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Probity demand from Moira ratepayers

As Moira Shire Council enters further turmoil over management of its finances, residents are holding an urgent meeting tonight to demand an independent probity audit.

ROB HENSON June 18, 2014 3:36am

As Moira Shire Council enters further turmoil over management of its finances, residents are holding an urgent meeting tonight to demand an independent probity audit.

The agenda for the Nathalia meeting is to form a petition demanding council to institute an independent probity audit immediately.

It comes after the Local Government Inspectorate confirmed it would investigate a breach of confidentiality after an internal audit of contracts management was leaked to the media.

The leaked audit found council potentially faced 42 breaches of the Local Government Act by awarding contracts worth more than $150000 without a tender process.

Residents voiced concerns at a budget submission hearing on the 2014/15 proposed budget on Tuesday last week at Cobram Civic Centre.

‘‘I don’t consider that the budget is viable, because we haven’t had our independent probity audit, which was unanimously voted for by council,’’ resident John Lycett said.

‘‘I consider the politics of council to be basically corrupt or incompetent,’’ Mr Lycett said, to applause from the public gallery.

The independent probity audit, set to report on council’s ‘‘fiscal and operations’’ functions is still an active resolution. But the audit was put on ice as legal advice highlighted shortcomings in the council’s procurement process in selecting the probity auditor.

Council chief executive Mark Henderson said the recently leaked audit on contracting was itself ‘‘a form of probity audit’’.

‘‘If you asked for a probity audit one of the things that should be included (is) contracts.’’

He said he did not believe any contractor had been overpaid by council.

‘‘I think people have had contracts in place, and during the course of flood events, tornadoes and other natural disasters... and rather than go under another tendering process, we’ve said ‘you’re in that area, continue working to get the job done’.’’

Mr Henderson said the flood damage repair bill, paid through grants, was initially estimated to be $20 million, then ballooned out more than threefold.

‘‘So if you go in with a contractor and say ‘clear the roads, get things moving again’, and while he’s there you realise the job is much bigger than you ever imagined, you’re going to keep them working.’’

‘‘Technically, yep, we should have said, ‘the job is much bigger than we thought’ and it should have gone to tender. But when you’re doing emergency recovery, you don’t sit on your hands for six weeks to go through a tender process.’’

Some of the potential breaches identified in the leaked report were where repeated purchases had amounted to more than $150000.

‘‘If across the course of a year we would buy, for example, half a dozen cars from Toyota, the aggregate value of those cars will be more than $150000. Now technically we should have a contract to cover all of those purchases. In reality we’ve got a government contract price, which we’ve got whenever we want to buy a car.’’

Mr Henderson apologised to tenderers who had been brought into the controversy through media reports on the leaked document.

He said some media reports had ‘‘misinterpreted’’ the document by implying a local contractor was overpaid $1.8million in uncontracted payments.

‘‘There’s no way he received $1.8million without a contract. Did the contract exactly match $1.8m? No, probably not.’’

The community meeting is set for 6.30pm for a 7pm start at the Dancocks Room at the Nathalia Sports and Community Centre.

More budget coverage, pages 2 & 3.

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