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The Local Government Act 2020 (the Act) was passed by the Victorian Parliament in March 2020, replacing the Local Government Act 1989. This is the most significant reform to the local government sector in over 30 years.
The first phase of reforms introduced the overall architecture of the new Act without any council obligations, except those that relate to elections.
As part of Stage 2 all Victorian councils are required to have a Councillor Expenses Policy adopted by 1 September 2020.
The feedback gathered on the interim policy will be presented to the new Council for consideration before it formally adopts the Councillor Expenses and Support Policy.
The key objectives of the Council Expenses and Support Policy developed by Council are to:
- ensure Councillors have the support and knowledge they require to properly discharge their civic responsibilities, given they are elected to voluntary, part-time roles in the community
- ensure that Councillors and members of delegated committees and the Audit and Risk Committee fully understand the responsibilities and obligations they must uphold to receive reimbursement of expenses and support
- encourage diversity and participation as Councillors from the broadest cross section of the community by reducing barriers to participation
- ratify Council’s compliance with the Local Government Act 2020.
The Councillor Support and Expense Reimbursement Policy was adopted by Council on 28 June 2016. Officers commenced a formal review of the Policy in 2019 and finalised a draft policy earlier in 2020, however presentation of this report was deferred while an internal audit was undertaken on this matter which is not yet complete.
Council’s auditors were engaged to:
- undertake an internal audit to, among other things, assess the design of and adherence to the key controls for Council Expenses, including compliance with the Councillor Expenses and Support Policy
- where possible, identify opportunities to improve the Councillor Expenses and Support Policy, and structure and operation of the procedures and controls.
A final report on the Audit has not yet been received and some elements of the audit are still being finalised. Officers have been provided with the parts relating to the policy to enable Council to execute its statutory obligation to adopt a Policy by 1 September 2020. A public report will be provided on the matter once the Audit is complete which summarizes the audit scope, findings and management actions.
Among other things, the Audit assessed the updated draft policy (Feb 2020) and found it reflects many of the improvements required. Some additional elements were suggested to further strengthen the document, which has resulted in further material changes being made to the following parts of the interim policy including:
- Mayor and Councillor allowances
- communication equipment
- monitoring of expenditure
- form of claims
- assessment of claims
- reporting requirements.
View the policy review timeline on the right.
The interim Policy has been updated to reflect the new requirements of the Act, including specifically to:
- give consideration to the support that may be required by a Councillor because of a disability
- have particular regard to the support that may be required by a Councillor who is a carer in a care relationship within the meaning of the Carers Recognition Act 2012.
Additional key elements of the interim policy include:
- a clearer statement of why the policy is required and what it sets out to achieve
- a clearer definition of official Council business
- a more holistic view of the various support and expenses that Councillors can access
- inclusion of an hourly rate cap for carer and childcare expenses, subject to available budget funding
- clearer criteria for accessing professional development and training opportunities
- greater clarity for travel associated with the Greater Melbourne area
- a clearer definition of technology and communications support
- clearer forms for claim of expense or seeking reimbursement
- timeframes limiting the claim period for reimbursement
- reporting requirements which include a quarterly report published on Council's website, as well as being tabled at an Ordinary Council Meeting, and reports being provided to the Audit and Risk Committee.
Local Government Act 2020
The new Local Government Act 2020 aims to support closer relationships between councillors and their communities by removing unnecessary prescriptive details from regulatory and legislative requirements of councils.
Recognising this level of prescriptive detail is unnecessary for modern councils, this new Act reflects a more principles-based approach to how councils operate, including how they:
- make decisions
- conduct public consultation processes
- provide notices of meetings
- run meetings
- make information available to the public.
Development of the Local Government Act 2020 has been guided by five principles:
- Community engagement
- Strategic planning
- Financial management
- Public transparency
- Service performance.