The NSW Government has ordered a public inquiry into the Liverpool City Council after a scathing report outlined serious concerns about widespread dysfunction and maladministration within the council.
The Minister for Local Government Ron Hoenig has also written to Liverpool’s mayor, saying he intends to suspend the council and postpone elections due in September while the inquiry is being conducted.
The council has been given a week to respond.
An interim report tabled with the minister last week detailed various “areas of concern” including recruitment and staffing practices, procurement irregularities, allegations of inappropriate record keeping and “widespread evidence of a toxic work environment”.
Authored by deputy secretary of local government Brett Whitworth, the report said that based on an extensive document discovery and review process as well as interviews with current and former staff, investigators believed “there is a strong likelihood there are additional issues impacting the operations of the council”.
The scope of three-month investigation—announced in April under Section 430 of the Local Government Act of 1993—focused largely on recruitment matters, however, the government said “investigators had identified matters sufficient in seriousness and volume to warrant an immediate public inquiry into the Council”.
In announcing the further inquiry, Hoenig said communities expected their council to be operating with the highest level of integrity and in their best interests.
“It has become clear that is not the case at Liverpool City Council and there is major dysfunction across the entire organisation,” he said.
“These are very serious issues which are causing distress among staff and impacting the council’s ability to deliver for its community, and they must be urgently addressed.
“A public inquiry is therefore a necessary measure to get all the issues out in the open and start the journey of restoring confidence in the council.
“I want to ensure the commissioner can oversee this inquiry without the politically charged environment of an election, which is why I believe it is in the public interest to postpone the September elections for Liverpool.”
With a municipality-wide population of just under 250,000, Liverpool City Council is the ninth biggest in NSW.
Online records show total residential building approvals reached 2528 in the 2022-23 financial year.
In announcing the city’s $280-million operating budget in May this year, Mayor Ned Mannoun forecast a modest surplus of $3.9 million, with a record high spend of $177.7 million on capital works.
He said at the time the budget would employ more staff to ensure council services could meet the expected 58.4 per cent growth in population by 2041.
However, concerns with the council’s recruitment process were raised as far back as December, 2022 when the-then Minister for Local Government Wendy Tuckerman received a complaint about process around the appointment of the council’s chief executive John Ajaka.
Liverpool City Council residential building approvals
Ajaka, a former NSW Liberal minister, in June this year became the council’s 10th permanent or acting chief executive to be sacked in eight years.
“It was a revolving door of chief executives and directors,” a former mid-level manager told The Urban Developer on condition of anonymity.
“It was throughout the whole council—toxic leaders appointing toxic directors who did not know what they were doing,” she said. “It was a complete shit show.”
She said the situation had become so bad people were having nervous breakdowns.
Those comments were borne out by a three-person investigation team, led by Office of Local Government director of investigations Brad Wade.
The report said it was apparent a significant number of positions, at all levels and in various directorates within the council, had been filled based on factors other than merit.
“Such factors include the employment of undeclared family members, close associates, and politically affiliated persons,” the report said.
Investigators identified such links in a variety of senior positions, including the chief executive role, directors, senior advisors and senior planners.
“Multiple staff interviewed described a ‘toxic culture’ within the council, where bullying, intimidation and sexual harassment occurred without such matters being appropriately addressed in a timely manner,” the report found.
The investigators heard allegations of the destruction or removal of records. At one point during the investigation, they were so concerned about potential breaches, the council's acting general was asked to “remind council staff of the importance of maintaining records.”
The report says those allegations are as yet unproven.
The government has appointed Ross Glover as the commissioner to lead the inquiry. In 2021 Glover undertook a similar inquiry into Wingecarribee Shire Council, also in NSW.
Liverpool council said it would not be making any comments about the report or the government’s public inquiry.
