Posted on October 23, 2017 by Lindsay Taylor

ALERT – Consultation Draft of revised Model Code of Conduct for Local Councils in NSW released today for public comment

The Office of Local Government (OLG) has today issued consultation drafts of a revised Model Code of Conduct for Local Councils in NSW (Model Code) and revised Procedures for the Administration of the Model Code for Local Councils in NSW (Code Procedures), both of which are on public exhibition for the next six weeks.

Submissions on the draft Model Code and Code Procedures should be submitted before Monday 4 December 2017.

The new Model Code and Code Procedures are being introduced to give effect to changes foreshadowed by the enactment of the Local Government Amendment (Governance and Planning) Act 2016 (Amendment Act) in September 2016.

We previously blogged about the changes brought about by the Amendment Act here.

This blog provides an overview of some notable changes proposed in the draft Model Code and draft Code Procedures.

One of the major changes which the Amendment Act envisaged was the removal from the Local Government Act 1993 (LG Act) and Local Government (General) Regulation 2005 of provisions dealing with pecuniary interests. These provisions are now incorporated into Part 4 of the new Model Code. There are schedules to the Model Code dealing with disclosures of pecuniary interests. One notable addition to disclosure obligations is that  designated persons are required to declare whether they are a property developer or a close associate of a corporation which is a property developer in official returns of interest (see clause 4.21 and clause 19 of Schedule 1).

The media release by the OLG states that this will mean that the reforms will, once commenced, “consolidate the prescription of ethical standards for council officials into a single statutory instrument” and will mean that “breaches of the pecuniary interests  obligations by councillors are treated as misconduct …  and will be subject to the “three strikes” misconduct rules.”

The Model Code

In addition to the provisions regarding pecuniary interests, among the notable changes proposed in the draft Model Code are:

• clarification that conduct in good faith, whether or not it involves error, will not constitute a breach of fairness and equity obligations (see clause 3.5)
• there are new bullying provisions, but it is made clear that reasonable management action carried out in a reasonable manner does not constitute bullying behaviour (see clauses 3.8- 3.11)
• new standards requiring compliance with work health and safety obligations under the Work Health and Safety Act 2011 (see clause 3.12)
• new standards requiring disclosure of records of meetings and other communications with applicants and objectors to planning applications at the meeting at which the application is determined (see clause 3.15)
• new provisions regarding behaviour of councillors at meetings (see clauses 3.21-3.24)
• clarification of the types of relationships that might give rise to non-pecuniary conflicts, and reinforcement of the importance of perception (see Part 5)
• a requirement that council officials do not participate in competitions for prizes where eligibility is based on the council being in a customer-supplier relationship with the competition organiser and a prohibition against personally benefiting from reward point programs when purchasing on behalf of council (see clause 6.3)
• banning gifts or benefits greater than $50 from being accepted and introducing mandatory reporting of all gifts or benefits regardless of value (see clause 6.6)
• clarification that in relation to inappropriate interactions, a public forum includes social media (see clause 7.5)
• banning access to council information when councillors have a pecuniary or a significant non-pecuniary conflict of interest unless the information is otherwise available to members of the public, or the council has determined to make the information available under the GIPA Act (see clause 8.6)
• new standards regarding internet access and use of social media (see clause 8.20)

The Code Procedures

The draft Code Procedures have been amended to reflect that pecuniary interest matters are now dealt with under the Model Code. Other noteworthy provisions are:

• clarification on when complaints are not considered “code of conduct complaints” (see clause 4.2)
• clarification that complaints about the General Manager may be made to external agencies (see clause 4.11)
• a discretion for a General Manager or Mayor to delegate functions under Part 5 of the Code Procedures to a member of staff or persons external to council (see clause 5.1)
• clarification on when the Mayor or General Manager may decline to deal with a complaint at the outset (see clause 5.2)
• a new provision providing a procedure for dealing with a complaint about both the General Manager and Mayor (see clause 5.33)
• establishing additional complaints assessment criteria to be considered by a conduct reviewer in the preliminary assessment of a complaint (see clause 6.30)
• establishing additional sanctions which an investigator may recommend be imposed by a council if it is determined that conduct investigated constitutes a breach of the code of conduct (see clause 7.36)
• a prohibition against council inviting submissions from persons other than the person the subject of an investigation when considering a final investigation report and the sanctions to be imposed on that person (see clause 7.52)
• a requirement for a report to OLG to be given if Council does not adopt the sanctions in the investigation report (see clauses 7.60 – 7.62)
• a discretion for the General Manager to refuse to provide further information about a code of conduct complaint (with the consent of the OLG) if a complainant has publicly disclosed information about a code of conduct complaint that they have made or purported to make (see clause 12.2)

Next Steps

Once finalised, councils will be given a 6 month transitional period in which to adopt the new Model Code and Code Procedures and update their systems to align with the new requirements.

We will review the Model Code and Code Procedures over the coming weeks and comment in a further blog on some of the above changes in more detail.

Submissions on the Model Code and Code Procedures may be made by email to olg@olg.nsw.gov.au and should be labelled “Code of Conduct Consultation” and marked to the attention of OLG’s Council Governance Team.

Should you require any assistance in preparing submissions on the draft Model Code or draft Code Procedures, please contact Dr Lindsay Taylor on (02) 8235 9701 or by email at lindsay.taylor@lindsaytaylorlawyers.com.au