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A $1.49 million debt will be written off by Orange Council, after a vote held behind closed doors

June 13, 2023

By Peter Holmes

A $1.49 million debt will be written off by Orange City Council, and the residents and ratepayers of the city will never know how the debt was accrued, by whom, and why it was written off.

While considerable detail about Orange City Council’s finances is available for public perusal, significant council business is also conducted behind closed doors, as per legal requirements.

Councillors become privy to all manner of private goings on, and they are banned from talking about them.

The $1.49 million figure was revealed in minutes from OCC’s May 16, 2023 meeting, which were published in the agenda from last Tuesday’s meeting (June 6, 2023) under the heading “Resolutions From Closed Meeting”.

The papers recorded that council resolved on May 16, 2023 to “adjourn into a Closed Meeting and members of the press and public be excluded from the Closed Meeting...".

When the councillors go into the Closed Meeting section of the fortnightly meetings in the Orange City Council (OCC) chambers, the public must leave the gallery.

The feed on YouTube is cut and smooth jazz is piped. The feed returns once the Closed Meeting has concluded.

The circumstances surrounding the $1.49 million debt were not published. This was because, according to the council minutes, such detail would “confer a commercial advantage on a person with whom it is conducting (or proposes to conduct) business”.

The minutes from May 16, 2023 stated that a Closed Meeting resolution was put and seconded by councillors Jack Evans and Glenn Floyd. The resolution was: “That Council adopt and write-off the outstanding debt for Debtor account 5156.90 in the sum of $1,490,155.38.”

That was it. No other information was provided, leaving the residents of the city completely in the dark as to why OCC was going to wipe the slate on such a large sum of money.

Council minutes.

The papers showed that all 12 councillors - Hamling, Duffy, Evans, Floyd, Greenhalgh, Kinghorne, Mallard, McDonell, Mileto, Peterson, Power, Whitton - voted for the write-off.

There is absolutely no suggestion that there was anything untoward about the process - governments on all three tiers do things in the shadows (see list below) all the time.

They are bound by laws regarding privacy, legal proceedings and commercial confidentiality that they must abide by.

The state Office of Local Government guidelines say that “where a council official fails to comply with their obligations in relation to the protection of confidential information they may face disciplinary action. This might include termination of employment for council staff or suspension or disqualification from civic office for a councillor”.

However, the $1.49 million write-off illustrates how large sums of money can be in play without the people funding it having access to much detail. It goes to the issue of transparency, to what extent the public has a right to know, and to whether every single item dealt with in Closed Meetings actually needs to be there. How would we know?

[In researching this story it became apparent that some resident and ratepayer groups around the country believe too many decisions are made in private.]

The same May 16, 2023 minutes contained another matter from the Closed Meeting. It was related to a legal issue dating back a decade between OCC and the company Hewatt Pty Ltd. It is believed the company had been engaged by council to build a roadway between Orange and its airport.

The council business was conducted in private under the Local Government Act “which permits the meeting to be closed to the public for business relating to (g) advice concerning litigation, or advice that would otherwise be privileged from production in legal proceedings on the ground of legal professional privilege”.

Council papers.

Councillors are advised in the papers: “Information contained in this paper is subject to legal professional privilege and is strictly confidential.

"Any disclosure of this paper, including a verbal disclosure of its content or conclusions, beyond Council officers directly involved in this matter may result in the loss of legal professional privilege and cause damage to the Council’s legal and financial position.

“Councillors have a good faith duty to strictly maintain confidentiality of privileged communications...”

A motion moved and seconded by councillor Jeff Whitton and deputy mayor Gerald Power stated that “Council’s Chief Executive Officer be given delegated authority to settle the outstanding legal matter between Council and Hewatt Pty Ltd based on the information presented within the body of this report”.

It was again passed with a vote of 12-0.

According to the state Office of Local Government: “Meetings are the key forum in which councils make strategic and policy decisions on behalf of their communities.

"As elected institutions, councils are ultimately accountable to their communities for their decisions. It is therefore important that council meetings are open and can be attended by members of the community.

“However, there will be occasions where councils are required to consider information which, by its nature, is confidential and ought not to be publicly disclosed.

“The Local Government Act 1993 (the Act) recognises that on such occasions, the public interest in protecting confidential information will outweigh the public interest in ensuring accountability through open meetings.”

Examples are given:

  1. Personnel matters concerning particular individuals (other than councillors);

  2. The personal hardship of any resident or ratepayer;

  3. Information that would, if disclosed, confer a commercial advantage on a person with whom the council is conducting (or proposes to conduct) business;

  4. Commercial information of a confidential nature that would, if disclosed:

− prejudice the commercial position of the person who supplied it, or

− confer a commercial advantage on a competitor of the council, or

− reveal a trade secret;

  1. Information that would, if disclosed, prejudice the maintenance of law;

  2. Matters affecting the security of the council, councillors, council staff or council property;

  3. Advice concerning litigation, or advice that would otherwise be privileged from production in legal proceedings on the ground of legal professional privilege;

  4. Information concerning the nature and location of a place or an item of Aboriginal significance on community land;

  5. Alleged contraventions of the council’s code of conduct.

“In order to close a meeting to the public, a council or committee must be satisfied that the matter or information being discussed or received falls within at least one of the above grounds,” the Director General’s guidelines stated.

However the guidelines also make clear that “the existence of any of these grounds does not place any obligation on a council to close its meeting to consider a matter or information, (though in many cases, it would be appropriate for it to do so).

“It simply permits a council to do so. In the case of most of these grounds, the council will also need to demonstrate why it is in the public interest to close the meeting to discuss the matter or information.”

Under the Government Information (Public Access) Act 2009 (the GIPA Act): “Where a council receives a request for access to a confidential business paper under the GIPA Act it must comply with the provisions of that Act.

"This means that it must be decided whether there is an overriding public interest against disclosure which outweighs the public interest in favour of disclosure.” That decision is made by council.

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