Mildura governance challenges, conduct panels, dog pounds and Tweets

May 17, 2011

Dear readers with an interest in local government,

as the Baillieu government contemplates the structure of its new anti-corruption watchdog and Justice Minister Andrew McIntosh claims it will show Brimbank was "the tip of the ice-berg", an interesting insight into council governance has emerged from Mildura.

The following story was published in Crikey today:

Mildura council bombshell: what will Karl Stefanovic say this time?

Stephen Mayne writes:

Gold Logie winner Karl Stefanovic copped plenty of flak when he declared that his wife, Cassandra Thorburn, has the "best a*se I have ever seen".

Karl doesn't mind talking frankly about the Thorburn family. When Cassandra's father, Max Thorburn, was ejected from his first meeting as a newly elected Mildura Rural City councillor in December 2008, Karl joked about the antics of his father-in-law to a national audience on Nine's Today show.

As of noon today, media of all persuasions will know a lot more about Mildura's council courtesy of an extraordinary whistleblowing effort by another councillor with a strong media pedigree.

Vernon Knight AM JP is the father of the ABC's Middle East correspondent Ben Knight.

After serving eight years on Mildura's council he resigned in disgust two months ago. Today he has released this comprehensive 120-page report called "Mildura: too good to spoil!" It's all nicely packaged up on a new website.

Victorian Deputy Premier Peter Ryan took time out from the crisis engulfing Victorian police commissioner Simon Overland and gave former Cr Knight a half-hour hearing last Tuesday to present his report.

The report goes chapter and verse into incidences of conflict of interest, inappropriate behaviour, inordinately large expense claims, planning controversies and the alleged failings of the existing legislative and regulatory tools to deal with code of conduct breaches.

Cr Knight did enjoy some early success when he engaged with those tools. After lodging a complaint, Cr Sue Nichols was placed on a six-month good behaviour bond for failing to declare a conflict of interest when she put up a motion in January 2009 calling for a new regional waste facility to be built at Mourquong, which is across the Victorian border in the NSW Shire of Wentworth.

The only problem here was that Cr Nichols double dips, serving on Wentworth Shire Council, which would obviously benefit from such a facility.

The other early scalp was Cr Mark Eckel who pleaded guilty in the Magistrates Court and ordered to pay $3000 for failing to declare he used to work for the community radio station run by Karl's father-in-law.

Cr Thorburn is a very active media player as he also runs the Mildura Independent newspaper. A complaint was made that he was using inside information from council for his controversial editorials and Cr Eckel voted against taking any action without disclosing his past employment by Karl's father-in-law. Amid of slew of other issues, former Cr Knight also raises that old chestnut of overseas councillor junkets to sister cities.

The Mildura councillors have given this a real work out over the past two years and ironically, Cr Eckel and Cr Nichols, are slated for another trip to Japan in October.

The report discloses some huge internet bills racked up on these overseas trips. Cr Eckel claimed $6667 for internet expenses on one trip to California and Cr Fiona Hilton-Wood slugged ratepayers with an internet bill of $11,246 after visiting Japan in 2009. This has only become public today.

Mildura's CEO Mark Henderson doesn't escape attention. He was the CEO of the bush-fire ravaged Murrindindi Shire in early 2009 who was savaged in the media for taking a two-week holiday shortly after the February 7 bushfires ripped through Kinglake.

Henderson subsequently moved to the other end of the state but will now be under fire again.

One of Vernon Knight's revelations concerns a development matter where the group he worked for, Mallee Family Care, lodged a planning application for a new office development.

The only objector was the secretary to the CEO before Mark Henderson, who is married to a senior planning officer at Mildura. They lived across the road from the development and despite being an objector, the senior planning officer still handled the negotiations with the consultant claiming to be only wearing his planning officer hat. Oh dear.

There's plenty more material such as that to chew over so check out the website, which only went live at noon today. King Karl should have a read and give his father-in-law another mention on national television.

The whole episode will prove to be useful insight into governance issues in local government and it may well encourage councillors across Australia to follow Vernon Knight's lead.

*Stephen Mayne is a Manningham City councillor who was not paid for this item


The council responds and some additional observations from Mildura

Mildura Rural City Council CEO Mark Henderson has just released the following statement responding to the report and Vernon Knight's well attended press conference held at noon today:

I'm aware of Mr Knight's allegations as many of them were raised with me and the Council's previous Audit Committee Chair last year. At the time I advised Mr Knight that I felt the matters raised were more a matter of personal discontent and did not materially affect the governance of the Council. I encouraged him to raise the matters formally with me or Local Government Victoria but never heard anything further from him. It's a shame that Vernon didn't deal with his concerns whilst he was a Councillor as his declaration of office required him to do.

If you read Vernon's report, it is clear that he did try to deal with many of the issues but was disappointed by the response he got from people such as the Chief Municipal Inspector, David Wolf.

A similar sentiment was expressed by Manningham Cr David Ellis when David Wolf attended our council to explain why a prosecution wasn't launched against our former deputy mayor on two conflict of interest matters.

I thought David Wolf acquited himself quite well in his half hour presentation at Manningham and was sympathetic to his arguments about the heavy burden of proof for a criminal prosecution.

Meanwhile, this is what we wrote about the whole councillor behaviour and governance question in our April 27 edition:

Councillor Conduct Panels and Manningham's precedent setting VCAT appeal

After a series of scandals involving bad behaviour by local councillors, the former Victorian Labor Government finally acted in 2008 when it introduced some sweeping changes to the Local Government Act.

The Municipal Inspector was created to criminally prosecute those councillors who broke the law and a tool known as Councillor Conduct Panels were established to allow relatively low cost and lawyer free hearings into alleged breaches of council codes of conduct.

So far there have been five panel reports into alleged breaches of the code of conduct which have rolled out as follows in chronological order:

Warrnambool: Five councillors, led by mayor Michael Neoh, took action against Cr Peter Hulin for leaking confidential information to The Warrnambool Standard that a Melbourne builder had been awarded the contract to build the Warrnambool Harbour Pavilion project when a local competitor was only $35,000 more expensive. The journalist gave evidence at the one day hearing and Cr Hulin was reprimanded, ordered to apologise and required to take media training plus find a local government mentor for 12 months. In political terms, the proces has arguably made Cr Hulin even more popular as he has been seen to be standing up for local business. Read the full 6-page panel report released in October 2009.

Moira Shire:
Mayor Ed Cox instituted a panel against Cr Garry Jones for urging traders to call for a log cabin to be removed from a shopping strip when he allegedly should have known that this removal was not necessary to get the proposal moving ahead. Read the 4-page panel report released in July 2010 which cleared Cr Jones saying his communications were robust but did not constitute a breach of the code of conduct.

Bayside: A female councillor, Felicity Frederico, initiated a panel against former mayor James Long over a derogatory comment allegedly made at a council meeting relating to the appointment of a female local government ambassador. The complaint was dismised as "lacking in substance" as a point of order wasn't even called at the time. Read the full 10-page panel report released in July 2010.

Manningham: former deputy mayor Fred Chuah was found guilty of three counts of misconduct and ordered to apologise to the council and a fellow councillor over comments made and his role in the attempt to triple the size of the nursing home he chairs in a Green Wedge zone. Rather than apologise he resigned, citing ill health and is now appealing the findings at VCAT. Read the full 40-page panel report released in November 2010.

Greater Dandenong: a two page panel report released on December 7, 2010, which reprimanded Cr Maria Sampey for calling Cr Angela Long a "b*tch" at a council weekend treat and stating that she "did not have a brain" during a council meeting. Both comments were heard by other parties and the panel formally reprimanded Cr Sampey and ordered she take some remedial training. This sort of effort will probably get Cr Sampey on our coming list of the 50 Victorian councillors who should not be re-elected in 2012.

How a Family First candidate and Nillumbik councillor beat the panel process

Councillors subjected to a panel have the option of taking the matter straight to VCAT and that is what Belinda Clarkson did to Nillumbik earlier this year.

The Nillumbik action was to be taken by the council as a whole, rather than individual councillors, but the mistake they made was loading up too many separate charges. Council pays the legal costs for all parties at VCAT, so Cr Clarkson could have hired a QC for $8000 a day to battle away over every last point in a hearing which was tipped to last more than a week.

Faced with a potential 6 figure legal bill, Nillumbik walked away.

Cr Clarkson was the Family First candidate for McEwen at the last Federal election and will definitely be on the list of councillors who should retire at the 2012 elections.

Fred Chuah blazes the trail with VCAT appeal

Compared with everything you've read above, former Manningham deputy mayor Fred Chuah has blazed a path-finding trail where no-one else has feared to tread over the past 15 months.

To start with, he used a QC to argue for legal representation at the panel hearings which were designed to be informal lawyer-free forums to resolve disputes. Whilst he was allowed to have counsel in the room during the 4 days of hearings, the lawyer wasn't running the show so it didn't impede the free flow of exchanges.

Fred Chuah's 40-page panel report was longer than the other 4 panel reports combined. Unlike all the precedents, Fred Chuah decided to challenge the findings in VCAT after the exhaustive hearings.

And he's doing so from the position of a being former councillor, which means there aren't exactly any sanctions which VCAT can apply.

There was a directions hearing before senior panel member John Billings at VCAT on Friday. Mr Chauh's lawyers sought an adjournment of the hearing on the grounds of ill-health.

VCAT previously determined that the two Panel Members, barrister Peter Harris and former Yarra councillor Jenny Farrar, were to be the respondents. However, they do not believe that they should be active participants in the review but should simply agree that they will abide by VCAT's decision.

This raises the obvious question of who will be the contradictor in this important precedent setting first CCP appeal at VCAT.

The original action was taken by Cr David Ellis, with Crs Grace La Vella and Stephen Mayne joining later in the proceedings. Crs Ellis and Mayne have expressed an interest in being joined as co-respondents, but were a little reluctant on being told the panel members who made the original decision were seeking to be excused.

At the hearing on Friday the tribunal granted an adjournment to 3 June. The tribunal also directed that Crs Ellis and Mayne prepare written submissions in relation to them being joined as parties by 20 May. Mr Chuah's lawyers then have until 27 May to consider the submissions and to put in writing their position on joinder. The parties were also requested to meet to establish matters on which they could agree (in relation to the way the matters may proceed) and where agreement is reached to forward this to VCAT as a proposal of consent.

In other developments, the service provider which Fred Chuah chairs continues to sue Crs Ellis and Mayne for defamation in the Victorian Supreme Court as was explained in our March 25 email edition.

Minor governance matter at Manningham involving dog kennels

Since Fred Chuah resigned last December, things have really settled down at Manningham and the council is operating well.

The only minor issue which popped up recently was a councillor utilising the council pound as a kennel for her three dogs when she went on holiday.

The local paper produced this story on the issue last month which began as follows:

Manningham Council has admitted a decision to allow a councillor to use the municipal pound as a kennel for her dogs last year was a mistake. Cr Meg Downie last week denied she had abused her position by boarding three of her dogs in the Doncaster East pound in April.

Members of the public are only allowed to keep dogs there in emergencies. Manningham director of environmental amenity Paul Molan said Cr Downie was given access to the pound by a council officer “who did not have approval to authorise this and did not realise it was contrary to policy”.

Mr Molan said Cr Downie was charged $276 for the service.

etc etc

The Manningham Leader further clarified the matter this week when it published this letter from a dog-loving friend of Cr Downie called Cara Beed:

Man's best friend is rewarded with kindness

For many years Manningham councillor Meg Downie has worked tirelessly for the welfare of animals in the municipality.

Cr Downie positively addressed the issue of dog kennelling by pioneering an additional income opportunity for the council pound through legitimate questions of the staff. That the experiment cost her more than her regular kennels shows Cr Downie was far from seeking personal gain. May her good work for animal welfare continue in strength.


Whilst Cr Downie at first didn't pay to utilise the pound, she graciously paid up when asked and it is re-assuring to know this issue wasn't a case of an entitlement culture or inappropriately deriving a benefit from council resources but was instead an animal welfare experiment designed to pioneer an additional income opportunity for council.

Having just flagged a 5% rate rise for 2011-12, it is good to see hard working councillors such as Meg Downie are indeed exploring all possible income opportunities for council.

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Click on the image above to join more than 4200 followers on Twitter. We are regularly dropping out observations about journalism, politics, breaking stories, local government and shareholder activism. Here are some recent Tweets:

May 12

A big Steve "Half" Price apology to Hinch:

And respected former Mildura councillor Vernon Knight even has this dedicated website to back it all up:

Ben Knight's father Vern Knight has just dropped this bombshell on Mildura:

Have just submitted a letter to The Oz pointing out hypocrisy of calling for reductions in middle class welfare & then attacking specifics.

Leighton & Southern Cross capital raisings again demonstrate how retail get shafted when their shortfall offer is done after insto bookbuild

Will Swanny's broken glass become like John Kerin's 1991 gross operating surplus bungle - an excruciating and damaging TV moment.

Amusing that Murdoch advocates small govt & his tabloids are hysterically defending middle class welfare with this "150k is rich" rubbish.

May 11
The decision to not fully fund the Future Fund by 2020 is a broken promise by Labor that amounts to many tens of billions of dollars.

The Gillard surplus claim is a ruse based on starving the Future Fund of contributions & allowing unfunded super liabilities to blow out.

Crean announces Manningham tops for "promoting reconciliation":

May 10
Just sold 10k worth of shares in local Bendigo community bank at cost to a former mayor so won't have a conflict promoting inside council.

See AFR's p3 hit on former reporter Matt Coghlan for getting payout from Swan's office & returning as Swan's spinner. He said: "no comment".

Off to lunch in town with a chair of two ASX200 companies. Has some specific issues to raise so should be interesting.

That's all for now. Send any feedback to and, remember, just do ya best.

Stephen Mayne

* The Mayne Report is a multi-media governance website published by Stephen Mayne with occasional email editions. To unsubscribe from the emails click here.