Investigation summaries

Council has been reviewing its Conflict of Interest Policy in accordance with the provisions of the Local Government Act 2020 and in respect of the specific points outlined in IBAC’s correspondence.

In relation to supervisors understanding their obligations to actively and effectively manage the conflicts of interest of the employees and contractors they manage, Council has revised its Conflict of Interest Policy which includes a section on managing conflict of interest as well as detail regarding the responsibilities each of – staff and contractors, managers and supervisors, suppliers and the internal Governance Unit. In relation to employees and contractors understanding their obligations to identify, declare and manage conflicts of interest, Council refers to guidance provided in the revised Conflict of Interest Policy related to identifying and declaring conflicts of interest. Council also provides induction and follow up training of staff in relation to conflicts of interest as referenced in its Staff Code of Conduct.

In relation to recording and communicating any conflict of interest declarations and associated management plans to relevant supervisors, Council notes that sections 4 and 5 of the revised Conflict of Interest Policy list specific responsibilities of the Council’s Governance Support Unit, which include:

• maintaining a register of conflicts of interest declarations made and included on the register
• ·notifying management of every conflict of interest declaration made and included on the register
• ensuring the conflict of interest register is available only to line management and to others where required by law (such as the Local Government Inspectorate)
• issuing a reminder to all staff at least twice each year of their obligations to declare conflicts of interest in accordance with this policy
• periodically reminding line managers of the existence of declared conflicts and reinforcing control measures
• reviewing the Conflict of Interest Policy in accordance with the policy review cycle.
   

In addition, Council is developing a process for an annual attestation by managers in relation to a number of governance, compliance, finance and risk matters. It is proposed that managers will be required to submit an annual declaration in relation to the management of conflicts of interest, commencing July 2021.

In relation to risk management around Council’s engagement of companies or other suppliers in which Council employees or contractors have an interest, the measures Council has adopted include:

• Council’s revised Conflict of Interest Policy.
• Council’s Staff Code of Conduct (Code), the purpose of which includes setting out Council’s expectations of staff at all levels in performing duties or acting on behalf of the Council.
  • The Code sets out a consistent approach to, and common understanding of, the behaviours, standards, values and ethics required in all work activities, including Conflicts of Interest.
  • The Code is available for all employees to access on Council’s internal intranet site.
  • All new employees are provided a copy of the Code as a component of their contract of employment and are required to sign off on the policy. These details are filed in their personnel file.
  • All new employees are required to complete various e-learning modules at the commencement of their employment and at periodic intervals thereafter. One of the e-learning modules specifically relates to the Code.
  • All new employees are required to attend a Corporate Induction and at this session a member of the HR Services team attends and provides an overview of various HR related matters and specifically addresses the expectations of employment at Council, including reference to the Code.
  • On-site departmental inductions are also undertaken for new employees and contractors by the Branch Managers and People Leaders. These inductions include reference to the requirement to abide by all Council policies including the Code.
  • Council is implementing a process to issue a reminder to staff twice each year about the existence of the Code, which will request that all staff re-familiarise themselves with the Code and their obligations under the Code. The reminder will include a brief note about what the Code requires of staff and the particular aspects of the Code to which they should refer.
  • The Code is also embedded into various aspects of Council’s corporate values. The Council’s values are continually referred to in the way Council approaches its work and its dealings with the community.
  • The Code is enforced by all people leaders at Council and any staff member who does not abide by this policy is promptly and respectfully reminded of their obligations.
  • Depending on the severity of the breach the matter may be referred to Human Resources and an investigation may occur. Any substantiated breaches of the Code may result in disciplinary action and this may also involve termination of employment. All employees are provided procedural fairness through any such formal process.
  • Every three years, employees are required to undertake a refresher e-learning training session in the Code.
     

Regarding the management of procurement, any officer who participates in the assessment of a tender or purchasing process is required to firstly complete a written confirmation that they have no conflicts or potential conflicts of interest with any of the tendering parties. The processes are as follows:

(i) Prior to a Pre-Tender Meeting, all staff involved in the process (i.e. panel members) must firstly complete a Confidentiality Declaration Form. The panel is not permitted to have any knowledge of the contents of the specifications, budgetary figures or any other information deemed to be confidential until completion of the Declarations.

ii) When tender submissions are received on the tender closing date, the relevant Procurement Officer (Facilitator of the tender panel) generates a Code of Conduct document which must be read and a Conflict of Interest form which must be signed off, by each panel member including the Procurement Officer. Subject to signing of the Conflict of Interest form, the Tender Panel members are then given access to the tender submissions which are located in the Official Content Manager System.

Council reviews and updates its procurement policy annually. The 2021 review will include a focus on ensuring full compliance with the requirements of Local Government Act 2020. Council will be adopting a new fully updated Procurement Policy by the end of the 2021 calendar year. This work is underway and utilises Local Government Victoria resources, including their best practice guidelines and the preface to those guidelines.

With regard to procurement processes, there are several points at which Council must be notified of any potential conflicts of interest between a contractor and associated persons/organisations concerning the contract, separate from the ‘staff notification’ of a conflict of interest.

Sub-contractors are currently dealt with in the Tender Information and Conditions of Tender which specifically addresses the matter of identifying conflicts of interest which exist between the contractor and sub-contractors.

Tenderers are required to provide specific details as to how they intend to manage sub-contractors that are to be engaged in the works. Details must include the processes that will be put in place to ensure that the sub-contractors will align with all criteria required of the contractor including the Tenderers Quality, Environmental and Health and Safety Management Plans. If there appears to be any anomalies with the listed sub-contractors, the Tender Evaluation Panel would raise it either in a written query or at interview.

The AS2124-based contracts used for building projects require the written approval of sub-contractors by the Superintendent, where ‘approval shall not be unreasonably withheld’ (section 9.2). The Council is intending to incorporate a similar clause into its Procurement Policy requiring all contractors (in new contracts) to advise and obtain Council approval for any sub-contractor they use. This will assist the oversight of procurement procedures as referenced in the Conflict of Interest Policy.

The Council also has conflicts of interest clauses in its Conditions of Contract for Services, Consultancy Services and for ICT Consultancy Services to manage potential conflicts between contractors and sub-contractors.