Carey sells pragmatic reform process

Stopping local councils from sliding into disarray is John Carey’s main priority, and there are several reasons for that.

The highest profile of these is the City of Perth inquiry, which, after two-and-a-half years and a cost of $7.8 million, turned up serious allegations of wrongdoing that Mr Carey’s predecessor as local government minister, David Templeman (2017-21), said were of consequence for every council in Western Australia.

Tony Power led that inquiry and his accompanying report, released in 2020, identified gaps in ministerial and department oversight of councils, especially when compared to other states and territories.

The report recommended the state government legislate for an inspector’s office directly accountable to the minister to address the problem.

That this recommendation has become central to the state government’s reform proposals, updated last month following consultation, is no surprise.

During his tenure as local government minister, Mr Templeman called no fewer than 10 inquiries, at least two of which concerned the Shire of Toodyay.

Another, focused on Town of Cambridge, was challenged by the council in the Supreme Court of Western Australia, with Mr Templeman later found by Justice Paul Tottle to have taken ‘disproportionate’ action in seeking its suspension.

Another element in the mix is cost, with inquiries financially and politically draining at the best of times.

They eat into the Department of Local Government Sport and Cultural Industries’ resources, which isn’t insignificant given its resource constraints cuts following machinery of government changes pushed through in 2017.

As blunt a tool as these inquiries are, Mr Carey told Business News they were about the only power at his disposal.

“Part of the problem is the powers that currently exist are vague,” he said.

“You end up [in a situation where] the only way [to deal with an issue] is a full-blown inquiry, which no-one’s the winner from.”

Creating an inspector’s office, as was proposed by Mr Carey last November, will no doubt alleviate that problem.

It’s just one part of state government’s reform efforts, billed as the most ambitious since the Local Government Act was introduced in the mid-1990s.

Many of the ideas, including for a newly reconstituted Conduct Panel and removing the WA Local Government Association from the Act, have won broad support from the sector, alongside a raft of minor changes to red tape around small business approvals and financial reporting.

In substance, tightening oversight of the sector looms as a large part of Mr Carey’s proposals, an inevitable reflection of the City of Perth inquiry’s stated influence on the package.

Some have labelled the scope of what’s on offer a missed opportunity, however.

Ryan Goss, law professor at Australian National University, wrote to the department during consultation urging the government to remove property franchise voting and introduce universal compulsory voting at a local level.

Legalise Cannabis MLC Brian Walker called the reforms “substantial” while also using his submission to bemoan the proposals as ‘limited’ and ‘downscaled’ reform.

None of that is of concern to Mr Carey, who says his ideas constitute the biggest shakeup to local government in the past 25 years.

Pressed on criticisms of the planned reforms, the minister highlighted an array of proposed changes he said were significant in scope, including a rates and revenue policy, community engagement charters, and standardised orders for council briefings and meetings.

“While we’re dealing with the dysfunction, there are a huge raft of reforms across the themes that I’ve highlighted previously, and it’s about greater standardisation, greater transparency and greater accountability,” Mr Carey said.

That the state government has come this close to passing a Bill at all is noteworthy.

State governments have repeatedly pledged to reform WA’s Local Government Act since it was introduced by Paul Omodei in the Court era, and the tenor of discussion has often been geared towards dealing with a level of unprofessional behaviour that can creep into local politics.

The current appetite for reform is best viewed through the events of 2017.

On the government benches after Labor’s election win in March, Mr Templeman wrote to the WA Local Government Association outlining a two-step process to reform, with the first step encompassing modernising the Act and the second about improving services overall.

In language, if nothing else, this was a conciliatory (if not symbolic) approach.

Colin Barnett’s government had made a run at reform in its second term, commissioning former University of Western Australia vice-chancellor Alan Robson to lead a review of the sector.

That report, which suggested that Perth have ‘fewer, larger, more capable local governments’ to deal with financial and planning issues, was one factor in the Barnett government’s decision to push ahead with plans for amalgamation.

Implementation of the reforms proved fraught, however, first being watered down following opposition from the Nationals, and then put to just five local governments via non-binding referenda of electors.

All of them failed.

Some councillors were unhappy with how the process played out and Labor in opposition made a point to side with them, with Mark McGowan in 2015 labelling attempts to expand the City of Perth’s boundaries a dog’s breakfast.

Mr Carey was outside of state politics but nevertheless made his position clear after the City of Vincent (at which he was mayor) played a significant role in opposing Development Assessment Panels through the ‘Scrap the DAP’ campaign in 2017.

Labor’s election platform already contained reform ideas for when it came to government.

Among these were the introduction of universal compulsory voting and amendments to the Act to reflect differing regulation, compliance and administration burdens across local governments.

The process didn’t begin in earnest until 2019, when Mr Templeman formed a panel, chaired by former City of Stirling councillor and state Labor MP David Michael, to oversee the rewrite.

At the same time, a select committee in the upper house chaired by Liberal MLC Simon O'Brien produced its own report, largely examining broader priorities beyond the remit of the state government’s panel.

Both concluded that a new Act should be written with a handful of priorities, including a statement of functions, appropriate resourcing for the department, and the pursuit of early intervention.

News coverage of both reports, released in 2020, was relatively muted amid the first year of the pandemic, especially when stacked against the publicity surrounding the City of Perth inquiry.

No less detailed in its findings, Tony Power’s report was brimming with comparatively salacious excerpts, including that at least three councillors were believed to have created sham leases to either run for office or enrol voters in the electorate.

By the end of it, Mr Power’s team had found a “dysfunctional and inefficient organisation”, with poor decisions the result of poor governance and a background of “widespread culture and systemic failings”.

A new council election was held in 2020 and, despite efforts by some, none of the council’s previously serving members won a seat.

Mr Templeman’s response to the report made clear the findings did not constitute an aberration.

“I urge everyone in local government to read this report and understand the implications for the sector,” he said.

Mr Power had bolstered the case for a legislative response.

His report identified serious deficiencies in the early intervention powers of the minister and director general and recommended the state government introduce pre-emptive investigative functions as a matter of necessity.

“The current system for monitoring, promoting and enforcing the integrity, efficiency and effectiveness of local governments is fragmented and can be cumbersome,” Mr Power wrote.

“Centralising and better defining the functions dealing with these matters will promote consistent, fair and timely resolutions.”

Much of this discussion seemed to have been scotched ahead of the 2021 election.

Mr Carey was a last-minute addition to cabinet after the government’s re-election amidst factional wrangling by left-aligned MPs.

In his new portfolio, however, the member for Perth was given a clean slate to establish his own priorities for reform.

It took him just six months to produce a package of reforms, based in part on Mr Michael’s findings, the Legislative Council’s report and Mr Power’s inquiry.

Paramount to his package is the proposed creation of a chief inspector of local government, who would have the power to delegate monitors to councils of concern and force mediation before any breach of the Act occurs.

That’s coupled with the inspector’s broad remit to receive and assess complaints, as opposed to the newly constituted Conduct Panel, and an expansion of ministerial power to suspend individual councillors rather than an entire council.

Some proposals appear prescient in hindsight, including reform to laws governing how and when councils can meet, and the standard for which meetings can be held in private.

Mr Carey’s suggestion is that almost all meetings should be held in public.

That’s consistent with public statements made in May, when he excoriated the Town of Cambridge after it was alleged to have called a meeting to consider removing confidentiality obligations from items at previous meetings with just 22 minutes’ notice.

The minister alluded to this in a post to social media just days after the reported incident.

“Council meetings are critical to local government, because they are the forum in which issues are considered and significant decisions are made,” Mr Carey wrote.

“These decisions can impact on ratepayers, residents, small businesses, and other stakeholders, so it is critical that everyone has an opportunity to engage with their council.”

Most of the minister’s suggestions are of less consequence than this and tackle perennial issues concerning local government regulation.

Resource sharing–an alternative to forced amalgamations–is among the notable suggestions, with enabling legislation to go some way towards alleviating pressure on the state’s smaller local governments to hire and retain top-level administration staff.

Less headline-grabbing is the idea that laws governing approvals for driveways that run between footpaths and homes be standardised.

Indeed, most councillors who have spoken to Business News (both previously and for this article) are broadly supportive of what Mr Carey is trying to achieve.

Countless submissions during consultation bear that out. Where agreement appears to come unstuck is around the scope and depth of what is on offer.

Among concerns is that these changes will comprise amendments to the Act rather than an entirely new one, as was outlined in the brief accompanying Mr Michael’s report.

For interested observers such as Larry Graham, who served three terms as a state Labor MP and another as an independent, the shift has proved frustrating.

“Why would you [amend the Act] when you can actually reform the system and make the WA system of local government the most effective and the most efficient in the nation?” Mr Graham asked.

Business News put this assertion to Mr Carey last month, with the minister insisting his approach was about getting things done in a timely manner.

“We want to achieve key reforms to the local government sector, and it’s focused on dysfunction, and we desperately need it because the current Act fails in relation to effective regulation where there is dysfunction,” Mr Carey said.

There’s merit to this conciliatory style, with the opposition’s local government spokesperson, Shane Love, having told Business News he’d found the government to be open throughout the process thus far.

Mr Love said he wanted an Act that recognised diversity across local governments, having attended briefings with the minister to discuss what’s on the table.

While reserving his position, Mr Love appeared positive about the process so far and agreed that early intervention was a priority.

“I’ve said to [the minister] … I don’t really want to fight about stuff that I actually 99 per cent support,” Mr Love said.

“It doesn’t mean we don’t reserve the right to critique what is actually presented and make sure that they achieve what’s being set out to achieve.”

Some level of compromise is useful in negotiating any big reform, and few appear willing to argue Mr Carey hasn’t banked plentiful amounts of goodwill through his time as mayor of City of Vincent and since his election to state parliament in 2017.

However, some observers seem irked by the extent to which the lessons of the City of Perth inquiry, and particularly punishing and monitoring misbehaving councillors, has been given prominence in the reform package.

City of Stirling Mayor Mark Irwin is generally supportive of what’s on offer, particularly as it relates to relaxing approval processes and engaging positively with ratepayers.

Still, he bemoans some of the language on which the reforms are based.

“It always seems to be negative in terms of local government needing to be fixed, and that came out a lot with these reforms in terms of recognising the sector may need fixing,” Mr Irwin said.

“We’re always cautious [about trying] to legislate to the lowest common denominator.

“We want to see that not [just focus on] problem councils, but also enable the good ones to be better.”

That view was broadly shared by City of Armadale Mayor Ruth Butterfield, who agreed that incidents like the City of Perth inquiry tended to have an outsized presence when reform was discussed.

“It’s not reflective of the general working of the organisation [of local government],” she said.

Mr Carey was eager to point out the early intervention formed just a small segment of a single part of six different themes in his package.

The point remains that intervening in problem councils was the key focus of reforms when introduced last November and was again given prominence in media statements when the revised proposals were released last month.

The biggest change following consultation was arguably the stiffening of penalties, most notably through introduction of a three-strike rule for councillors.

That change appears to have been drawn from Mr Omodei’s appearance at the Legislative Council’s select committee in 2020, at which he endorsed a rule that would result in a five-year ban for recalcitrant councillors.

Mr Carey has proposed it be 10 years, with bad behaviour by a select few cited as the reason.

“In recent weeks and months, we have seen examples of councils not operating as they should, and poor behaviour among elected members,” the minister said in an accompanying statement.

“[T]he changes we’re introducing are aimed at addressing those issues sooner.

“The public are fed up with dysfunction and repeat bad behaviour by a small number of councillors. Chaotic meetings and petty squabbles are not good enough.”

None of this is to say the government’s reforms lack support.

WALGA was effusive in its praise for the overhauled proposals, with association president Karen Chappel lauding the minister for having listened to its advocacy.

That WALGA staked claim to about half a dozen changes, including removing the requirement that audit committees have majority independent members, would have been considered a significant win.

Some changes have also alleviated major concerns raised during the consultation process.

For example, presiding members will no longer be allowed to ‘red card’, or unilaterally silence, attendees at meetings, a proposition that was widely panned when introduced.

Instead, they will be vested with broad powers to ‘maintain order’.

In scope, though, much of what’s on offer falls short of what’s on the books in other states and territories, and in some parts ignores suggestions made by the three reports cited in formulating proposed reforms.

Changes to the voting system serves as an example. All states and territories bar South Australia and Tasmania require universal compulsory voting at local elections, and nowhere in Australia other than WA uses the first-past-the-post system.

Mr Carey had first proposed the state introduce preferential voting at a local level, having since amended that to optional preferential voting. Compulsory voting has been repeatedly ruled out as too costly to administer.

Some, including Town of Victoria Park Mayor Karen Vernon, have questioned whether that was effective.

She’s no fan of preferential voting, arguing it could give rise to preference harvesting and politicisation of voting at council elections, but argued compulsory voting would be a far better method of increasing engagement with the community.

“One of the reasoning and arguments that was put forward behind this idea about preferential voting was about actually increasing voter participation,” Ms Vernon said.

“The only thing that will increase voter participation is compulsory voting.”

Property franchise, almost unique in Australia as one of few jurisdictions in the world that still allows it, is another issue that’s proved contentious, as evidenced by the submission of ANU’s Professor Goss.

That issue wasn’t investigated by Mr Carey, who said his reforms tackled the problem of sham leases as highlighted in the City of Perth inquiry.

Boundary setting is another major structural change tackled by all other states and territories since the 1990s that will be left untouched in this round of reform.

While Mr Carey doesn’t support forced amalgamations, Mr Michael’s report did suggest the creation of an independent commission to make decisions on the size and composition of the state’s local governments.

That was in part drawn from a similar model used in SA.

Mr Omodei raised this issue with the Legislative Council’s committee, suggesting a separate committee on structural reform examine anomalies within local government boundaries.

He highlighted the inherent inequity that arises between the likes of City of Wanneroo, which Data & Insights pegs as the second largest local government in WA by revenue with $201.7 million in 2021, and the Shire of Cuballing, which with fewer than 500 people has not had a primary school since the 1940s.

Ms Butterfield didn’t discuss boundary changes with Business News but did touch on inequity more broadly, suggesting the state government provide funding to assist smaller local governments pay down services and capital works.

Mr Graham, meanwhile, pointed out that local governments were unique in being allowed to determine their own boundaries, rather than having them set by an electoral commission.

“Why wouldn’t you have the electoral commission running electoral boundaries?” he asked.

“That’s what the organisation does. Why would we [not] let them do it in local government?”

Mr Carey was further pressed by Business News on why some of these suggestions had been left out while council dysfunction had been given such prominence.

“No-one is coming to me complaining about those things,” he said.

“I am a pragmatist who wants to focus on getting major reforms done to the Act.

“I would argue that our reforms focus on the key challenges that we need to deal with, and that delivers on those reforms.”