Local Government Act. The review should ensure that the code contains all relevant issues and particularly new laws and changes in the compliance environment insofar as they affect ethical conduct. The review should consider how the code can be improved to better reflect the real–life situations faced by staff and Councillors. The review should involve representative staff and Councillors.

12. Advise the community in Council publications that Council has a code of conduct, which is available in hard copy as well as on the Council website.

13. The code should be integrated into Council’s regular activities, including development of position descriptions and project plans, regular planning, and so on.

14. The effectiveness of the code should be assessed periodically. Staff and Councillor surveys and other appropriate methods should be used. Evidence of the level of compliance should be assessed through other appropriate means, such as exit interviews and performance reviews. Areas for potential improvement should be identified and noted for when the code is next reviewed.


15. There should be reporting to stakeholders on the operation of the code against pre-determined performance indicators.

16. Where the code deals with matters that require more detailed explanation and guidance, these should be contained in separate policies. The policies should be compatible with the code and the code should have references to the appropriate policies. These may include, but not be limited to, policies on: ethics, conflicts of interest, gifts and benefits, use of Council resources, secondary employment, internal reporting, Councillors’ interactions with staff, confidentiality of information, protection of information, privacy, Equal Employment Opportunity, breaches and sanctions, and internet and email use.

17. Review the policies periodically, at least every two years, and ideally in conjunction with the code of conduct. Ensure that the policies reflect the issues and circumstances that people are faced with, and that the policies reflect the ethical aspirations of people at Council.

18. The policies should note that breaches will be dealt with and what sanctions may be applied.

19. The policies should be easily accessible to all staff.

20. Guidance should be given to managers making decisions as a result of the policies, for example what to do if a person has told them of a possible conflict of interest.

21. There could be an Ethics Committee or similar appropriate body to consider changes to and updating of policies. Such committee could consist of a Councillor representative, management and staff representatives and possibly an independent (outside) representative.

22. Include in your code or associated policies the name of the person in the council that staff can consult on ethical issues.

23. Staff and Councillors should receive induction training and regular appropriate training in the code . People should receive training at least every three years. Ensure that the courses are delivered by people with adequate training skills and sufficient knowledge of the ethics issues and developments in the field, e.g. knowledge of relevant ICAC reports, recommendations and advisory publications.

24. Other methods should be used to ensure that awareness of the code remains high. These could include discussions, items in publications, etc.

25. Keep a record of people attending training courses to ensure that every person receives appropriate training. Ensure that the training courses are given sufficiently often so that, for example, new starters do not have to wait too long to receive training.


26. Review findings and judgements of Council’s cases that have been heard by industrial relations and administrative tribunals and examine registers, surveys, exit interviews, investigation reports and results, reports from relevant authorities and agencies, and other relevant information to ensure that your training and awareness is covering the issues which people are likely to face.

27. Establish and document the processes for investigating breaches of the code of conduct and related policies and disciplinary actions or other sanctions. Ensure that the processes comply with industrial relations requirements, sound administrative practice, and fairness.

28. Ensure that investigations and disciplinary or other actions take place in accordance with the written procedures and take into account procedural fairness.

29. Review staff and Councillor surveys, exit interviews and other feedback provided to assess whether people consider the processes to be fair, and how they can be improved.

30. Review the processes periodically, at least every three years, and make appropriate improvements.

Module 3 of Practical Guide to Corruption Prevention, ICAC (June 1997)

Ethical Culture Survey Kit , ICAC, September 2000

Codes of Conduct: The next stage, ICAC, March 2002

ICAC gifts and benefits publication (to be released 2004)

Fact Finder: A 20-step guide to conducting an inquiry in your organization, ICAC May 2003

Australian Standard AS 8002-2003 Australian standard Organizational Codes of Conduct, Standards Australia 2003

Model Code of Conduct, Department of Local Government

Model Code of Conduct for NSW public agencies, NSW Premier’s Department

Code of Conduct and ethics for Public Sector executives, NSW Premier’s Department

Good Conduct and Administrative Practice – Guidelines for State and Local Government, Ombudsman’s Office August 2003


Resources

About Reporting

To comply with the disclosure provisions of the Protected Disclosures Act 1994 Council should have in place an internal reporting policy which describes the process to be followed in making protected disclosures. Such a policy is also recommended by the NSW Ombudsman and the Australian Standard on Corporate Governance.

Why is internal reporting important?

The Protected Disclosures Act provides for avenues for public officials to make protected disclosures (reports of corruption, maladministration or serious and substantial waste). However, in the absence of an appropriate internal reporting procedure, only disclosures made to an investigating authority, to the principal officer of an authority, or in limited circumstances, to a Member of Parliament or journalist, are protected.

A public sector organisation, including a council, which has an appropriate and effective internal reporting system is able to acknowledge and act upon reports of corruption, maladministration and serious and substantial waste in terms of the Protected Disclosures Act.

Prompt, sensitive and appropriate resolution of all employee grievances is sound management practice. Another important aim of introducing an internal reporting system is to encourage employees to provide useful information to management and to ensure the organisation responds by correcting identified problems.

Matters of suspected corruption involving or affecting a public sector organisation, must be reported to the Independent Commission Against Corruption, pursuant to section 11 of the Independent Commission Against Corruption Act. An effective internal reporting policy will assist in this regard.

Action

Review the reporting policy and procedures.


1. Have a formal internal reporting policy. People should be given a number of options for internal reports. Generally this would include the General Manager, their supervisor or manager and a designated senior manager (Disclosures Coordinator). All supervisors or managers receiving reports should pass them on to the designated senior manager (Disclosures Coordinator). The policy should point out people’s right to report directly to ICAC, the Ombudsman or the Department of Local Government.

2. The policy should make it as easy as practical for people to make reports.

3. The policy should deal with confidentiality, sanctions against taking detrimental action against people making reports, and the other matters dealt with in the Ombudsman’s guidelines.

4. Distribute the reporting policy to all staff and Councillors. Inform volunteers and other people working closely with Council of reporting procedures. Inform members of the public where to make reports, eg. including a number in relevant Council publications. Councillors, staff, and other appropriate people should receive training in the reporting policy and procedures.

5. The system should take into account reports from members of the public and other third parties are identified and receive appropriate attention. The reports should be separated from complaints and requests for action.

6. A person making a report should be thanked for the report and informed about the outcomes of the report.

7. Ensure that all reports result in appropriate assessment and, if necessary, investigation and there are no ‘cover-ups’. Ensure all allegations of detrimental action in reprisal for the making of a report are investigated.

8. Actively cultivate a culture to encourage people to make reports and protect those who have made reports.

9. Review the policy periodically, at least every two years.

10. Regularly review the reports received, examine surveys, (of staff, Councillors, the public, etc.) exit interviews and other relevant sources of information to identify trends, areas of reporting and non-reporting, etc.

11. Council must report suspected corruption to ICAC when it becomes aware of the suspected corruption. You should not wait until an investigation has been completed. The easiest way to ensure that you satisfy the legislative requirement to report all suspected corruption to ICAC is to include all allegations received.

Protected Disclosure Guidelines – 4th Edition, NSW Ombudsman January 2002

Australian Standard AS 8004-2003 Whistleblower Protection Programs for Entities, Standards Australia 2003

Independent Commission Against Corruption Act 1988, section 11

Protected Disclosures Act 1994


Resources

About adopted values

Values may be considered as the ethical principles that we consider important. They guide how we act and what we aspire to. The values adopted by a council are an important unifying force and a valuable means of encouraging staff and Councillors to act appropriately towards the people they interact with in their work. The adopted values shape the culture of Council. The stated values should be aspirational, shared and reflect the things that are important to Council.

Why are adopted values important?

People in an organization should act in accordance with the values of their organization. If the organization does not have a clear set of values the result is often people acting under values at odds with Council’s values. Unethical conduct is far more likely to occur in these situations. Where values have been adopted it is critical that the organisation, particularly senior staff and Councillors, give effect and adhere to them. Failure to do so will promote cynicism, disunity and a lack of purpose.

Action

Examine documents dealing with the statement of values, documents containing the values, the processes of formulating and reviewing the values, staff and Councillor surveys, public and other stakeholder surveys, complaints and compliments received from third parties, performance reviews, exit interviews, etc.


1. Have staff and Councillor representatives participate in the development of your values. It is critical that the values adopted really do represent the aspirations and values that people hold to be important for Council.

2. Ensure that there is a general approval of the values by the rest of staff and Councillors. This is best done through discussions, but can also be done by circulating a draft and encouraging people to give their suggestions and comments.

3. Incorporate the values into your code of conduct and other appropriate documents, including position descriptions.

4. State Council’s values clearly in your management plan.

5. Include Council’s values as a topic in training and awareness activities for staff, Councillors, and other appropriate people at Council.

6. Inform your stakeholders of Council’s values.

7. Ensure that compliance with the values is built into Council’s processes and activities.

8. Review Council’s values periodically, at least every two years.

9. Review surveys, complaints and compliments received from stakeholders, performance assessments, reports through internal grievance and complaints handling processes, allegations of suspected corruption, etc. to see to what degree the values are being translated into everyday actions and where improvements should be made.

10. An Ethics Committee or similar appropriate body may be useful to oversee the statement of values.

Principles of Administrative Good Conduct, NSW Ombudsman 1997

Practical Guide to Corruption Prevention, ICAC June 1997

The First Four Steps, ICAC, April 2001


Resources


Examine your statements of business ethics or similar statement, tendering and contracting processes, customer complaints and compliments, survey results, contractor performance assessments, etc.

Action

External parties should comply with appropriate standards of ethics in their dealings with Council and with other people when they are seen as representing Council representatives.

Codes of conduct for external parties or statements of business ethics are useful to help ensure that external parties act ethically.

Why are statements of business ethics important?

Statements of business ethics are used as a method of setting the standard that third parties are expected to apply when dealing with Council or acting on Council’s behalf. The statement may contain similar headings to your code of conduct. It is important to ensure that the statement is relevant, contains all the important issues and is clear and easy to understand. You can have different statements for different categories of third parties,e.g. one for volunteers and another for suppliers or contractors.

About statements of business ethics

1. Consider the significant ethical issues for third parties that affect Council. The issues may include bribes, gifts and benefits, conflicts of interest, privacy, confidentiality of information, use of resources, reporting of corrupt or other inappropriate conduct, treatment of the public, and so on.

2. Draft a statement of business ethics for external parties. Often the statement will deal with (1) how external parties and their staff interact with Council and people at Council, and (2) how external parties and their staff interact with the public and others who might be under the impression that the external parties and their staff are representatives of Council.

3. Compare your statement with those of other Councils and organisations.

4. Distribute the statement to all relevant third parties.

5. Consider amending standard contracts, letters of appointment, and other appropriate documents to provide that relevant third parties are legally bound to comply with the statement. Such provisions need to be supported by clear and sound contractual conditions and it is advisable to obtain legal advice on the pros and cons of using a statement of business ethics as part of a contractual arrangement.

6. Consider amending your tender documents to include an obligation for the contractor to comply with the statement.

7. Contractors and consultants should be required to ensure that their relevant staff are given a copy of the code or statement of business ethics and are responsible to comply with it.

8. The assessment of performance of contractors, suppliers and other external parties should include assessing how well they have complied with the requirements of the code or statement of business ethics. It may also include assessing how well they have educated their own staff in the code or statement.

9. Set up a process for dealing with breaches of the statement.

10. Review surveys, complaints and other feedback to assess the level of compliance and areas for improvement.



Managing Risk: Reducing Corruption Risks In Local Government, ICAC, 2001

Guideline for developing a statement of business ethics, ICAC, June 2004

ICAC local government strategy resources (available on ICAC website www.icac.nsw.gov.au):

Taking the Devil out of Development Taking the Con out of Contracting No Excuse for Misuse Taking the Whiff out of Waste

Resources


Examine the provisions of the code of conduct, related policies and other guidelines dealing with conflicts of interest. Examine the conflicts of interest and pecuniary interests register, declarations of conflicts as well as the instructions on how to handle those conflicts. Examine complaints and allegations relating to conflicts of interest.

Action

Conflicts of interest probably cause more problems in Local Government than any other ethical issues. Most of the allegations of corruption in Local Government sent to ICAC arise from issues of conflicts of interests. The manner in which conflicts of interest are dealt with by a council can be the single biggest influence on the public’s perception of the level of honesty and integrity which exists within the organisation. It is therefore important to establish standards and processes to deal with conflict to protect both the individuals concerned and Council. Failure to establish appropriate processes for identifying and dealing with conflicts of interest may result in decisions being made for private gain rather than public benefit and expose the Council to corrupt conduct.

Why are conflicts of interest important?

A conflict of interest arises if it is likely that a private interest could conflict, or be seen to conflict, with the performance of a public or professional duty. Conflicts of interest may arise from a number of sources, including friends, relatives, close associates, financial investments, past employment, future employment, etc. It is not only important to ensure that real or potential conflicts are handled appropriately, but also that perceived conflicts of interest are correctly handled.

When assessing conflict of interest situations it is preferable to err on the side of caution, especially when one considers the number of allegations made in this area. It is critical that Council has effective systems in place to help ensure that conflicts of interest are identified and that they are managed following the principles of probity and transparency.

Organisational conflicts may arise where Council itself has or may be perceived as having a conflict of interest. An example is where Council is selling a piece of land and also considering changing its zoning status. For the community to have confidence in Council it is important that Council is seen as doing the right thing in resolving its conflict of interest.

About conflicts of interest

1. Ensure that conflicts of interest are dealt with in the code of conduct.

2. In addition, develop a separate policy and procedure for dealing with conflicts of interest.

3. Consider whether Council’s requirements regarding conflicts of interest are practical and meet the required standards of probity. For example declaring a conflict of interest does not mean that no further action is required, and it may be appropriate that the person is no longer involved in the decision. Another example is that the requirements should not only cover those making decisions, but also those providing advice or information to be used in decision-making.

4. Consider whether the requirements are comprehensive, dealing with all of the situations that people are likely to be faced with. For example the conflict of interest policy should cover offers of future employment and past employment in the course of people’s duties.

5. Generally if a person has an actual or perceived conflict of interest (where there are reasonable grounds for that perception), he or she should no longer be involved with that matter or transaction. In addition to not being involved in the direct decision-making process, the person should not inappropriately lobby on the side, should not question staff about the matter, or take any other actions that could be seen as indirectly influencing the decision. Legally, a Councillor can lobby as a resident where he or she has an interest as a resident.

6. Consider whether other Council policies and procedures adequately deal with conflicts of interest, for example procurement, disposals, secondary employment, etc.

7. Ensure that all appropriate people are covered by the provisions, for example volunteers and other people not covered by your code of conduct who are involved in Council’s advisory or decision-making processes or who are seen to be representatives of Council.

8. Maintain a register of all conflicts of interest. The register should be maintained appropriately, should preserve people’s privacy insofar as the legislation allows, should allow people to make entries easily, should be reviewed regularly, etc.

9. Meetings procedures should deal with conflicts of interests, for example to ensure that conflict of interest declarations are recorded in minutes.

10. Ensure that there are adequate training and awareness activities regarding conflicts of interests.

11. Ensure that there are procedures to ensure that organizational conflicts are identified and managed appropriately, following the principles of transparency and probity.

12. Contractors, major suppliers and others should have to ensure that their conflicts of interest regarding Council are declared and dealt with appropriately and that they do not act inappropriately by exposing people at Council to conflicts of interests outside of the guidelines.

13. Get feedback from people regarding the provisions, their application and related issues and use this to enhance your policies and processes.

14. Ensure suspicions and allegations of breaches are properly investigated and dealt with.

15. Encourage a culture of compliance with the principles of transparency and probity regarding conflicts of interest.


Resources

Good Conduct and Administrative Practice – Guidelines for State and Local Government, Ombudsman’s Offi ce, August 2003

Fact Sheet No. 3 - Confl icts of Interest, NSW Ombudsman, July 2003

Practical Guide to Corruption Prevention, ICAC, June 1997

In Whose Best Interest – video and facilitation guide on councillors and confl icts of interest, ICAC



Use the table to assess how you deal with gifts and benefits. Examine your code of conduct, gifts policy, guidelines, register, etc.

Action

Offers of hospitality, gifts and benefits may be made out of appreciation or in order to place the person receiving the offer, gift or benefit under an obligation. People observing Council staff or Councillors accepting gifts or benefits may jump to the conclusion that what is being given is really a bribe or an attempt to inappropriately influence a Council process or decision. People giving the gifts may feel that they are entitled to special treatment as a result.

Why are gifts and benefits guidelines important?

It is inevitable that staff and Councillors will from time to time be offered gifts and benefits. Council needs to set a standard of what is and is not acceptable, what permissions should be obtained and what procedures should be followed. It is recommended that registers be used where non-token gifts are accepted.

About gifts and Benefits

1. Ensure that Gifts and Benefits are covered in the code of conduct.

2. Consider whether Council’s requirements regarding gifts and benefits are practical. For example, saying that no gifts, benefits or hospitality of any kind may be accepted is generally impractical. If Council permits gifts of token value to be accepted, then token value must be clearly defined, with appropriate examples.

3. Consider whether Council’s requirements meet the required standards of probity.

4. Consider whether the requirements are comprehensive, dealing with all of the situations that people are likely to be faced with.

5. Ensure that all appropriate people are covered by the provisions, for example volunteers and other people not covered by your code of conduct who are involved in Council’s advisory or decision-making processes or who are seen to be representatives of Council.

6. The provisions should state what gifts and benefits cannot be accepted, what can be accepted and in what circumstance, what permission is needed and what documentation must be completed.

7. If gifts and benefits are permitted, maintain a register of gifts and benefits declared by staff and Councillors. The register should be maintained appropriately, should preserve people’s privacy insofar as the legislation allows, should allow people to make entries easily and should be reviewed regularly. Consider whether the register should be publicly available.

8. Ensure that there are adequate training and awareness activities regarding gifts and benefits.

9. Ensure that there is provision for reporting offers of gifts and benefits that are not accepted.

10. Get feedback from people regarding the provisions, their application and related issues and use this to enhance your policies and processes.

11. Ensure suspicions and allegations of breaches are properly investigated and dealt with.

12. Encourage a culture of compliance with the principles of transparency and probity regarding gifts and benefi ts.

13. Use data from your gifts and benefi ts register to identify and analyse any trends or issues in relation to gifts and benefi ts e.g. Are there particular people giving a large number of gifts to Council staff? Act on any issues identifi ed which require remedial action.


Good Conduct and Administrative Practice – Guidelines for State and Local Government, Ombudsman’s Offi ce , August 2003

Model Code of Conduct, Department of Local Government (Date to come)


Under Careful Consideration: Key Issues for Local Government, ICAC, March 1997

ICAC gifts and benefi ts publication (forthcoming in 2004).

Resources


Examine the policy and records of and from the process, obtain feedback from relevant staff and Councillors.

Action

Having a formal policy and process for Councillors access to information and interactions with staff will help prevent a wide range of complications from arising such as staff feeling inappropriately pressured by Councillors, Councillors feeling that they are being inappropriately lobbied by staff, and Councillors being given incomplete information. A formal policy and process will help ensure that probity requirements are met and disputes or complaints reduced.

Why is it important?

Councillors have a right to council information that is necessary for exercising their functions as Councillors.

Councillors and staff should not take advantage of their position to access information which they do not need for their council work. They should not take advantage of their position to inappropriately influence staff or Councillors for the benefit of themselves or others.

Councillors, as private individuals, also have a right to access any documents a normal resident would have a right to access either under section 12 of the Local Government Act 1993; the Freedom of Information Act 1989 or any other act or regulation which may provide a right of access to council documents. Access on this basis would need to ensure that councillors undertook the same process as would be required of any other person and that no special advantage or priority was granted due to their position as a Councillor.

A model policy is provided in the ICAC publication, Under Careful Consideration: Key Issues for Local Government. Ensure that the policy that you adopt is relevant for your Council. If the model is used, appropriate changes should be made.

About Councillors’ access to information and interactions with staff

1. In drafting the policy hold discussions with representative staff and councillors to identify issues for consideration and appropriate processes. It is suggested that the model in the ICAC publication should be referred to.

2. Councillors’ access to staff should be through the General Manager or other appropriate senior managers chosen by the General Manager. Councillors should not approach staff in a way that could lead to staff gaining the impression that Councillors are attempting to influence their decisions. The policy should identify who Councillors are authorised to speak to directly.

3. Councillors should avoid unnecessary criticism of staff in public.

4. Link the Policy into Council’s code of conduct.

5. In developing the policy, identify and address issues specific to Council.

6. Ensure that the policy adopted is distributed to all staff and Councillors and included in relevant training.

7. Establish a reporting system for people to report breaches of the policy.

8. Investigate all reported or suspected breaches and take appropriate action.

9. Where appropriate inform the community of actions taken, for example in Council minutes and the annual report.

10. Periodically seek feedback from relevant people on the operation of the policy and process.

11. Monitor and review the process and policy and make the appropriate enhancements.


Under Careful Consideration: Key Issues for Local Government, ICAC March 1997

In Whose Best Interest – video and facilitation guide on councillors and confl icts of interest, ICAC, 2004

Resources

In order to achieve its objectives and operate effectively and in accordance with sound governance principles Council needs to be aware of key risks that it faces and needs to have appropriate controls in place to deal with those risks.

If Council is not aware of all the signifi cant risks that it faces, there is a concern that there will be threats to which Council remains exposed. There are key internal control systems and processes that help Council to protect itself against threats, and it is important that these systems and processes operate effectively.

This section considers the degree to which Council has identifi ed, analysed, evaluated and treated risks and the effectiveness of its controls and processes.

Risk management should be used to enhance the management of Council. Councils are faced with a range of risks that could affect their ability to achieve Council objectives. Risk management helps ensure that people are aware of the risks and that they take appropriate actions to reduce the risks to acceptable levels.

The risks could be financial or non-financial. Non-financial risks could include risks of damage to the reputation of Council and individuals associated with Council, risks of adverse media attention, risks of lawsuits or prosecutions, and so on. The risks could arise as a result of environmental, legislative, regulatory, political, technological or other factors.

When identifying risks as part of the risk management process it is important to consider the inherent risks, in other words the risks that exist, independent of the controls that you might have in place to prevent or reduce those risks.

When analysing risks you should consider the likelihood of a risk occurring and the consequences for Council if it does occur.

As Council’s circumstances and environment change, the risks faced by Council change. It is therefore important that the risk management process identifies changes in the risk environment and ensures that the controls are adequate for those risks.

The internal controls system and the internal audit activities should take account of the risk management processes and activities.


Examine your risk management activities, strategies and framework and the level of acceptance of risk management by people at Council. The risk management process includes business continuity risks and plans.

Action

Councils are exposed to a wide range of risks. If Council is not aware of some risks or has not adequately assessed those risks, Council could suffer substantial financial losses, public or staff safety could be threatened or Council could be subjected to substantial adverse publicity. It is therefore critical that the risks that Council faces are effectively managed.

The risks should be managed through a formal process detailed in the Australian Standard on Risk Management (AS/NZS 4360:1999).

Why is risk management important?

About risk management

1. Establish the risk management context and identify, analyse, evaluate and treat the risks. Use categories of risks that are appropriate for your Council. These might include financial risks, environmental risks, health and safety risks, corruption risks, and political risks.

2. Ensure that risk assessments consider likelihood and consequence of risks.

3. Senior management should be made aware of high residual risks (risks which are high even with the controls and measures that are in place to mitigate those risks).

4. Council should have a formal risk management policy.

5. Ensure that risk management includes business continuity risks and planning.

6. Responsibilities and authorities for risk management should be clearly defi ned.

7. Assess the performance of the risk management system and enhance it as appropriate.

8. Communicate and consult with people at Council and with stakeholders to ensure that the system is operating effectively.

9. Train people who will be involved in risk management in how to undertake risk assessments, how to operate controls and how to manage risks.

10. Encourage a culture of proper risk management in Council.

11. Integrate risk management into the day-to-day activities and processes of Council.

12. The risk management process should ensure that risks and their mitigation are regularly considered so that Council remains adequately protected.


Australian / New Zealand Standard AS/NZS 4360:1999 Risk Management, Standards Australia, 1999.

Risk Management and Internal Control, NSW Treasury, September 1997.

Guidelines for managing risk in the Australian and New Zealand Public Sector, Standards Australia, 1999.

Good Conduct and Administrative Practice – Guidelines for State and Local Government – Chapter 9, NSW Ombudsman, August 2003.

Resources

Internal control has been defined as a process designed to provide reasonable assurance regarding the achievement of the organisation’s objectives, particularly the effectiveness and efficiency of operations, the reliability of internal and external reporting and compliance with applicable laws, regulations and internal policies.

Internal controls include a broad range of measures including culture, management style, supervision, segregation of duties, rotation of duties, access controls, IT controls, checking, training, reviewing information and figures, physical security, policies, guidelines, reasonableness checks and reviews, etc.

In a system of internal controls it is important that people:

· understand what are the objectives that they need to achieve;

· are given the resources, time, information and skills that they need in order to achieve those objectives;

· are motivated to achieve the objectives; and

· monitor their performance and the environment to learn how to do the tasks better and make appropriate changes.

Internal controls should ensure that the risks faced by Council are reduced to an acceptable level. Therefore internal controls are concentrated in those areas of greatest risk. Formal risk assessments should be undertaken to ensure that internal controls are adequate to reduce the risks to an acceptable level.

Internal audit is the process of reviewing internal controls to ensure that they are operating as designed and that they are effective in protecting Council and helping it achieve its objectives.

Council’s activities, especially the key and high-risk activities should be subject to internal audit and review. The audit and review activities should be undertaken by people with the appropriate skills and expertise. Internal audits and reviews should provide independent, objective assurance to Council and management.

For Council to be able to rely on information provided by internal audits it is important that the internal auditor should be free of attempts to unduly influence his or her report. It is therefore important that the internal audit function should report directly to the General Manager or an audit committee.

If risks cannot be eliminated it is important that internal control measures are in place to reduce the likelihood of something going wrong. In the absence of appropriate internal controls Council will be exposed to a variety of risks that may impact negatively on Council’s ability to achieve its objectives.

Why are internal controls and audit important?

About internal controls and internal audit

It is important for Councils to have in place a system of internal audits to verify the existence and effectiveness of internal controls and whether they are assisting Council to meet its objectives. In the absence of internal audits weaknesses in internal controls may not be detected and opportunities for improved performance may be missed.

Why are internal controls and audit important?

1. Carry out a risk assessment, considering all the significant risks that Council faces.

2. Where no controls are in place to reduce those risks to acceptable levels, introduce appropriate internal controls.

3. Where controls are in place examine the controls to ensure that they are effective in reducing the risk to acceptable levels.

4. Ensure that staff have adequate training, resources, time, etc. to carry out the controls properly.

5. Regularly review the risks and associated controls as part of your risk management strategy.

6. Conduct audits or reviews of the controls to ensure that they are operating effectively.

7. Ensure that the audit function reports to the General Manager or an Audit Committee.

8. Ensure that there is a culture of compliance with internal controls.


Guidance on Control, Canadian Institute of Chartered Accountants Criteria of Control Board, 1995.

Internal Control – Integrated Framework, COSO, 1992.

Risk Management and Internal Control, NSW Treasury, September 1997.

Australian Standard AS 8001:2003 Fraud and Corruption Control, Standards Australia, 2003.

Audit Committees Best Practice Guide, Institute of Internal Auditors, AARF, AICD.

A Guide to the use of AS/NZS 4360 Risk Management within the internal audit process, Standards Australia and the Institute of Internal Auditors.

Standards for the Professional Practice of Internal Auditing, Institute of Internal Auditors.

Resources

Examine the internal audit and control processes, reports and activities. Examine the results of the risk assessments to see if their internal controls are adequate.

Action

The Australian Standard indicates that there are three parts to effectively controlling the risks of fraud and corruption:

· Structural elements

· Operational elements

· Maintenance elements

The structural elements are a sound ethical culture, senior management commitment, periodic assessments of fraud and corruption risks, management and staff awareness, and fraud and corruption control planning.

The operational elements are internal controls, fraud detection programs, mechanisms for reporting suspicions of fraud or corruption, dealing with detected or suspected fraud or corruption, line management accountability for the control of fraud and corruption risks, internal audit strategy, policy for the protection of whistleblowers, allocation of resources to control fraud and corruption risks, insurance, and pre-employment screening.

The maintenance elements include review of the effectiveness of the fraud and corruption control strategies, ongoing monitoring of the ethical culture, and review and adjustment of the fraud and corruption control plan.

The public and other stakeholders have an expectation that organizations, especially public sector organizations, will take appropriate measures to reduce fraud and corruption against the organization. Fraud and corruption are a drain on Council’s resources and can severely damage its reputation. Having a fraud and corruption control plan will help address the risks.

Why are fraud & corruption prevention plans important?

About corruption prevention plans

Consider the measures you have in place to manage fraud risks. Consider also customer surveys, staff and Councillor surveys, external and internal complaints received, allegations made, media reports, evidence of perceptions, indicators of staff understanding, etc.

Action

1. Have a fraud and corruption prevention plan that deals with the threats of fraud and corruption. The documented fraud and corruption prevention plan should comply with the guidelines issued by the Audit Office of New South Wales and the Premier’s Department. The plan should be comprehensive and strategic.

2. The fraud and corruption prevention plan should be reviewed at least every two years and changes made to ensure it is current and to enhance its effectiveness.

3. Responsibility for ensuring the effective implementation and operation of the fraud and corruption prevention plan should be assigned.


4. Accountabilities for fraud and corruption control should be clear and incorporated into Council’s regular activities and processes.

5. There should be periodic assessments of fraud and corruption risks, at least every two years. This can be undertaken as a separate exercise or as part of Council’s enterprise risk management process.

6. Staff should be made aware of fraud and corruption issues, including their prevention and detection. This should be part of training as well as a process for letting people know of new reports or developments in the fi eld. Councillors should be informed of relevant fraud and corruption issues.

7. Work through the guidelines issued by the Audit Offi ce of New South Wales and the Premier’s Department and ensure that each of the elements is implemented.

8. Work through the Australian Standard on fraud and corruption control and ensure that each element is implemented. Most of the items in the Australian Standard are in the guidelines issued by the Audit Offi ce of New South Wales and the Premier’s Department, but there are some additional items.


Fraud Control, Developing an Eff ective Strategy, NSW Audit Offi ce and Offi ce of Public Management, NSW Premier’s Department Volumes 1-3 (1994) Volume 4 (1998)

Australian Standard AS 8001-2003 Fraud and Corruption Control, Standards Australia, 2003

Fighting Fraud: guidelines for state and local government, ICAC, November 2002


No Excuse for Misuse, ICAC, 2003

Resources

Council should have appropriate processes and structures to ensure that legislative requirements are complied with. These should be integrated into the everyday running of Council.

If offences are committed by Council or people at Council as a result of legislation not being complied with, Council, staff and Councillors could be prosecuted, Council could be sued and there could be a significant loss of reputation. Regulators, stakeholders and people working at Council have a high expectation that Council will comply with applicable legislation, and Council should take all appropriate measures to ensure that that expectation is met.

Why is legislative compliance important?

About legislative compliance

Assess your legislative compliance systems and processes.

Action

1. Develop and maintain a system for identifying the legislation that applies to Council’s activities.

2. Assign responsibilities for ensuring that legislation and regulatory obligations are fully implemented in Council.

3. Review relevant systems and procedures to ensure that they comply with the legislation.

4. Provide training for relevant staff, Councillors, volunteers, and other relevant people in the legislative requirements that affects them.

5. Provide people with the resources to remain up–to–date with changes to the requirements and a mechanism for identifying new legislation.

6. Ensure that people have sufficient resources to meet legislative and regulatory requirements.

7. Establish a mechanism for reporting non-compliance.

8. Establish a system to ensure that all instances of non-compliance are investigated and appropriate action taken.

9. Conduct audits to ensure that there is compliance.

10. Review accidents, incidents and other situations where there may have been non-compliance.

11. Review audit reports, incident reports, complaints and other information to assess how the systems of compliance can be improved.

12. Ensure that there is a culture of compliance.


Good Conduct and Administrative Practice – Guidelines for State and Local Government – Chapter 1, NSW Ombudsman, August 2003

Resources

Privacy legislation covers personal information – information or an opinion about an individual whose identity is apparent or can reasonably be ascertained from the information or opinion.

The Privacy and Personal Information Protection Act 1998 applies to Councils in NSW. It is supplemented by the Privacy Code of Practice for Local Government. The Model Management Plan for Local Government explains many of the operations of the Act and Code.

Individuals have a right to have their personal information protected, and in NSW that right is enshrined in legislation. Council has a duty to protect the privacy rights of individuals and can be required to pay compensation if it fails in that duty. Failure to protect people’s privacy is also likely to result in negative publicity and loss of reputation.

Why is privacy important?

About privacy

Examine the privacy management plan, forms used for collecting personal information, processes for protecting and disclosing personal information, the operation of public registers containing personal information, requests for personal information under the privacy and other legislation, other indicators of the effectiveness of implementation of the legislation, the results of surveys, complaints received, etc.

Action

1. Formally adopt a privacy management plan.

2. Appoint a privacy contact officer with responsibility for ensuring that Council has implemented appropriate procedures to comply with the requirements of the privacy legislation and the Privacy Code of Practice for Local Government.

3. Staff and Councillors should receive training in privacy matters and how to comply with the privacy legislation and code of practice. Volunteers and others collecting, accessing, handling or disclosing personal information should also receive training.

4. Contracts with outside entities and people should contain the appropriate privacy provisions to ensure that they will comply with the privacy legislation.

5. All forms used to collect personal information should have the appropriate notifications. The notifications should give all of the required information, not only part of it. Ensure that the notification complies with the requirements of the NSW legislation, not the Commonwealth legislation.


6. Ensure that other measures have been taken to protect people’s privacy. These might include not collecting sensitive personal information where other people can overhear it, and telling people of their rights when collecting personal information in ways other than using forms.

7. Inform providers of personal information of their rights and what Council’s policies and procedures are. This could be done by pamphlets, the website and other appropriate media. A question–and–answer publication for staff and the public that addresses the most common enquiries made to your Council could be useful.

8. Periodically review Council’s policies, processes and practices for collecting, handling and disclosing personal information and make appropriate improvements. In particular review the Privacy Management Plan at least every two years.


Privacy and Personal Information Protection Act 1998

Privacy Code of Practice for Local Government

Model Privacy Management Plan for Local Government

Resources

Secondary employment occurs when an employee of Council is also engaged, for remuneration, in private employment or contract work outside the service of the Council. The Local Government Act contains specific provisions relating to secondary employment by staff which must be adhered to. To enable these provisions to be followed Councils should have in place appropriate systems for obtaining and recording approval for staff to engage in secondary employment.

A related issue is the use by former employees of Council’s intellectual property when they leave Council’s employment. Requirements regarding former staff using Council information, resources and intellectual property once they cease employment must be clearly spelt out to all staff.

People who seek secondary employment often get jobs in areas in which they have experience and expertise. The result is often people being exposed to conflicts of interest because they are working in sectors that they regulate or about which they make decisions. It is important from both a probity and public perception point of view to ensure that a person’s secondary employment does not result in such conflicts.

Secondary employment should be controlled to ensure that staff are not in conflict of interest situations because of their proposed secondary employment or business. This is also relevant to help ensure that personal information, Council assets and confidential information are not misused for the purposes of the secondary employment or business.

Why is secondary employment important?

About secondary employment

Examine your code of conduct, policy on conflicts of interest, other provisions relating to secondary employment, applications for permission or notifications of secondary employment, complaints, reports from managers and supervisors, internal audit reports, etc. Assess awareness and compliance with the provisions using the table.

Action

1. Ensure your requirements comply with the Local Government Act.

2. Provide information and training to staff on the requirements of the Act.

3. Make supervisors and managers accountable for reporting secondary employment among staff that may infringe the provisions.

4. Your statement of business ethics should cover the subject of third parties employing staff.

5. Review requests for secondary employment, reports of secondary employment, complaints from customers, surveys and other sources of information to assess and improve the operation of your system for dealing with secondary employment.


6. Develop a standard form for staff to use when applying for approval to engage in secondary employment.

7. Develop a procedures for approving requests.

8. Maintain a register of all requests.

9. Ensure that your procedures and/or your code of conduct also deal with post separation employment and the use of Council’s intellectual property once an employee ceases to work for Council.


Local Government Act 1993, Section 353

Practical Guide to Corruption Prevention ICAC June 1997

Resources

According to the Local Government Act there should be a formal policy for the payment of expenses and the provision of facilities to the Mayor, Deputy Mayor and Councillors. The policy should be adopted in accordance with the Act and should comply with circulars issued by the Department of Local Government.

Having a policy and process for dealing with payments of expenses and the provision of facilities to Councillors helps ensure that payments and the provision and return of facilities are handled efficiently and transparently, and helps protect both Councillors and Council from allegations of improper conduct.

Why is it important?

About the payment of expenses and provision of facilities to Councillors.

Examine the policy and process, obtain feedback from representative Councillors and relevant staff, consider comments and information provided by the community and other relevant information to complete the table provided in this manual.

Action

1. Ensure that your policy is clear and practical and deals with all relevant matters, such as payment of expenses, conference attendance, what items are to be provided to councillors eg: computers, fax machines, stationery. The process for returning or purchasing facilities should be detailed in the policy.

2. Ensure that the policy is followed by Council. There should be a process to ensure that facilities used by Councillors are recorded and returned or purchased. The payments of expenses and the provision, use and return of facilities should be subject to audit.

3. Review the policy periodically – at least every two years – to ensure that it is current and relevant. Stakeholder sentiment should be taken into account when reviewing the policy.

4. Councillors should be given a copy of the policy and it should be covered in induction training.

5. Ensure that proper public consultation occurs in accordance with the Act prior to the policy and significant amendments to it being adopted.

6. Ensure that the policy is easily available to the public and stakeholders. When there are significant changes to the policy inform stakeholders of the changes.

7. Disclose appropriate details in Council’s annual report.


Local Government Act 1993 Section 252

Resources

The Local Government Act and Regulations set out a broad framework for Councils to follow in relation to tendering, purchasing and disposal. However, there is a need for Councils to supplement the legislative framework with their own policies, procedures and standards.

Staff should comply with the Act, other relevant legislation, sound commercial and administrative practices and the adopted policies and procedures of the Council.

In procurement and disposals it is not sufficient for the process to be fair and honest, it must be seen to be fair and honest too. Many allegations arise simply because of lack of transparency, appearances of conflicts of interest, perceptions of information being improperly obtained, etc. It is critical that people from Council involved in the processes fully understand the need to demonstrate that probity principles are being followed.

Procurement and disposals are activities that are at high risk of corruption and perceptions of corruption. ICAC notes that almost half of its investigation work and much of its corruption prevention advice has been in the areas of purchasing and tendering. Sound procurement and disposal procedures will help ensure that people have confidence in Council’s activities in these areas and reduce the risk of unfounded allegations.

Why are procurement and disposal procedures important?

About procurement and disposal procedures

Examine Council’s procedures for procurement and disposal, including tendering, and documentation of the procedures. Review audit reports, probity reports, complaints and allegations received. Consider obtaining feedback from some tenderers and potential tenderers (especially those that requested tender documentation but did not submit tender proposals), auditors, probity auditors, relevant staff and Councillors and consider examining some actual procurements and disposals.

Action

1. Establish documented processes for handling procurement and disposals that incorporate the principles of transparency and probity.

2. Conduct a risk assessment of the procurement and disposal activities and ensure that your process adequately addresses those risks, especially the risks of fraud, corruption and perceived corruption. ICAC guidelines and reports are a useful aid.

3. Establish any additional ethical standards for these activities which are in addition to those contained in the code of conduct, e.g. not accepting even token gifts during the evaluation phase of a tender.

4. Provide people involved in the process with the appropriate training and technical information as required.


5. Ensure tenderers and other relevant third parties are bound to comply with set standards of ethics.

6. Potential tenderers should be informed about what information contained in the tender will be made public.

7. Ensure that your procedures adequately cover purchases below the tender threshold.

8. Provide tenderers and other third parties with an avenue for making complaints outside of the purchasing and procurement areas.

9. Investigate all allegations of improper conduct and take appropriate action where allegations are substantiated.

10. For high–risk procurements or disposals, consider the use of a probity auditor.

11. Obtain feedback from customers, suppliers and people who have requested tender documents but not submitted tenders, to obtain information about the processes and how they can be improved.

12. Ensure that the procurement and disposal processes are subject to audit.

13. Prior to submitting tenders to Council for determination, conduct an independent staff review of the process followed to ensure that statutory and other requirements have been followed and that the process was fair and equitable.

14. At the end of major procurements or disposals assess the performance of the contractor. Include indicators of ethical conduct among the key performance indicators. Use the information in the assessment process for the award of future contracts.

15. Review the processes. Information that should be considered in the review includes the level of variations of contracts, performance assessments of contracts, complaints and allegations received, internal audit reports and recommendations, risk assessments, feedback from suppliers and others, developments in the field, reports from ICAC and other relevant bodies, etc.


Code of Practice for NSW Government Procurement, Department of Public Works and Services

Code of Tendering for NSW Government Procurement, Department of Public Works and Services

Implementation Guidelines for NSW Government Procurement, Department of Public Works and Services

NSW Procurement-at-a-glance, Department of Public Works and Services

Resources

NSW Procurement Manual, Department of Public Works and Services

Electronic Procurement Strategy, Department of Public Works and Services


Direct Negotiations in procurement and disposals: dealing directly with proponents, ICAC, June 1997

Probity Auditing: when, why and how, ICAC, December 1996

Contracting for Services: the probity perspective, ICAC, May 1995

Contracting for Services: probity checklist, ICAC, July 1995

Taking the con out of contracting guidelines, ICAC, September 2001

Garbage, drains and other things, ICAC, July 2001

Developing a Statement of Business Ethics, ICAC, June 2004

Guidelines for the engagement and use of consultants, NSW Premier’s Department, August 2000

Local Government Act 1993

Local Government (Tendering) Regulation

Resources

Council’s decision-making processes should comply with the principles of good governance. The processes should assist Council to demonstrate to the community and other stakeholders that it is operating with transparency, probity, and in the best interests of all concerned.

Having sound decision making processes that comply with principles of good governance will help Council’s individual decisions to withstand scrutiny by regulators, courts, the media and those affected by the decisions.

Sound decision-making processes help instill a culture of confi dence in Council and protect Council and its people against unfair criticism.

The code is a formal set of rules or procedures for the conduct of meetings. The code should set out how meetings are to be conducted.

The Local Government Act contains a number of provisions dealing with the code of meeting practice, primarily the preparation, public notice, exhibition, adoption, amendment and public availability of the code. The Act requires Council to conduct relevant meetings in accordance with the code.

The contents of the code should be appropriate to ensure that meetings run fairly and effectively.

The code of meeting practice contains the rules for Council and committee meetings. Without a code there may be a level of anarchy or at least a greater level of conflict or disagreement about the conduct of the meetings. Clear and practical codes help ensure that conflict in meetings about what should happen next is minimised and that meetings operate more efficiently and effectively.

Why is the code important?

About codes of meeting practice

Review the code of meeting practice and its operation in accordance with the table.

Action

1. Ensure that your code helps meetings run effectively and fairly and that it facilitates community and stakeholder participation.

2. Provide each Councillor with a copy of the code.

3. Ensure that the code is covered in induction training.

4. When the code is revised, ensure that each Councillor receives a copy and, if applicable, training.

5. The code should be available at meetings.

6. Allow stakeholders to comment on significant changes that could affect them, and take account of their comments before making changes. Ensure that stakeholders and the community are informed of significant changes to the code that could affect them.

7. Review the code periodically - at least every two years - to ensure that it is current and relevant.

8. Establish a system for Councillors and stakeholders to make suggestions for enhancements to the code.


9. Ensure that staff who may be called upon to provide advice at Council or Committee meetings are properly trained on the code.

10. Ensure that the code is consistent with the Local Government (Meetings) Regulation and the relevant provisions of the Local Government Act.

11. Ensure that the code clearly addresses common procedures which are not covered in the legislation . For example public participation at Council meetings, order of business and electronic agendas and business papers.

12. Ensure that the code deals with provisions in the legislation which confer discretion. For example granting of power to remove people for disorder and taping of meetings.


Local Government Act 1993, Chapter 12 Part 2

Local Government (Meetings) Regulation

Resources

Councils are complex organisations. It is often impractical and inefficient for all matters requiring consideration by Council to be submitted directly to a full meeting of the Council. To address this problem many councils have established committee structures to enable matters to be considered in a more appropriate way.

Committees may include standing committees of Council which consist only of Councillors and community or advisory committees which make recommendations and may contain members who are not Councillors. It is important from a governance point of view that all committees have in place charters or constitutions which clearly spell out their function, structure and authority.


Use the table to assess the committee system. Take into account feedback from Councillors, relevant staff and stakeholders.

Action

Committee systems are important to ensure that decisions of Council are made in an effective and efficient manner. It is important to ensure that the Committee structure works effectively and that Committees do not exceed any delegations given to them by Councils. Poorly functioning committee systems can result in inefficient decision-making and expose the Council to financial, corruption, legal and other risks.

Why is the committee system important?

About the committee system

1. Ensure all Council committees have a charter or constitution which at least address purpose, functions, membership, meeting procedures, delegation of authority, reporting requirements, code of conduct for members, period of operation, minute taking and participation by non members

2. Ensure that all Committee charters or constitutions are adopted by Council.

3. All committee members should receive a copy of the charter or constitution and be inducted into the committee. Committee members who are not Council staff or Councillors should receive appropriate training in Council’s code of conduct and relevant policies and procedures.

4. Council should establish guidelines as to how, when and why committees are established

5. Ensure that Committees prepare regular reports on their activities and refer matters requiring decisions or endorsement to the relevant person or body e.g. Council.

6. Ensure that the operation and effectiveness of committees are reviewed on a regular basis and at least every four years at an appropriate point during the term of each elected Council

7. Determine whether any committee members who are not Council staff or Councillors should be regarded as designated persons in accordance with the pecuniary interest provisions of the Local Government Act.


Local Government (Meetings) Regulation

Resources

Stakeholders may be considered as those people who have more than a passing interest in Council. Among the key external stakeholders are residents, ratepayers, customers of services, providers of services on behalf of Council, etc.

A general principle is that when people are likely to be affected by an activity or decision of Council they should be told about the activity or decision and should be given the opportunity to give Council relevant information.

Council should comply with the requirements of the Local Government Act and other relevant legislation for community consultation.

The provision of information should be done in accordance with the Local Government Act, the Freedom of Information legislation, the privacy legislation and code and other relevant legislation.


Consider the community consultation processes and activities and the provision of information to the public and stakeholders in accordance with the table. Consider complaints received, allegations or complaints to watchdog organizations, surveys, objections to decisions, and other relevant sources of information.

Action

The impact of Council’s decisions, activities and operations on stakeholders can be dramatic because Council undertakes so many vital roles in the community. It is therefore important that we pay appropriate attention to the needs and wants of stakeholders, give stakeholders the opportunity to be involved in Council’s functions where appropriate and to be heard by Council. We should also give stakeholders the information they need to understand Council’s role, processes, decisions, etc.

Giving people the opportunity to be heard, listening to them and providing them with appropriate information will help ensure that Council’s activities meet stakeholder needs, that stakeholders feel involved with Council and more positive in their perceptions of Council.

Why is the involvement of stakeholders important?

About the involvement of stakeholders

1. Identify the relevant legislation and ensure that you are complying with the requirements for the provision of information and consultation.

2. Ensure that documented processes are in place to consult with stakeholders where significant changes are made to Council’s activities or where important decisions will be made that may affect the stakeholders.

3. Ensure that the information provided to stakeholders is sufficiently comprehensive and clearly stated that they can understand the key issues.

4. Ensure that information is provided in easily accessible ways e.g. pamphlets, the internet, Council publications, the local media. Ideally, information should be provided in a number of ways.

5. Ensure that stakeholders understand how to present their views to Council and what their rights to be heard are.

6. Make it as easy as practical for stakeholders to present their information to Council.

7. Take suffi cient measures to let the public know what information they may legally access at Council. It is suggested that a brochure should be published, notice placed on the internet and other appropriate measures taken.

8. Conduct regular surveys or reviews to gauge whether stakeholders are satisfi ed with their ability to have input into Council decisions.

9. Consider developing a general policy or matrix which provides general guidance to staff and stakeholders about Council’s approach to consultation.



Freedom of Information Act 1989




Better Service & Communication for Council, NSW Ombudsman, June 2000

Better Service Through Consultation: Approaches to Consultation for Government Agencies (Best Practice Paper No. 1), Offi ce of Social Policy, 1993

Delivering the Message: Best Practice in Providing Government Information (Best Practice Paper No. 7), Offi ce of Social Policy, 1995

Resourcing Consultation: a Manual to assist Consultation by Government Agencies (Best Practice Paper No. 2), Offi ce of Social Policy, 1993

Resources

There are a number of provisions relating to delegations in the Local Government Act and these must be followed. Council can only delegate certain functions to certain people or bodies and some functions and powers cannot be delegated.

Council cannot delegate to Council staff other than the General Manager, who is responsible for staff delegations. The delegations should not include functions or powers which the Local Government Act states are not to be delegated. Where there are delegations to committees of Councillors, they should be by Council, and in accordance with the Act.

For delegations to work properly it is important to ensure that delegations are made properly, that people understand their delegations and how to carry out the delegated activities, and that people are given adequate resources to carry out their delegations effectively.

Council and/or senior officers should not dictate how delegations of authority are to be exercised, or professional judgments made, in relation to any specific cases or circumstances. Guidelines or criteria may be established on the basis of which delegations of authority are to be exercised.

Where Council staff have delegations from outside authorities they cannot be forced to use their authority.

Action

Examine your records of delegations and systems for making, recording and updating delegations.

Delegations give people the authority to make certain decisions, perform certain functions or undertake certain activities. If the delegations are not done properly, the enforceability of decisions and actions taken may be compromised and there may be legal and administrative problems for Council.

Why are delegations important?

About delegations


1. Ensure Council has formally approved delegation of authority to the General Manager and other bodies in accordance with the legislation.

2. Ensure that the delegations specifically address the scope of the authority to act as well as the reservation of powers to the General Manager or other bodies and the standards of internal control expected. Delegations should address compliance with internal policies and procedures.

3. Ensure that the General Manager has formally delegated power to his senior officers to act without reference to the General Manager and /or Council. Ensure that the delegations include the reservation of powers to the General Manager/Council and the expected standards of internal control. Such delegations should encourage senior officers to suggest further delegations for their staff to the General Manager in accordance with the internal control framework. These delegations may be issued either as individual delegation letters or as a scheme of delegation applicable throughout the Council.

4. Councils may approve templates for model individual delegations to senior managers and their staff or as an alternative a scheme of delegation and reservation of powers for issue throughout the Council.

5. Delegations must be formally documented and signed by the person granting the delegation.

6. The delegations should be appropriate bearing in mind the person’s capabilities, qualifications, motivation levels and development needs. Delegations should not result in people being ‘swamped’ with matters that they do not have the time to check or being required to make decisions on matters for which they are not trained or qualified.

7. People, committees and bodies who receive delegations should be given written notification of their delegations.

8. Delegations should be reviewed regularly, at least every two years and in accordance with the Act (ie within 12 months after a local government election). When changes occur in Council the relevant delegations should be reviewed to ensure that they are still appropriate.

9. All delegations should be recorded in a register and there should be a process to capture all delegations when they are made by Council or the General Manager. The records of delegation should be archived appropriately and in compliance with legislation

10. People should understand their delegations and this should be included in induction and other appropriate training.

11. The register of delegations should be available to the public.

12. There must be an appropriate level of control, oversight, supervision and regular review and audit to ensure the delegations and the use of delegations are appropriate.

13. There should be a process to ensure that temporary delegations are properly authorized, notified, recorded and archived.

14. During periods of structural change the delegations should be updated frequently to ensure that they are current and accurate.

15. There must be a proper reporting of decisions made under delegated authority.

16. Consideration should be given to whether delegations will be made to persons or to positions. Both are permissible.

17. Ensure that all instruments of delegation comply with the provisions of the Interpretation Act 1987.

18. Ensure that there is a system for identifying which delegations are current and storing superseded delegations for future reference.



Environmental Planning and Assessment Act 1979

Good Conduct and Administrative Practice Guidelines for state and local government, NSW Ombudsman, August 2003

Interpretation Act 1987

Resources

The Local Government Act requires every Council to prepare a draft management plan and contains provisions on its adoption.

The management plan should have a strategic component and an operational component

According to the NSW Department of Local Government guidelines, the purpose of the strategic component is to reflect the strategic thinking of Council, document the future directions, communicate to the community and stakeholders, and set the framework for Councillor and senior staff decision–making, performance monitoring, principal activity involvement and allocation of resources.

The strategic component contains the strategic intent, areas of change with significant impact, key future achievements and broad financial aspects.

The operational component includes asset management plans, business and commercial activity plans, human resource plan, EEO management plan, environmental plans, land use plans, social and community plans and access and equity requirements.

Action

Assess Council’s management plan and the planning and performance assessment process.

The management plan helps translate Council’s strategic thinking into concrete planning. It helps ensure that all of the relevant areas and issues are considered in planning. The planning in turn helps direct the actions and activities of Council.

Why is the management plan important?

About management plans


1. Ensure that your management plan complies with the provisions of the Local Government Act and the Department of Local Government’s Management Planning Guidelines.

2. Ensure that your management plan contains both a strategic and an operational component.

3. Ensure that your Plan is developed with appropriate input from staff, councillors and other key stakeholders. The Plan should be developed using a “whole-of-Council” approach

4. Ensure that the community consultation leading up to the adoption of the plan is meaningful.

5. Ensure that your plan contains a clear vision and mission for Council.

6. Develop strategies to integrate the Plan into the Council culture and operations

7. Ensure that the quarterly reporting requirements of the Local Government Act are adhered to.

8. Ensure consistency between the Management Plan and the relevant components of the annual report.

9. Ensure that your management plan is readily available to members of the public and other stakeholders.

10. Ensure that the content, format and system for compiling the management plan are reviewed on a regular basis.


Management Planning for NSW Local Government Guidelines, NSW Department of Local Government, February 2000

Local Government Act 1993, Chapter 13, Part 2

Resources

A policy is a document which expresses Council’s position on a particular issue or subject. It is the “what” and “why” of Council decision-making. Procedures are the individual steps that are to be followed in order to implement a policy. They are a step by step guide as to who carries out which part of the policy, when it should be carried out and how it is to be carried out. Procedures are effectively the “who, how and when” of Council decision-making. Policies and procedures must be formally adopted and comply with legal obligations and relevant community standards.

Action

Ensure that Council has in place an effective system for policy and procedure development, implementation and review.

Policies and procedures are essential to ensure legal, fair and consistent decision-making across Council. They support Council in achieving its corporate objectives and provide a critical guide for staff, Councillors and other stakeholders. In the absence of effective policies and procedures there is a greater risk of inconsistency, confusion and inefficiency.

Why are policies and procedures important?

About policies and procedures


1. Develop a consistent format for all Council policies and procedures.

2. Ensure that all policies and procedures at least include relevant information such as objectives, scope, legislative requirements and review dates .

3. Ensure that risk management and corruption prevention issues are taken into account when developing policies and procedures.

4. Ensure that there is a clearly documented process for adopting policies and procedures.

5. Maintain an accessible register of corporate policies and procedures.

6. Ensure that all new policies and procedures are communicated to relevant staff and stakeholders.

7. Ensure policies and procedures are reviewed in accordance with their predetermined review date.

8. Ensure that relevant internal and external stakeholders are involved in policy and procedure development.

9. Ensure that appropriate training is provided to staff on relevant policies and procedures.

10. Maintain a register of superseded policies and procedures.

11. Consult with peer councils and share policies as they are reviewed.

Department of Local Government website – www.dlg.nsw.gov.au

Independent Commission Against Corruption website – www.icac.nsw.gov.au

NSW Ombudsman website – www.ombo.nsw.gov.au

Resources

Monitoring and review processes are important to ensure that Council is operating appropriately and that Council and people at Council are accountable for their actions.

Monitoring and review also helps to ensure that Council can react to changes in its environment effi ciently and effectively, to the benefi t of Council, its people and the community.

This section considers the signifi cant areas of monitoring and review in Council.

The Local Government Act requires Council to make an annual report on its achievements with respect to the objectives and performance targets set out in its management plans for that year. The Act lists various items to be included in the annual report.


Assess Council’s annual report. In addition to looking at the last annual report, consider the process for completing the report and feedback from stakeholders about the report.

Action

The annual report is the key reporting document for informing stakeholders about the activities of Council and the results of those activities.

Why is the annual report important?

About annual reports

1. In addition to including what must be reported, include items that will help stakeholders understand the activities of Council and the outcomes achieved.

2. Include information about Council’s governance structure, key results and performance indicators, etc.

3. Always think of the potential readers when preparing the annual report.

4. Ideally have the annual report and past annual reports on your website.

5. Ensure that stakeholders can get a copy of your annual report easily.

6. Consider producing a summary version of the report which could be sent to all ratepayers.

7. Conduct periodic surveys or reviews to gauge reader satisfaction with the content and layout of your report

8. Ensure that legislative deadlines are met.

Local Government Act 1993, s428

Local Government (General) Regulation 1999

Resources

According to the Premier’s Department policy the following will help ensure better practice:

1. Ensure that the objectives of the system are clearly defined

2. Ensure that the system is aligned with Council’s objectives, priorities and strategies

3. The system is designed in full consultation with employees and their representatives

4. The system is equitable

5. Council fosters performance recognition and realisation of the individual’s potential by taking a positive approach to cultural change and focusing on outcomes, continuous improvement and training. Performance management is not used as a primarily punitive means of dealing with unsatisfactory performance or disciplinary matters.

6. Managers and supervisors perceive performance management as a fundamental and ongoing management function and a key planning and evaluation mechanism. Council fosters ‘whole-of-Council’ ownership of performance management processes rather than managerial or human resource specialist ownership.

The Premier’s Department policy notes that performance management is a principal tool in achieving corporate objectives in that it links those objectives with employee goals and achievements. It focuses on improving performance through matching outcomes against individual, team and Council’s objectives, and to the training and development needs of employees at all levels. Managers using performance management effectively are generally more concerned with performance planning and improvement than retrospective performance assessment. Performance management provides for both recognition of high performance and early detection of performance that is not meeting expectations, allowing prompt remedial action to be taken.

The performance of activities undertaken by Council should be assessed, particularly against the management plan. Key performance indicators are generally appropriate for this.


Assess your performance management system and assess staff perceptions of the system.

Action

Performance management helps ensure individual accountability and the achievement of Council’s objectives. Good performance management enhances trust and encourages people to take personal responsibility for maintaining high standards of ethical conduct.

Why is performance management important?

About performance management

7. Comprehensive training is provided

8. Performance criteria and standards are clearly defi ned in workplans and are objective, job-related and based on performance over which the team or individual can exert control.

9. Confi dentiality is assured and data generated is used appropriately

10. The system is linked to a sound grievance handling process

11. The system is regularly reviewed


Performance Management, Policy and guidelines, NSW Premier’s Department December 1998

Local Government (State) Award

Resources

Councils receive numerous complaints about Council services and programs. A complaint can generally be defi ned as feedback from a customer that Council has not met a service delivery expectation or target. Complaints should not be confused with requests for service. For complaints to be dealt with properly, a complaints handling system should be in place.

Examine your complaints handling system and the taking of and resolution of a sample of complaints. Consider feedback received from staff, Councillors and the community regarding complaints handling and customer satisfaction in surveys, exit interviews, etc. Examine any complaints about the complaints handling system.

Action

Complaints are a valuable source of information for Council to improve their services and help get and retain stakeholder support for Council activities. If people feel that their complaints are not being listened to and acted upon, they tend to feel alienated and angry.

Complaints are an important mechanism for receiving feedback from stakeholders and having appropriate systems for dealing with complaints is therefore a signifi cant part of good governance.

There are three important benefi ts from an effective complaints handling system:

• Identifying areas where improvements are needed

• Having a second chance to satisfy dissatisfi ed customers and other stakeholders

• Strengthening public support for Council.

It has been reported that less than 4% of dissatisfi ed customers bother to complain. Therefore, each complaint examined provides an opportunity to gain insights into an area that is otherwise largely hidden from Council.

It has also been reported that dissatisfi ed customers tell about 20 other people of their problem. Dealing with complaints effectively will help prevent that negative (and possibly inaccurate) information about Council being spread around.

Research has also shown that if people complain and are satisfi ed with the handling of their complaint, they tend to be more loyal and supportive than people who have experienced no problems at all.

Why is complaints handling important?

About complaints handling

1. According to the Ombudsman the complaints handling system should have the following:

• A definition of a complaint

• An explanation about how, where, when and to whom complaints should be made

• At least a three tiered system with the first stage being making the complaint with front line staff and them trying to resolve it; the second being investigation by a more senior person if the customer is still unsatisfied; and the third being referral for legal remedy, alternative disputes resolution or to an outside agency.

• Proper recording of complaints

• A form used for easy processing [this could include a computerised form]

• Clearly defined responsibilities for dealing with complaints

• A checking mechanism to ensure that remedies are provided where appropriate

• Someone should have responsibility for managing the complaints system.

2. Ensure that individual complaints as well as trends and issues identified by a broader assessment of complaints are considered.

3. Ensure that deficiencies in systems and procedures identified by complaints are dealt with.

4. Ensure staff receive adequate training in handling complaints and dealing with complainants.

5. Carry out periodic analysis of complaints to determine areas of improvement

6. Make details of your complaints handling system available to members of the public at key customer service points.


Complaint Handler’s Tool Kit, NSW Ombudsman

Good Conduct and Administrative Practice Guidelines for state and local government, Part B, Section 10 –Complaint Handling, NSW Ombudsman, August 2003

Australian Standard on Complaints Handling, Australian Standards Association

Options for Redress, Guidelines for Redress for Detriment arising out of Maladministration, NSW Ombudsman, June 2000

Apologies by Council, Council fact sheet No. 5, NSW Ombudsman, April 2003

Resources

Some registers are required to be kept by law while other registers are kept as a result of a Council’s policy decision e.g. declarations of gifts and benefits, and requests for secondary employment or business.

Identify the registers currently kept by Council against statutory and Council policy requirements. Identify and evaluate any gaps i.e. does good practice material identify other types of registers which a Council should consider, such as a gifts and benefits register for Councillors and staff?

Examine all registers kept for content, maintenance and currency. Examine Council’s processes in relation to training and awareness relating to the registers. Examine Council’s processes and compliance with privacy requirements.

Action

Registers serve as important evidence to show that staff, Councillors and Council are doing the right thing. Registers are a critical component to show transparency in the way Council conducts its affairs. Without registers there may be some doubt as to whether or not people followed the appropriate practices and acted ethically. The registers help to remove this doubt.

It must also be remembered that good governance requires Councils to comply with applicable legislation, including the keeping of any registers required by law.

Why are registers important?

About registers

1. Have registers for all of the items where keeping registers is a good method of ensuring transparency and that all items are treated appropriately.

2. Ensure that the format of the registers meet any statutory requirements in relation to content, are easily understood and easily maintained.

3. The registers should record who gave the approval, where appropriate.

4. Ensure that personal information collected, used, held and managed by Council is done so in accordance with the principles of privacy and personal information protection. (See also Section 2.5 of this manual.)

5. Ensure that there is in place procedures to deal with requests to have personal information removed from the publicly available version of the register and not disclosed to the public, provided the agency is satisfied that the safety or well-being of any person would be affected by not suppressing it.

6. Ensure that the registers are covered in the appropriate policies.

7. Provide appropriate training and awareness for Councillors and staff about the registers.


8. Encourage a culture of compliance with the spirit of transparency and probity in relation to the registers.

9. Ensure that breaches of the requirements set out in the register and relevant policies are dealt with appropriately.

10. Ensure that the registers are stored in a safe and secure manner.

11. Ensure that procedures are in place to retain, where appropriate, superseded documents.

12. Ensure that there are clear procedures for staff, councillor and public access to the registers.

13. Examples of the types of statutory and non statutory registers are listed below.



Environmental Planning and Assessment Act 1979




Resources

Land register – section 53, Local Government Act 1993

Records of approvals – section 113, Local Government Act 1993

Register of pecuniary interests – sections 449 – 450A, Local Government Act 1993

Rates Record – section 602, Local Government Act 1993

Register of consents and approvals – section 100, Environmental Planning and Assessment Act 1979

Record of building certificates – section 149G, Environmental Planning and Assessment Act 1979

Public register of licences held – section 308, Protection of Environment Operations Act 1997

Record of impounding – sections 30 –31, Impounding Act 1993.

Examples of Statutory Registers

Delegations registers

Conflicts of interest registers

Gifts and benefits registers

Secondary employment registers

Examples of Non Statutory Registers

Councils create and possess a large range of documents for a variety of purposes. It is accepted that the public should have a general right of access to non-confidential Council documents The are a number of different avenues for members of the public to obtain access to Council held documents. These include section 12 of the Local Government Act, the Freedom of Information Act and the Privacy and Personal Information Protection Act. In many ways the provisions contained in these Acts overlap and are inconsistent. It is therefore important that Councils have clear processes and policies for dealing with public requests for access to Council documents.

Ensure that Council has in place relevant and appropriate policies and procedures for enabling public access to Council documents in a manner that complies with relevant legislation.

Action

An important element of accountability is open and transparent decision-making. Implicit in this requirement is the need for members of the public to be able to access documents which show records of decisions, the reasons for those decisions and the processes that were followed. Providing an effective and efficient mechanism for public access to Council documents is therefore an important part of public accountability.

In addition, numerous pieces of legislation – in particular the three Acts listed above – require Councils to make certain documents available in particular circumstances. Councils have a legislative obligation to comply with these provisions.

Why is access to documents important?

About access to documents

1. Ensure that Council has formally delegated authority to relevant staff to deal with and determine Freedom of Information and section 12 Local Government Act applications for access to documents.

2. Ensure that all documents listed in section 12(1) of the Local Government Act are available for public inspection and copying/ taking away.

3. Ensure that reasons are provided in accordance with section 12A of the Local Government Act whenever access to a document is restricted and that these reasons are reviewed within three months.

4. Consider adopting an Access to Documents Policy which clearly sets out Council’s policy and procedures for allowing access to documents under section 12(6) of the Local Government Act.

5. Ensure that a register is kept of all applications to access documents under section 12(6) of the Local Government Act and the Freedom of Information Act.

6. Develop procedures for dealing with requests to access Council documents


7. Ensure that relevant staff, particularly front line customer service staff, are properly trained on access to documents policies and procedures.

8. Ensure that the process by which members of the public can access Council documents is contained on Council’s web site.

9. Review the policy and procedures periodically, at least every two years.

10. Ensure, in particular, that any policies and procedures clearly explain Council’s position on providing access to names and details of complainants and persons making submissions to Council.

11. Ensure that any policies and procedures are consistent with the provisions of the Privacy and Personal Information Protection Act.

12. Periodically review statistics from the register of applications to determine issues/trends in relation to access to documents.


Freedom of Information Act 1989

Freedom of Information Procedures Manual – 3rd Edition, NSW Premiers Department,1994

Freedom of Information Policies and Guidelines – 2nd Edition, NSW Ombudsman January 1997

Local Government Act 1993, section12


Resources