LOCAL GOVERNMENT (ACCOUNTABILITY FRAMEWORK) AMENDMENT BILL

Second Reading

Second reading.

The Hon. J.M. RANKINE (Wright—Minister for Families and Communities, Minister for Northern Suburbs, Minister for Housing, Minister for Ageing, Minister for Disability) (16:18): I move:

That this bill be now read a second time.

I seek leave to have the second reading explanation inserted in Hansard without my reading it.

Leave granted.

Councils have a significant role in people’s lives. They are an important sphere of government, and like other governments have responsibilities and powers which enable them to provide services to support the smooth running of their communities. To carry out their duties they have the ability to impose rates, power to make and enforce laws, and to issue orders binding land owners. However the authority entrusted to councils as local governments must be exercised in the public interest, and councils must be accountable for its exercise.

As councils receive monies from the public (through rates and expiation fees), they must meet the standards of accountability applicable to public administration and management of public funds. Likewise the elected council members and their appointed officers must maintain high standards of probity that apply to holders of public office.

In recent times, concerns have been raised about:

aspects of the legislative framework to ensure that councils meet those standards; and

specific instances of failure to meet those standards that may indicate systemic operational problems in some councils.

In December last year, a proposals paper: Reforms to Improve the Accountability Framework for Local Government in South Australia was distributed.

This paper outlined proposals to amend the legislative framework for internal and external review of council administration and financial management. These proposals, in turn, built upon earlier legislative amendments (enacted in 2005, that took effect in 2007). These changes aimed to improve council financial management and accountability, and included the introduction of compulsory audit committees, long-term financial plans and infrastructure and asset management plans, and consultation requirements for a council’s annual business plan.

Many helpful submissions were received in response to this proposals paper, and the Government thanks all those who contributed their comments. This Bill, developed as a result of that process, deals with a number of matters that fall under the general umbrella of the local government accountability framework.

The Bill also contains unrelated, miscellaneous measures, most of which were the subject of consultation in a draft Local Government (Miscellaneous) Bill. The content of that earlier draft Bill has been included in this Bill. As a result this Bill contains a number of technical amendments.

This speech outlines first the accountability framework measures before turning to the other miscellaneous measures.

Accountability Framework measures

'Good public administration'

In addition to the fundamental obligation to act lawfully, there are established standards of good public administration which the public is entitled to expect of governments and public officers. These are based on administrative law principles and the work of Ombudsman and review bodies. This Bill seeks to amend section 8 of the Act to emphasise that a council must achieve and maintain standards of good public administration. The matters in section 8, currently described as objectives of a council, are expressed as principles that a council must observe in performing its roles and functions, and a new principle relating to good public administration is added. Another principle included in section 8, (and I thank the Local Government Association for this suggestion), is ensuring the sustainability of the council’s long-term financial performance. This principle is expected to reinforce the work that is being done in the Local Government sector to educate and support councils in this area.

Proposed amendments to section 59 place responsibility on the council’s elected members, as the governing body, to ensure, as far as is practicable, that the principles in section 8 are observed by the council.

Proposed amendments to section 132A require councils to ensure that appropriate policies, practices and procedures are in place in order to achieve and maintain standards of good public administration.

Widening the scope of audit

One of the main reforms sought by this Bill is a widening of the scope of an auditor’s duties. The former Auditor-General drew attention to the fact that the scope of council audits is narrower than that of State Government departments and instrumentalities under the Public Finance and Audit Act 1987.

The Bill therefore deals with this matter by providing that a council auditor must, in future, perform two separate functions. In addition to the existing audit of the council’s financial statements, proposed amendments to section 129 provide that the auditor must now also examine 'the controls exercised by the council in relation to the receipt, expenditure and investment of money, the acquisition and disposal of property and the incurring of liabilities' and provide an audit opinion as to whether the controls are sufficient to provide reasonable assurance that the financial transactions of the council have been conducted properly and in accordance with law.

In layman’s terms, this means that the auditor is not just examining where the money went, but also how a council controls public money; whether its management systems are sufficiently robust and prudent to prevent or detect fraud, wastage, inefficiencies and so on. The purpose of auditing controls is to increase confidence in the way public finances are managed. It is not sufficient that public money is managed well—it must also be seen to be managed well. Therefore the auditor will be required to check not only the use of public money, but also the systems of control that a council uses to manage public money.

Transitional provisions in this Bill seek to introduce this reform as soon as possible for metropolitan councils, bearing in mind the fact that each council already has a contract with an auditor. Councils outside the metropolitan area will be given an additional three years to comply with this provision.

Both the audit opinion with respect to the financial statements and the audit opinion relating to the sufficiency of internal controls will accompany the council’s financial statements. Further, even the customary audit management letter that provides technical advice to council management is also to become a public document, after the council has had 60 days to consider and respond to it.

The amendments to section 129 would also expand the matters on which a council’s auditor must report to the Minister, to include the reasons for any adverse or qualified audit opinion and any matter that in the auditor’s opinion ought to be reported to the Minister. The Act already provides that the Minister may, on the basis of a report of an auditor, appoint an investigator to carry out an investigation under section 272, and the investigator may be the Auditor-General.

Purpose of council policies and procedures

To support councils to meet standards of good public administration, the existing requirements for councils to have policies in key areas have been reviewed to ensure that the objectives for those polices are clear.

Therefore, three clauses of this Bill insert over-arching principles into the relevant sections of the Local Government Act.

Proposed amendments to section 48 would create new requirements for councils to have prudential management policies, practices and procedures for assessment of projects and would also insert the reasons for these requirements. These ensure that the council—

acts with due care, diligence and foresight; and

identifies and manages risks associated with a project; and

makes informed decisions; and

is accountable for the use of council and other public resources.

Importantly the proposed amendments provide that when a council seeks a prudential report on a major proposed undertaking, that report must be provided by someone who is independent of the council, and has no personal interest in the undertaking.

In a similar vein, the Bill proposes to amend section 49 which requires a council to have policies on contracting and tendering. The amendment clearly sets out that a council must have procurement policies, practices and procedures directed to:

obtaining value in the expenditure of public money; and

providing for ethical and fair treatment of participants; and

ensuring probity, accountability and transparency in procurement operations.

Proposed amendments to section 270 of the Act are aimed to improve council customer service and complaint handling. These amendments would require a council to have policies, practices and procedures for dealing with requests for service and complaints about the actions of the council. These policies must be directed to dealing with those requests and complaints in a timely, effective and fair way, and using that information for continuous improvement.

Internal review of decisions is an important part of good public administration in each sphere of government. The Ombudsman has previously drawn attention to the need to improve internal review practices within some councils.

The bill makes provision for regulations to support these important policies and procedures. For example, in relation to councils’ internal review procedures it is proposed to produce a code that can be adopted by regulations to give councils more guidance on the matters that should be taken into account in reviewing decisions.

A regulation-making power is also proposed for section 110 of the Act relating to the code of conduct which a council adopts for its employees, to provide the capacity to mandate minimum provisions that must be included in codes of conduct for council employees. This would match the regulation-making power that already exists in relation to codes of conduct for council members.

External review by the Minister

Where there is reason to believe that a council has failed to comply with an Act or that an irregularity has occurred in the conduct of the affairs of the council, there is the capacity under section 272 of the Act for the Minister, when appropriate, to formally investigate the matter. This power has been exercised recently in connection with the City of Burnside. Although the need for this sort of intervention is rare, it is relatively common for questions and complaints to be made about the operations of councils.

Dealing with this type of correspondence frequently requires the Minister to obtain information from the relevant council information about how a particular matter has been or is being handled. For the most part, councils are usually very co-operative and helpful especially when the subject matter is routine or uncontroversial.

However, if a query raises doubts about the propriety of an individual’s actions, or calls into question the legality of a council decision, a council may be reluctant to provide the Minister with information that is needed to determine a proper response.

The Bill proposes to insert into the Act two new sections, 271A and 271B. The proposed new section 271A provides the Minister with power to ask a council, in writing, for specific information. This provision is not intended to hinder the regular and informal free flow of information between councils and the Minister. Rather, it provides a specific mechanism that may be relied upon where the information being sought might be regarded as sensitive. Proposed new section 271A also protects a council if it divulges information to the Minister that might be confidential or relevant to contractual matters.

Proposed new section 271B provides the Minister with power to ask a council to obtain an independent assessment of its probity or statutory compliance in a matter, or to take specified action (or actions) to meet standards in its conduct or administration consistent with the objects, principles or requirements of the Act. Again this provision is not intended to formalise the normal cooperation that occurs between councils and the Minister. However it provides a mechanism that can be used where necessary to ensure that a council gives due weight to a request for remedial action.

These two new sections are complemented by proposed amendments to section 272 and 273, under which a council’s decision not to comply with the Minister’s requests under section 271A or 271B might prompt a formal investigation, and an investigation, in turn, might provide a basis for the Minister to give directions to the council.

Changes are made to the provisions for formal Ministerial investigation to update powers available to an investigator and to broaden the Minister’s powers of direction following a formal investigation. For example these would ensure the Minister can direct a council if a council fails to respond appropriately to any recommendation of the Ombudsman contained in a report under the Ombudsman Act. Complementary changes are proposed to section 274, which deals with the investigation of a council subsidiary.

Removal of vehicles

In response to a report by the former Acting Ombudsman, the Bill proposes to re-write section 237, which deals with a council’s powers to remove a vehicle apparently abandoned on a road. The proposed changes give greater protection to the owner of vehicle in these circumstances.

Access to documents

When the Act commenced in 1999, the internet was not as widely used as it is today. Therefore, the Act has provided, until now, that council documents should be on the internet only 'so far as is reasonably practicable.' Today, as we prepare to enter the second decade of the 21^st century, there is no longer any argument that providing access to documents on the internet could be considered impracticable. Indeed frequently the internet provides the easiest and most convenient ready access to documents without the limitations of business hours.

Amendments to section 132 will now mandate the use of the internet, and also widen the list of the council’s public documents to include audited financial statements, the council’s annual report and FOI information statement that are within the scope of the section.

Miscellaneous provisions

Fixed charges and minimum rates

Council rating policies are intended to reflect, in large part, a system of progressive taxation generally based on the value of land. It is widely understood in the community that within a council area, applying the rate in the dollar fixed by a council means that high-value land will be subject to a higher rate payment than low-value land. However it is not widely understood that rating policies are only partly progressive. Every SA council (except the City of Adelaide) chooses to include in its rating policy a regressive or 'flat-tax'-type component.

This means that currently 67 councils have a mixed rating policy, attempting to strike a balance between:

spreading the burden according to the relative values of land; and

spreading the burden more evenly between all ratepayers.

To strike this balance, the Local Government Act permits each council to choose between one of two tools:

a minimum rate, requiring owners of the lowest-value assessed land (capped at no more than 35 per cent of all assessments in the council area) to pay at least a specified minimum; or

a fixed charge (i.e. a sum that applies to all assessed land; regardless of the land value).

Section 152 deals with fixed charges, but it does not prevent a council from levying a fixed charge against every piece of land subject to separate occupation. Nor does it limit the proportion of a council’s revenue that can be obtained from a fixed charge, provided the proportion is less than 100 per cent. Therefore, a council could chose to set a fixed charge to raise more than 90 per cent of its revenue, and levy this fixed charge against every piece of land subject to separate occupation, including each separate site in a caravan park or residential park. Obviously if such a rating policy was applied it would impact heavily on low-income persons, such as retirees who have chosen to move into caravan parks or residential parks to reduce costs.

Where several parcels of land make up a single farm enterprise, the Act prevents councils imposing a fixed charge on each one of those parcels of land. However, the single farm enterprise concession is not mirrored in the minimum rate provisions, presumably because of an expectation that viable farming properties would be valued higher than the cut-off valuation for the minimum rate to be applied. There has been instances where this is not the case. To ensure equity, this long standing concession should apply to all farming properties that are subject to either a fixed charge or a minimum rate.

Accordingly, the Bill would amend sections 151, 152 and 158 of the Act to:

prevent councils raising any more than 50 per cent of their general rates through a fixed charge. This will protect the owners of lower-valued land should a council adopt a regressive rating policy;

prohibit the imposition of a fixed charge or a minimum rate against each site in a caravan park or a residential park; and

to exclude any ‘single farm enterprise’ from being charged more than one minimum rate.

Prescribed services

'Prescribed services' under section 155 of the Local Government Act are those few services that are made available to all land in a defined area, and hence benefit the land. These services are:

waste collection and recycling;

wastewater removal;

and in a few rural council areas:

provision of water; and

TV re-transmission services.

Charges for these services may be imposed irrespective of whether a landowner chooses to use the service or not. The reason is that these services cost money to make available and distribute over a geographical area. Even if a person chooses not to put out a bin for collection, that person’s property potentially benefits from the service being available in that area, and so it is fair that the landowner should contribute to the cost of providing the service in that area.

Proposed amendments to section 155 are intended to deal with three separate matters:

The proposed changes to subsections (5), (6) and (7) deal with accounting matters, including the depreciation of assets.

The intent of proposed new subsection (2a) is to deal with circumstances where service charges have been applied to Crown land. It is appropriate that the Crown pay for services it receives in the same way as residents and commercial property owners. However, it is expected that regulations made under this proposed new subsection will exempt land such as National Parks or unalienated Crown land from being levied service charges.

Proposed new subsection (11) is intended to deal with circumstances where waste collection services are provided, but are not directly accessible at the relevant land. The Government intends to consult with the LGA to devise a scheme, to be prescribed in regulations, under which a sliding scale of waste collection charges may be imposed, depending upon the level of service provided.

Community service rate rebates

Section 161 of the Act requires a council to grant a rebate of at least 75 per cent to land 'predominantly used for service delivery and administration by a community service organisation.'

There have been two problems identified with the operation of section 161. First, on the basis of legal advice, some councils have been rejecting applications from community service organisations unless the land the organisation occupies is used for both service delivery and administration. Clearly, the intent of the legislation would best be served by an amendment to grant the rebate to land predominantly used for either service delivery or administration, or both.

Secondly, again on the basis of legal advice, some councils have taken a narrow interpretation of 'supported accommodation' in section 161(4) to deny applications for rebates from community housing organisations. The term 'supported accommodation' is defined in section 4 of the Act, but the definition does not indicate what type of 'support' must be received in order for the accommodation to be classified as 'supported' accommodation. This interpretation has been the subject of discussions since mid-2007 with the Office for Community Housing, the Community Housing Council of SA, the SA Institute of Rate Administrators and the LGA.

Community housing associations are community managed non-government organisations providing housing for those with special housing needs. They are not-for-profit organisations, generally managed by volunteers. These associations meet the eligibility criteria for rebates applicable to other community service organisations but a small number of councils have excluded them from receiving rebates under section 161 based on legal opinion that 'support' should be interpreted only to mean intensive personal services care. This Bill would remove the uncertainty by amending the section 4 definition of 'supported accommodation' to specifically include a reference to housing associations registered with the Office for Community Housing; and amends section 161(1) to remove doubt that each parcel of land must be used predominantly to administer or provide a community service. A transitional provision will allow this change to be 'phased in' over the next 3 financial years.

Community land

The Bill proposes amendments to deal with various issues concerning community land. First, under section 194 of the Act, a council proposing to revoke the status of community land, must prepare a report on the proposal, and must consult the public. The Bill provides that this report must be made available to the public for at least two months. If during that time, the council receives a petition with a sufficient number of signatures opposing revocation of the community land status, then the proposal will be blocked, unless the council obtains a mandate from a poll of electors. The required number of signatures on a petition is five percent of electors, or two hundred electors, whichever is greater. Secondly, if a council wishes to transfer community land to the State Government, but continue to undertake the 'care control and management' of the land as community land, then section 201 places an unreasonable obstacle in the council’s path, by requiring the council to first revoke the land’s classification as community land. In these circumstances, the required revocation is nonsensical and contrary to the council’s intentions. The Bill provides that if land is to remain community land, then there is no need to revoke this status when transferring its ownership.

Third, section 202 of the Act permits a council to issue a lease or licence over community land for a term of up to 21 years. Although the policy intent of this provision is to provide a maximum term of 21 years (i.e. for the total term(s) of the grant and renewal), there has been some confusion in the past that it could be interpreted as allowing a 21-year lease to be renewed for a further 21 years without any requirement for further community consultation. The Bill provides that the maximum term of a lease or licence is to be 21 years. This does not prevent a new lease being granted after such a term, but any such new lease must be subject to a fresh round of community consultation.

Procedural requirements for council orders

A council has many powers to make orders to private land owners. For example, orders can be made to landowners under section 254 (hazards, nuisances, unsightly land) or under section 299 (remove or cut back encroaching vegetation).

The process for making these orders carries some protection for the landowner. Orders under section 254 or 299 may be made only if the relevant person has first received a notice, warning of the proposed order, the reasons for it, and inviting that person to show cause why the order should not be made. A person who receives an order under section 254 or section 299 may appeal to the District Court.

However, there are other order-making powers under sections 216 and 218 which do not detail any process to be followed by the council in making such orders. The Bill deals with this inconsistency by applying the same procedural protections to orders made under sections 216 and 218.

The Bill also standardises the penalty and expiation fee for contravention of any order under sections 216, 218, 254 or 299.

Roads and house numbers

Section 210 of the Act prescribes the process that a council must follow if it wishes to convert a private road into a public road. This process, not surprisingly, requires the council to contact the owner of the road, or at least make reasonable inquiries to find the owner. However, the section is silent about any legal rights to the road that might be held by persons other than the owner. The Bill provides that other persons holding registered legal interests should be subject to the same procedural requirements as the owner of the land. This would include persons with the benefit of a right-of-way, a mortgagee or a registered lessee.

Section 219 of the Act gives a council the power to name a road. Likewise, under section 220, a council may adopt a numbering system. Two separate problems have been identified with these sections. First, in new land divisions, councils sometimes do not assign house numbers or street names until well after houses are built and occupied. This has the potential to cause problems, for example making it difficult for emergency services to locate the appropriate house until the house number is actually assigned. It is also administratively inefficient because identifiers for each house must be entered into databases twice. (For example, even if a street name is unchanged, a house first identified as Lot 13 Smith Street might later need to be changed, for example, to No. 37 Smith Street.)

Second, under sections 219 and 220, assigning a name for a new road, and 'a numbering system for a particular road' cannot be adopted by council officers using delegated authority, but must be a 'resolution' of a council. New roads are occasionally created within new subdivisions. It creates unnecessary delays to have the council formally required to consider adoption of a separate resolution for the name of every new road, and potentially, later, a numbering system for that road. The requirement, in each case, for a 'resolution' also means that the elected council cannot delegate decisions on these matters to the Chief Executive or any staff member.

Accordingly, the Bill proposes to delete references to a council 'resolution' for these purposes. This will enable councils to delegate these decisions to staff. Any delegation to staff, to assign road names would need to be consistent with a council policy on street names. The Bill also requires house numbers to be allocated at the first opportunity in the land division process.

By-laws that apply in only part of the council district.

A council may determine, from time to time, that a by-law applies in only part of the council area. This occurs by a council 'determination' under section 246(3)(e).

However, the Act lacks directions to councils to ensure that the making of such a determination is transparent and accessible to the community.

Accordingly, the Bill contains several amendments to ensure that a relevant determination cannot be delegated by the council, and must be published on the internet, in the Gazette, and in a local newspaper in the same way as a by-law.

Entering private land to carry out work

An employee or contractor of a council may enter and occupy land 'insofar as may be reasonably necessary for carrying out a function or responsibility of the council'. This might involve, for example, depositing tonnes of gravel or sand prior to using the material for adjacent road works. When it enters and occupies land, the council is liable to pay the landowner rent, and to compensate the landowner for any nuisance or damage caused.

However, the Act does not refer to remediation—that is restoring the land to its former state. Nor does it contain any detail of the process required to gain access and occupation; for example a requirement to provide written notice of the council’s intention to enter or occupy the land, and any rights of appeal for the landowner.

The Bill therefore inserts amendments to section 294, which would:

require the council to undertake remediation of the land, to the extent reasonably practicable;

require the council to pay compensation for any other loss or damage caused; and

prescribe a process that must be followed by the council in order to gain access and occupation, except when:

there is an emergency; or

the owner or occupier cannot be located; or

the occupation is less than 24 hours and causes no material nuisance or damage.

The amendments to section 294 effectively render section 295 redundant, so that section is to be repealed.

Strict liability when exercising emergency powers

Under section 298, a council has power to take action 'as it thinks fit' in the event of a flooding emergency. This action may be taken irrespective of whether any emergency declaration has been made under the Emergency Management Act 2004.

However, a council that does take action in reliance on the powers in section 298 is liable—under subsection (3)—to 'compensate any person who suffers loss in consequence' of the council’s action.

This liability applies even if the council has acted entirely reasonably and without negligence. It is a strict liability. For example, if a council were to divert rising floodwaters, in order to save lives and/or multiple properties, the council would nevertheless be liable to compensate a single property owner for any damage caused to land onto which the floodwaters had been diverted.

A similar strict liability that was formerly imposed on the State Emergency Service was repealed with the commencement of the Fire and Emergency Services Act 2005. There is no similar strict liability imposed on SA Police, the Metropolitan Fire Service, or the Country Fire Service.

Repealing the compensation provisions in section 298 would not prevent a council from being held liable in common law over the use or misuse of its powers. Such repeal would merely leave councils in the same situation as other emergency organisations, exposed to liability in tort, i.e. to claimants alleging negligence, nuisance or trespass.

In these situations a council would be able to rely on a defence of 'statutory authority' or 'necessity'. To succeed in a claim for negligence, for example, a claimant would presumably need to establish that the council 'had not exercised reasonable care' in the exercise of its statutory power.

Section 298 is restricted to actual or imminent flooding. It does not cover any other emergencies. There are reasons to consider additional powers for councils to respond to other emergencies. However, the State Emergency Management Committee (SEMC) is conducting a review of the Emergency Management Act, and it is likely that further legislative reforms will be considered as part of that review. This Bill merely proposes to repeal subsections 298(3) and (4) to remove a council’s strict liability for the exercise of its emergency powers.

Electronic attendance at committee meetings

In regional areas, council committee members often have to travel long distances to attend meetings that may be quite brief. There would be considerable gains in efficiency if council committees could exercise discretion to permit members to participate by teleconference or webcam.

The Bill proposes to amend section 90 to permit council committee meetings to be held using electronic communication, provided that members of the public can still hear the discussion between all committee members. This proposed amendment does not apply to full council meetings; only to committees.

Scheduling representation reviews by regulation

Under section 12 of the Act each council must conduct a review, into its 'composition and ward structure' at least once in every eight years.

Such a representation requires a council to consider:

how many elected members it needs to adequately represent its community;

how many, if any, wards there should be within the council area, and their boundaries; and

the method of electing the council’s principal member.

The process can take up to nine to ten months to complete. In 2009, there are about 48 out of South Australia’s 68 councils that are (or have been) undertaking representation reviews; their second since the commencement of the Act on 1 January 2000.

All of these reviews must be completed no later than 31 December 2009. This date is less than three months before the scheduled State election, and certifying so many representation reviews in such a short time, whilst simultaneously preparing for a State election, places undue pressure on the resources of the Electoral Commission.

If no action is taken, the same logjam of multiple representation reviews will occur again, in another eight years. Rather than have so many reviews conducted all in the same year, it is more appropriate, for logistical reasons, to have representation reviews for SA’s 68 councils scheduled on an evenly spaced and rolling basis, over the entirety of two four year electoral cycles.

Therefore, the Bill would amend section 12 to provide that representation reviews for each council may be scheduled by regulation.

Conflict of interest

A recent case in the District Court required the court to interpret and apply sections 73 and 74 of the Act, that deal with councillors (and members of council committees and the Boards of any subsidiaries) who may have a conflict of interest in a matter for decision. These sections define when members have an interest in a matter before the council, and provide that they must disclose such an interest. Unless specified qualifications apply, they must not then take part in debate or vote on the matter and must leave the meeting while that is occurring.

In Adelaide Parklands Preservation Assoc v The City Of Adelaide His Honour Judge Barrett found that two councillors, who had an interest as defined by the Act because of their membership of the South Australian Motor Sport Board, should not have taken part in debate or voted on a motion.

The decision raised doubts about the proper role of councillors appointed or nominated by their council to that Board or the governing body of other, various non-profit associations. His Honour in interpreting section 74 found that the two councillors did not fall within the qualifications in subsection 74(4) as they were not 'appointed by the council' to the South Australian Motor Sport Board, but nominated by the Council with the appointment was made by the Governor.

The Bill would clarify section 74 and restore the interpretation that was previously relied upon by local government and its legal advisors. It provides that a councillor must declare their interest but is not required to abstain from taking part in debate or voting—as otherwise would be required by subsection 74(4)—in either or both of the following circumstances:

(a) the member or a person closely associated with the member is a member of, or director or member of the governing body of, a non-profit association;

(b) the member or a person closely associated with the member is a member of a body (whether incorporated or unincorporated) comprised of or including, or having a governing body comprised of or including, a person or persons appointed or nominated by the council.

Frew Park, Mount Gambier

The City of Mount Gambier holds a reserve named Frew Park, under a Trust established in 1896. The only uses that the trust has permitted for the land are 'walks, recreation, military or other exercises'. The City of Mount Gambier wishes to permit other activities at Frew Park, albeit uses that would be consistent with its classification as community land.

Schedule 8 of the Act includes specific provisions about other identified named reserves. It is appropriate to deal with the limitations of the Frew Park Trust by inserting a new clause in Schedule 8 so that Frew Park is confirmed as community land, freed of the restrictions in the existing trust, but still subject to the protections that the Act provides to all community land.

As indicated, the bill includes both technical and more broadbased policy measures—the latter directed to improving the transparency and accountability of the 68 councils in the State. I am confident that the proposed amendments will support local government to develop and strengthen its policies and procedures and introduce high standards of governance and probity. These reforms will enable local government to continue to improve its accountability to the community and ratepayers of SA and provide a strong basis for councils to move into the future.

I commend the Bill to Members.

Explanation of Clauses

Part 1—Preliminary

1—Short title

2—Commencement

3—Amendment provisions

These clauses are formal.

Part 2—Amendment of Local Government Act 1999

4—Amendment of section 4—Interpretation

This clause includes a definition of CPI and amends the definition of supported accommodation.

5—Amendment of section 8—Principles to be observed by a council

This clause establishes principles to be observed by a council.

6—Amendment of section 12—Composition and wards

This clause amends section 12 by substituting the requirement to conduct a review under the section at least once in every 8 years with a review at least once in each relevant period that is prescribed by the regulations.

The clause deletes subsection (4a) of section 12.

7—Amendment of section 44—Delegations

This clause deletes and substitutes paragraph (a) of subsection (2) so that a council may not delegate power to make a by-law or to determine that a by-law applies only within a part of parts of the area of the council.

8—Amendment of section 48—Prudential requirements for certain activities

This clause inserts proposed subsection (aa1) into section 48 to provide that a council develop and maintain prudential management policies, practices and procedures for the assessment of projects to ensure that the council maintains certain specified standards. The policies practices and procedures must be consistent with any regulations made under the section.

Subclause (4) amends subsection (1) by extending the basis on which a council must obtain and consider a report that addresses certain prudential issues to include where the council considers that it is necessary or appropriate.

Proposed subsection (4a) provides that a report under subsection (1) must not be prepared by a person who has an interest in the relevant project (but may be prepared by an employee of the relevant council).

Various new subsections deal with conflict of interest issues and identify the circumstances in which members are held to have an interest in a project.

Finally, a series of amendments provide that the $4,000,000 sum under section 48(1)(b)(ii) of the Act is to be indexed in accordance with the CPI.

9—Amendment of section 49—Contracts and tenders policies

Proposed subsection (a1) provides that a council must develop and maintain procurement policies, practices and procedures directed towards—

obtaining value in the expenditure of public money; and

providing for ethical and fair treatment of participants; and

ensuring probity, accountability and transparency in procurement operations.

Provision is made for the requirement that policies on contracts and tenders must be consistent with any requirement prescribed by the regulations.

10—Amendment of section 59—Roles of members of councils

This clause inserts new subparagraph (iv) into subsection (1)(a) to provide that the role of a member of a council is, as a member of the governing body of the council, to ensure, as far as practicable, that the principles set out in section 8 are observed.

11—Amendment of section 74—Members to disclose interests

This clause deletes paragraph (c) of subsection (4a) and inserts new subsection (4a), which identifies the circumstances in which members are held to have a conflict of interest. Another amendment will enable the Ombudsman to investigate an alleged breach of the section (if the person applying for an investigation is determined to have a sufficient interest in the matter).

12—Amendment of section 84—Public notice of meetings

These amendments revamp the process for the publication of notices of council meetings.

13—Amendment of section 88—Public notice of committee meetings

These amendments revamp the process for the publication of notices of council committee meetings.

14—Amendment of section 90—Meetings to be held in public except in special circumstances

This clause inserts new subsection (7a), which sets out the circumstances in which a council committee meeting will be taken to be conducted in a place open to the public for the purposes of section 90.

15—Amendment of section 110—Code of conduct

This clause inserts new subsections (3a) and (3b).

Proposed subsection (3a) provides that a code of conduct must be consistent with any principle or requirement prescribed by the regulations and include any mandatory provision prescribed by the regulations.

Proposed subsection (3b) provides that the Minister should take reasonable steps to consult with any registered association that represents the interests of employees of councils before a regulation is made under proposed subsection (3a).

16—Amendment of section 123—Annual business plans and budgets

This clause amends subsection (5) of section 123 by extending the number of days by which copies of the draft annual business plan must be available before the date of the meeting from 7 to 21 days.

This clause inserts subsection (5a), which requires the council to ensure that provision is made for a facility for answering questions and the receipt of submissions on its website during the public consultation period.

17—Amendment of section 127—Financial statements

This clause deletes paragraphs (a) to (e) of subsection (1) and inserts new paragraph (a) to ensure that a council must prepare for each financial year, financial statements and notes in accordance with standards prescribed by the regulations.

18—Amendment of section 129—Conduct of audit

This clause deletes and substitutes subsection (1) to ensure that the auditor of a council must undertake an audit of—

the council's financial statements within a reasonable time after the statements are referred to the auditor for the audit (and, in any event, unless there is good reason for a longer period, within 2 months after the referral); and

the controls exercised by the council during the relevant financial year in relation to the receipt, expenditure and investment of money, the acquisition and disposal of property and the incurring of liabilities.

Clause 16 deletes and substitutes subsection (3) to ensure that the auditor provides to the council—

an audit opinion with respect to the financial statements; and

an audit opinion as to whether the controls audited under subsection (1)(b) are sufficient to provide reasonable assurance that the financial transactions of the council have been conducted properly and in accordance with law.

This clause deletes subsection (5a) and inserts new subsections (5a) to (5e) (inclusive).

Proposed subsection (5a) sets out the basis on which the auditor will provide the opinion under subsection (3) and the advice under subsection (4).

Proposed subsection (5b) sets out the manner in which the opinion and advice must be placed on the agenda for consideration (unless proposed subsection (5c) applies).

Proposed subsection (5c) provides that the opinion and advice may be the subject of a special meeting of the council called in accordance with the requirements of the Act (and held before the ordinary meeting of the council that would otherwise apply under subsection (5b).

Proposed subsection (5d) makes provision for the confidentiality of the opinion under subsection (3) and proposed subsection (5e) sets out the basis on which the advice under subsection (4) may be kept confidential.

Subclause (9) inserts new paragraphs (d) to (h) (inclusive) into section 129(6) to expand upon the matters that the auditor must report to the Minister.

Subclause (10) inserts new subsection (9) to provide that an opinion under subsection (3), provided to a council under the section, must accompany the financial statements of the council.

19—Amendment of section 132—Access to documents

This clause substitutes paragraph (f) and inserts new paragraphs (h) to (j) (inclusive) of section 132(3) to expand on the list of documents that a council should make available for inspection on the Internet within a reasonable time after they are available at the principal office of the council.

Subclause (4) provides that the Governor may by regulation amend the list of documents contained in subsection (3) from time to time.

20—Amendment of section 132A—Related administrative standards

This clause substitutes paragraph (b) of section 132A so that a council must ensure that appropriate policies, practices and procedures are implemented and maintained in order to achieve and maintain standards of good public administration.

21—Amendment of section 133—Sources of funds

This clause deletes paragraph (b) from the Examples set out in section 133.

22—Variation of section 151—Basis of rating

This clause inserts new subsections (10) and (11) into section 151 of the Act to provide that a council must not, in relation to any financial year, seek to set fixed charges as a component of general rates at levels that will raise a combined amount from such charges that exceeds 50 per cent of all revenue raised by the council from general rates. Proposed subsection (11) provides that a charge is not invalid because fixed charges imposed in relation to any financial year raise more than the amount referred to in proposed subsection (10).

23—Amendment of section 152—General rates

This clause amends section 152 by expanding on the range of exceptions to the requirement imposed under the section to apply a fix charge equally to each separate piece of rateable land in the area so that a fix charge cannot be imposed against each site in a caravan park or each site in a residential park within the meaning of the Residential Parks Act 2007.

24—Amendment of section 155—Service rates and service charges

This clause inserts new subsection (2a) to provide that a council's ability to impose service rates and annual service charges on rateable and non-rateable land under subsection (2) does not apply in prescribed circumstances.

Subclause (4) inserts new subsections (6) and (7).

Proposed subsection (6) provides that, subject to subsection (7), any amounts held in a reserve established in connection with the operation of subsection (5) must be applied for purposes associated with improving or replacing council assets for the purposes of the relevant prescribed service.

Proposed subsection (7) provides that if a prescribed service under subsection (6), is, or is to be, discontinued, any excess of funds held by the council for the purposes of the service (after taking into account any expenses incurred or to be incurred in connection with the prescribed service) may be applied for another purpose specifically identified in the council's annual business plan as being the purpose for which the funds will now be applied.

Subclause (5) inserts proposed subsection (11) to provide that if a prescribed service, in relation to a particular piece of land, is not provided at the land and cannot be accessed at the land, a council may not impose in respect of the prescribed service a service rate or annual service charge (or a combination of both) in relation to the land unless the imposition of the rate or charge (or combination of both)—

is authorised by the regulations; and

complies with any scheme prescribed by the regulations (including regulations that limit the amount that may be imposed or that require the adoption of a sliding or other scale established according to any factor, prescribed by the regulations, for rates or charges (or a combination of both) imposed under this section).

25—Amendment of section 158—Minimum rates and special adjustments for specified values

This clause amends section 158(2) of the Act by inserting new paragraph (ba) into subsection (2) to add, each site in a caravan park or each site in a residential park within the meaning of the Residential Parks Act 2007, to the list of matters that a council cannot impose a minimum rate against. The clause adds new paragraph (bb) into subsection (2) to provide that if 2 or more pieces of ratable land within the area of a council constitute a single farm enterprise, a minimum amount may only be imposed against 1 of the pieces of land.

New paragraph (da) is inserted into subsection (2) so that a council may not apply section 158 so as to affect or alter a separate rate that would be otherwise payable under section 154 in relation to more than 35 per cent of the total number of properties in the area that should be subject to the separate rate.

Paragraph (e) of subsection (2) is substituted and replaced with new paragraph (e) so that a council cannot apply section 158 in respect of a general rate or a separate rate if the council has included a fixed charge as a component of that rate.

26—Amendment of section 161—Rebate of rates—community services

This clause amends section 161(1) to ensure that rates on land apply to land being predominantly used for service delivery or administration (or both).

27—Amendment of section 194—Revocation of classification of land as community land

This clause amends section 194(2) to ensure that a report prepared by a council on the proposal is made publicly available. A new scheme for the submission of a proposal to revoke the classification of land as community land to a poll of electors if a 'qualifying' petition is made to the council is also included.

28—Amendment of section 201—Sale or disposal of local government land

This clause deletes and substitutes paragraph (a) of section 201(2) to provide that a council may only dispose of community land if the land is to be amalgamated with 1 or more other parcels of land and the amalgamated land is to be (or to continue to be) community land or, in any other case, after revocation of its classification as community land.

29—Amendment of section 202—Alienation of community land by lease or licence

This clause deletes and substitutes subsection (4) of section 202 with proposed subsection (4) to provide that a lease or licence is to be granted for a term not exceeding 21 years and the term of the lease or licence may be extended but not so that the term extends beyond a total of 21 years.

The clause inserts new subsection (4a) into section 202 to provide that subsection (4) does not prevent a new lease or licence being granted at the expiration of 21 years (subject to the other requirements of this Act or any other law).

30—Amendment of section 210—Conversion of private road to public road

This clause inserts new paragraph (ab) into subsection (2) of section 210 of the Act. Proposed paragraph (ab) ensures that if a person has some other form of registered legal interest over the private road and the identity and whereabouts of that person are known to the council—the council must give written notice to the person of the proposed declaration at least 3 months before it makes a declaration under section 210.

This clause deletes and substitutes subsection (3) to provide that the following applications may be made to the Land and Valuation Court in connection with a declaration under section 210:

an owner of the private road may apply to the court for compensation for the loss of the owner's interest in the road;

a person who has some other form of registered legal interest over the private road may apply to the court for compensation for the affect of the discharge of that interest.

31—Amendment of section 216—Power to order owner of private road to carry out specified roadwork

This clause deletes and substitutes subsection (2) of section 216 of the Act to ensure that the requirements imposed under Division 2 and 3 of Part 2 of Chapter 12 apply with respect to any proposal to make an order and if an order is made, any order, under subsection (1) of section 216.

32—Amendment of section 218—Power to require owner of adjoining land to carry out specified work

This clause deletes and substitutes subsection (2) of section 218 to ensure that the requirements imposed under Division 2 and 3 of Part 2 of Chapter 12 apply with respect to any proposal to make an order and if an order is made, any order, under subsection (1) of section 218.

33—Amendment of section 219—Power to assign a name, or change the name, of a road or public place

This clause inserts new subsection (1a) into section 219 of the Act to require a council to assign a name to a public road created after the commencement of this subsection by land division.

Subclause (2) amends subsection (4) so that Public notice must be given of the assigning or changing of a name under subsection (1) rather than of a resolution assigning or changing a name.

Subclause (3) inserts new subsections (5) to (8) (inclusive) to—

require a council to adopt a policy relating to the assigning of names; and

allow a council to alter its policy, or substitute a new policy; and

require public notice to be given of any alterations to a policy or adoption of a policy.

34—Amendment of section 220—Numbering of premises and allotments

This clause inserts new subsections (1a) and (1b) into section 220 of the Act.

Proposed subsection (1a) requires that a council must assign a number (as part of its primary street address) to all buildings or allotments adjoining a public road created after the commencement of this subsection by land division.

Proposed subsection (1b) requires that a council must ensure that an assignment under proposed subsection (1a) occurs within 30 days after the issue of certificate of title in relation to the relevant land division in accordance with any requirements prescribed by regulations made for the purposes of this subsection.

35—Substitution of section 237

This clause substitutes section 237 of the Act.

237—Removal of vehicles

The proposed section provides that if a vehicle has been left on a public road or place, or on local government land for at least 24 hours, an authorised person may place a prescribed warning notice on the vehicle. After 24 hours has expired since the placement of a prescribed warning notice, an authorised person may have the vehicle removed to an appropriate place.

The proposed section makes provision for the sale of the vehicle if the owner of the vehicle does not take possession of the vehicle and pay expenses associated with the removal of the vehicle.

36—Amendment of section 246—Power to make by-laws

This clause inserts new subsection (4a) into section 246 of the Act to provide that if a council makes a determination under subsection (3)(e) that a by-law, or a provision of a by-law, applies only within a part or parts of the area, the council must ensure that notice of the determination is published in the Gazette and in a newspaper circulating in the area of the council.

37—Amendment of section 258—Non-compliance with an order an offence

This clause deletes and substitutes the penalty and expiation fee provisions in section 258 to increase the maximum penalty to $2 500 and the expiation fee to $210.

38—Amendment of section 270—Procedures for review of decisions and requests for services

This clause inserts new subsections (a1) and (a2) to make provision for the development and maintenance of policies, practices and procedures in relation to requests for the provision of a service or for the improvement of a service provided by the council or complaints about the actions of the council, its employees or other persons. The policies, practices and procedures must be directed towards dealing with the relevant requests or complaints in a timely, effective and fair way and using information gained from the council's community to improve its services and operations.

Subclause (3) inserts new subsection (4a) to ensure that the policies, practices and procedures established under section 270 must be consistent with any requirement prescribed by the regulations.

39—Amendment of section 271—Mediation, conciliation and neutral evaluation

This clause amends section 271 to add conciliation proceedings to the range of possible dispute resolution schemes available to deal with disputes between a person and the council.

40—Insertion of sections 271A and 271B

This clause inserts sections 271A and 271B.

271A—Provision of information to Minister

Proposed section 271 compels a council to, at the request of the Minister, provide to the Minister specified information, or information of a specified kind, relating to the affairs or operations of the council.

271B—Minister may take steps to ensure reasonable standards are observed

The proposed section provides that the Minister may, after taking into account such matters as the Minister thinks fit, request a council to obtain an independent assessment of its probity or its compliance with any requirement placed on the council under this or any other Act or, without limiting paragraph (a), to take specified action to meet standards in the conduct or administration of the affairs of the council identified by the Minister as being consistent with the objects of this Act, or any principles or requirements applying under this Act.

41—Amendment of section 272—Investigation of a council

This clause inserts new paragraph (ab) into section 272(1) to enable the Minister to appoint an investigator to carry out an investigation if the Minister has reason to believe that a council has failed to comply with a request under proposed sections 271A or 271B.

The clause further provides that the requirement to give a council notice before making an appointment under subsection (1), is not required if the Minister considers that the notice would be likely to undermine the investigation.

An investigator appointed under subsection (1) may, for the purposes of an investigation—

require a person who has access to information that is, in the opinion of the investigator, relevant to the investigation, to provide that information to the investigator in a form determined by the investigator;

inspect—

any building or other premises occupied by the council;

the operations of the council conducted in or on any building or other premises;

Proposed subsection (6a) provides that if during the course of an investigation an investigator considers that other matters relating to the affairs or operations of the council should be subject to investigation or report, the investigator may, after consultation with the Minister, proceed to investigate (as necessary), and report on those matters. The Minister will be able to call for interim reports.

42—Amendment of section 273—Action on a report

This clause expands the matters upon which the Minister may give directions to the council under the section to include if the Minister considers that a council has failed to respond appropriately to a recommendation of the Ombudsman or that a council has failed to address appropriately a matter that formed the basis of a request under proposed section 271B.

The clause expands the matters upon which the Minister may recommend to the Governor that the council be declared to be a defaulting council to include if the Minister considers that there has been a failure to comply with a direction under subsection (2)(b) or a failure to comply with a requirement to take specified action in respect of a subsidiary for the purposes of section 275.

The clause deletes subsection (4) of section 273.

43—Amendment of section 274—Investigation of a subsidiary

This clause makes amendments to the Minister's power to refer specified matters for investigation in respect of a subsidiary that correspond with those amendments made by clause 39 to the Minister's power to refer specified matters for investigation in respect of a council.

44—Amendment of section 294—Power to enter and occupy land in connection with an activity

This clause amends section 294 to allow a council to conduct surveys, inspections, examinations and tests, and carry out work.

45—Repeal of section 295

This clause repeals section 295 of the principal Act.

46—Amendment of section 298—Power of council to act in emergency

This clause deletes subsections (3) and (4) from section 298 of the Act.

47—Amendment of section 302—Application to Crown

This clause amends section 302 of the Act to expressly provide that the Crown is bound by Chapter 10 of the principal Act.

48—Amendment of Schedule 2—Provisions applicable to subsidiaries

(1) This clause amends subclause (2) of clause 13 of Schedule 2 to remove the ability of the council to exempt a subsidiary from the requirement to establish an audit committee.

(2) Subclause (2) makes it clear that an audit committee established by a subsidiary may include persons who are members of the council's audit committee.

(3) Subclause (3) amends subclause (2) of clause 30 of Schedule 2 to replace the ability of the charter of a regional subsidiary to exempt the regional subsidiary from the requirement to establish an audit committee with the ability of such exemption to be provided by regulation.

(4) Subclause (4) makes it clear that an audit committee established by a regional subsidiary may include persons who are members of a constituent council's audit committee.

49—Amendment of Schedule 4—Material to be included in the annual report of a council

This clause deletes paragraph (e) from clause 1 of Schedule 4.

50—Amendment of Schedule 8—Provisions relating to specific land

This clause inserts new clause 12 into Schedule 8 of the Act.

12—Frew Park

Proposed clause 12 classifies Frew Park as community land and makes that classification irrevocable. The clause also revokes the Frew Park trust.

Schedule 1—Transitional provisions

1—Interpretation

This identifies the principal Act for the purposes of the schedule.

2—Transitional provision—audit opinions

This clause sets out transitional provisions that apply to the various auditing arrangements imposed by the amendments made by this Act to section 129 of the principal Act.

3—Transitional provision—Rebate of rates

This clause provides for the 'phasing in' of the new rebate for supported accommodation that qualifies under section 161 of the principal Act.

Mrs PENFOLD (Flinders) (16:19): I advise the house that I am not the lead speaker on this bill. I commend the many people who work and serve in the local government sector. Local government plays a vital role in keeping communities connected and is part of our everyday lives. Local governments in South Australia look after more than $14.6 billion of infrastructure. In 2007-08, local government spent almost $240 million on upgrading assets and more than $207 million on new assets.

Over the years I have represented the Flinders electorate, I consider that I have had a good working relationship with the 10 councils (now eight) that are in my electorate. They are all small rural councils, with the exception of the City of Port Lincoln, and play a pivotal role in dealing with the changes to the environment, the economy, our culture and the everyday complexities of life. The staff and elected members are to be commended for the work they do under what is often difficult circumstances due to lack of resources and their remote locations. Too often governments introduce legislative changes with no consideration given to these under-resourced councils and the 'one size fits all' approach results in additional pressures.

Elected members I speak to all agree that, in the last 10 to 15 years, the number and degree of responsibility for councils and elected members has increased significantly. Community expectations have increased and state government requirements have increased, yet their rate base and staff numbers have not. In spite of that, members of the community continue to put their hands up for what has been a voluntary position and put in many hours and years as elected members representing their communities, with often very little recognition or thanks. I am hoping that now the remuneration tribunal is going to determine elected members' allowances, more people will be encouraged to become a local councillor, as we are seeing fewer people willing to give up the necessary time away from their jobs, families and other personal and community commitments.

Local government is an integral part of our community and its elected members are democratically elected to make representative, informed and responsible decisions in the interests of local communities. Councils continually demonstrate their commitment to their communities and, in recent years, significant governance changes have been made to ensure greater accountability and to strengthen councils' governance systems and practices.

The independent Inquiry into the Financial Suitability of Local Government in 2005 was a turning point. The inquiry, headed by Bill Cossey, found that, in recent years, councils had put current needs of communities ahead of their own sustainability. They were facing major infrastructure backlogs and that all councils needed to improve financial governance to avoid future problems. The inquiry resulted in 62 recommendations, which, commendably, the Local Government Association resolved to support in full or in principle and a task force was set up to oversee the rollout of the program of improved financial governance. It is worth noting that New South Wales, Western Australia and Tasmania have since undertaken similar inquiries.

Led by the Local Government Association, councils have worked hard to reform their financial positions and, for the first time on record, delivered an aggregate surplus for the sector in 2007-08. Local Government Association President, Mayor Felicity-ann Lewis, was reported as stating that it was an important milestone and evidence that councils had improved their financial management particularly as they were also spending a record amount on infrastructure renewal. She acknowledged that the Roads to Recovery program and supplementary road funding from the Australian government had assisted councils to reduce infrastructure backlogs, and the new community infrastructure program will further help this year and next.

South Australian councils now have strategic management plans which are updated every four years to coincide with elections; long-term financial plans, infrastructure and asset management plans; they publish draft annual business plans (which include their budget for the coming financial year) for consultation; and have established audit committees.

I am aware that, over recent years, the LGA has committed considerable resources to support councils across the state in strengthening their governance systems and practices. They have developed a range of resource materials, including information papers, guidelines, model policies and procedures, backed up by comprehensive training package courses, which are offered to both elected members and council officers across a wide range of relevant topics.

The LGA's good governance assessment program will provide councils with a tool to assess, monitor and report on their own governance practices and performances. As part of this program, councils will also have the opportunity to have their governance self-assessments validated by an independent assessor over the five year cycle.

A good governance panel has been formed to provide another resource for councils to use in dealing with conduct complaints against councils and council development assessment panel members. All this demonstrates that the LGA and its member councils are endeavouring to provide and promote, leading to good practice. The LGA and the councils it represents are, I believe, committed to a strong local government sector and recognise the importance of accountability and transparency. I understand, not surprisingly, that the majority of councils and the LGA support the general direction of the bill, but there were some provisions they strongly objected to.

Overall, it is difficult to argue against provisions which will strengthen the governance framework of a sphere of government and which will reinforce the expectations that that sphere of government will operate with appropriate standards of good public administration. I wonder, though, how much more councils—particularly smaller councils—can do to satisfy members of parliament and the community; and I can appreciate that there are some provisions that councils have objected to. Has anyone taken into consideration the resource implications on councils, particularly the smaller ones, in having to comply with this legislation?

The majority of councils are doing the right thing, but increased legislation and regulation is placing a greater burden on these smaller councils. These changes will result in greater auditing costs and a greater and higher level of documented policies, procedures and practices. What additional support will be provided to assist smaller and rural councils? The bill is reliant on regulations, the details of which are yet unknown. Previous experience with a rollout of the Eyre Peninsula Coastal Management Strategy has clearly demonstrated that the devil is in the detail.

To suggest that local government relies on the state government to do the right thing and recognise that significant effort in time and money has already been made by the councils without local government being included in the procedures, is asking too much. It is essential that the local government sector be involved in the process of developing the regulations. Clause 22 (amendment of section 155—Service Rates and Service Charges) is clearly an overreaction by the minister to the initial concerns of residents about the Yorke Peninsula council introducing an annual service charge to fund its waste collection service.

This clause has the potential to have a far-reaching impact on many councils, and would appear to be somewhat contrary to the government's policy to reduce landfill and the 'user-pays' policy. I would suggest that there is always reaction to what is perceived to be an additional service charge. However, traditionally, bin collection costs have been recovered through general rates, where it is possible that people who do not receive a service paid and where, possibly, higher-valued properties paid more. I understand that, where the service charge is applied, it is calculated by dividing the total cost of the service by the number of properties that receive a service.

The cost of waste management is escalating as councils strive to meet the state government's focus on reducing the amount of waste going to landfill and the number of landfill sites. The levy that councils pay for disposing of each tonne of waste has more than doubled in recent years. In addition, new Environment Protection Authority (EPA) guidelines to reduce the impact of landfill on the environment has increased operating costs, and the amount of waste going to landfill must be reduced.

Smaller regional councils are struggling. The District Council of Lower Eyre Peninsula's annual business plan states:

Waste management continues to be a significant recurrent cost for council. The closure and capping of existing landfill sites and the conversion of the Cummins and Coffin Bay sites to transfer stations is in process. The total cost of the revamped waste management activities is expected to require a 3.2 per cent increase in rate revenues but will provide a service more in line with current day expectations and requirements.

The council, in conjunction with the City of Port Lincoln and the District Council of Tumby Bay, is working to develop an appropriate landfill solution to service the southern Eyre Peninsula community, and it has entered into a memorandum of understanding with a private company to construct and operate a landfill site. I commend these three councils for their planning and forward thinking to provide an acceptable and affordable solution to waste management for many years to come.

The councils are an important tier of democratically-elected governments, and the state government, rather than imposing more legislative controls and taking an increasingly regulatory approach, should be endeavouring to work with the LGA, regional organisations and individual councils towards a more harmonious working partnership. A more streamlined state/local government arrangement would better serve South Australian communities, particularly those in regional South Australia that already struggle with a poor understanding by governments and their bureaucracies of the higher costs and distances that have to be dealt with by the smaller regional councils.

The issue of volunteers was recently highlighted in the Port Lincoln Times by the Mayor of Tumby Bay, Mr Graeme Stirling. He stated:

Volunteering has become a hot topic for local councils as they battle to meet legal safety obligations, at the cost of vital volunteer hours...The concern is that under SafeWork SA requirements volunteers need to be inducted and have a council staff supervisor; both come at a cost and additional time to staff and volunteers. This is required even for an individual who wants to rake up leaves on the foreshore or a retired painter who wants to help out painting at the town hall. Any working bees, which are planned for just one day to give people who work time to help, are also a challenge in organising an induction day.

Mr Stirling said on top of this the volunteers were required to wear the appropriate safe work clothing and equipment...'It's becoming ridiculous,' Mr Stirling said of the regulations. In a community such as Tumby Bay there is a large section of people and community groups 'that like to do the work themselves'.

The Tumby Bay Cemetery Upgrade Committee is a group of volunteers that has ensured the upkeep of the cemetery for many years. Over the last 18 months members have done substantial work including a new gazebo for the area. For these men commonsense prevails and many have also had the experience in various industries. Yet they will have to undergo training and work under specified regulations. The regulations also have another effect—the drop in volunteers.

Volunteer John Lawrie said there was one instance where a group of campervan travellers had seen the work being done in the cemetery and offered to lend a hand weeding and for other jobs. Mr Lawrie said under the regulations they would have had to either reject the offered help or ask the travellers [to] spend half a day in induction. Of particular concern to the council is that it may have to employ an occupational health and safety officer, which with that additional cost to ratepayers would almost defeat the purpose of volunteers who donate their time to local projects.

The issues for our local small councils in regional South Australia, particularly on Eyre Peninsula, are ongoing, and we need the support of state and federal governments to overcome some of them.

Mr GOLDSWORTHY (Kavel) (16:32): I advise the house that I am the lead speaker in relation to this legislation. Dealing with this legislation has been a bit of an issue for the parliament, particularly in the other place. The genesis of this bill was a proposals paper that was written in December last year (11 months ago), entitled 'Reforms to improve the accountability framework for local government in South Australia'. That paper was distributed far and wide, giving all the key stakeholders—councils, the LGA and whoever else was interested in it—the opportunity to make submissions and comments to enable the government to prepare a bill. So, this matter has been around for a long time.

However, we find ourselves, on the very last sitting day of the year, in the lead-up to a state election, in the situation where one could argue that this legislation is being hurried through. The government could be accused of not really dealing with the concerns raised by the local government sector concerning the bill. Last time the other place sat there was a period in which the bill did not proceed into the committee stage because the minister had not consulted satisfactorily with the Local Government Association.

The Hon. J.M. Rankine interjecting:

Mr GOLDSWORTHY: That has got nothing to do with it. Minister, a couple of amendments pales into insignificance in relation to a bill that has 27 pages, so don't start lecturing me about issues of that nature.

This legislation has been through a fairly drawn-out process, if I can use that description. Only yesterday it passed the other place; and significant amendments were carried in the other place. One of the reasons that significant amendments were passed relates directly to the St Clair Reserve issue. If that matter had been dealt with in a much improved manner, then I do not believe those amendments would have been moved in the other place. However, they were moved and voted on and they are now part of the bill. I understand that the government has an amendment on file to take out those clauses.

I am the shadow minister for state/local government relations. I support local councils and the role they perform in the community. They have a tough role. It is not easy dealing with any level of government (if you are part of it), but it is certainly not easy dealing with ratepayers in the community at that level because that sphere of government is closest to the community. I acknowledge and understand that. My criticism is not specifically about the local government sector but, rather, the manner in which the St Clair Reserve issue has been dealt with.

I attended a rally a couple of weeks ago in a car park on Woodville Road, across the road from the Charles Sturt council chambers, next to the railway line and immediately adjacent to St Clair Reserve. I estimate that at least 500 people attended that rally. After a couple of speeches in the car park, we went to the foyer of the council chambers. Some people went into the actual council meeting, but the rest of us remained in the foyer. It was packed out there.

We listened to a motion to revoke the initial motion that the council had put forward in relation to St Clair Reserve. We were there for about an hour while they went through that process. We then went to the back of the council chambers to a nice little park area and into another car park where the rally continued. Along with some colleagues from the other place, I had the opportunity to address the people who were attending the rally.

Some of these amendments would not have been necessary if the matter of St Clair Reserve had been dealt with differently. We saw an astonishing decision by the government just this week—it is astonishing in light of the fact that the matter has gone to court. The Minister for State/Local Government Relations has asked that her oversight of the consultation process be set aside and that it be dealt with by the Minister for Health. If that is not an unusual set of circumstances, to say the least, I do not know what is. I think it points to the fact that the minister is inept, given the fact that the oversight of that matter has been passed to the Minister for Health. That is an astounding situation, and another chapter, you could say, in the poor manner in which this St Clair Reserve issue has been dealt with. I understand that in about 20 minutes there will be another rally on the steps of this place by concerned residents in the Charles Sturt council district. I had better hurry, so I can go and attend.

The ACTING SPEAKER (Mr Piccolo): You had better hurry, for all our sakes.

Mr GOLDSWORTHY: Mr Acting Speaker! Getting on to the intent of the bill, as I said, a proposals paper was released last year for discussion, 11 months ago, and the bill has come together. It is actually an amalgamation of two pieces of legislation. Previously, a local government miscellaneous bill had been introduced in the parliament. However, given the fact that this bill was also coming into the parliament, the decision was made by the government to amalgamate the two pieces of legislation into one bill. So we have got accountability framework measures and also these miscellaneous issues to be dealt with.

I do not want to hold up the house unnecessarily, but it talks about good public administration and widening the scope of the audit. I understand that some of these measures in relation to widening the scope of audit may have come from the previous auditor-general. He made some public statements in his report in relation to the nature of audits that are conducted at the local government level. I will read from a report that has been provided to us. I think it is a duplication of the minister's second reading speech. It says, 'to expand and deepen [if you like] the extent of audits'. It is not just a tick and flick, as one might describe it. It also states, 'whether its [councils'] management systems are sufficiently robust and prudent to prevent or detect fraud, wastage, inefficiencies, and so on'.

That lines up in some ways with the legislation that manages the state public sector. I am talking about the Public Finance and Audit Act. The provisions of this bill to some extent mirror what the South Australian Public Service is exposed to in relation to the Auditor-General's activities. The bill also deals with purpose of councils' policies and procedures, external reviews by the minister, removal of vehicles and access to documents.

The miscellaneous provisions look at issues concerning fixed charges and minimum rates. If I can just refer to my notes, that concerns the manner in which councils can raise revenue. I took notes in relation to the issue of fixed charges and minimum rates and some information that was provided to me by the Office for State/Local Government Relations. I thank the minister and the staff of the Office for State/Local Government Relations for providing me with quite a comprehensive briefing. It was good.

My notes are about councils not being able to raise more than 50 per cent of their revenue through a fixed charge. That was the information in regard to the provision, which the office provided to me in our briefing. It addresses prescribed services. This is an issue that came from, basically, the Yorke Peninsula council, where some concerns were raised within the community about a service charge for waste collection, which was being applied uniformly across the whole council area, but, in fact, the service was not being provided at the land. I understand that the member for Goyder, the deputy leader, received a petition with 742 signatures, which he tabled in the parliament.

Whilst I know that the Local Government Association has issues with the way the bill deals with this—and I propose to move an amendment that specifically referred to waste collection—I have undertaken further consultation about this matter, and I believe it closes a loophole in the current act that will not allow councils to apply a service charge in the manner that the Yorke Peninsula did initially across the services that it provides to the community.

I know that the LGA has issues with this, and I was going to deal specifically with waste collection, but, as I said, I have received further information that has brought me to the position where I will not move the amendment. In any case, we know that the government does not support that amendment. It did not support it in the other place, so there is not a lot of point doing that.

I bill also addresses community service rate rebates, community land, procedural requirements for council orders, roads and house numbers, by-laws that apply in only one part of the council district, entering private land to carry out work, strict liability when exercising emergency powers, electronic attendance at committee meetings, scheduling representation, reviews by regulation, conflict of interest and a specific issue concerning free parking in Mount Gambier. So, Madam Deputy Speaker, you can see that the bill is not without it complexities, and covers a broad range of issues relating to local government.

I did not say this at the outset, but the opposition does support the legislation. We moved a number of amendments in the other place that were defeated, and we also had some other proposed amendments; however, the government took some heed of the Local Government Association and moved those amendments itself, so that discounted the opposition's activity in relation to that. In this place it really came down to moving two amendments: one in relation to the waste collection issue specifically, and the other concerned with the provision of council documents to councillors who had declared a conflict of interest.

I understand the intent of that, and of the Local Government Association's remarks in relation to it, but I have spoken to some people who have been directly involved in local government—particularly the member for Frome, who had previously been mayor of Port Pirie—and it seems that in practical application that may not be workable. In view of that, and after speaking to the minister about it, I do not believe that we actually need to move the amendments I had flagged. With that brief contribution, and as I said, members on this side are prepared to support the legislation. It is a step in the right direction; however, there were some issues that I have previously highlighted that may not have been necessary had matters been dealt with differently.

Mr GRIFFITHS (Goyder—Deputy Leader of the Opposition) (16:52): I will be very brief in my contribution but I do wish to refer to clause 22, which is an amendment to section 155. The shadow minister and I spoke on this for about 90 minutes when we prepared our position paper and, because I come from local government (having worked in that area for 27 years), I do wish to make a brief contribution, especially as it relates to the amendment of section 155. This is a service charge provision, and is relevant to the District Council of Yorke Peninsula, which is in my electorate.

This has been quite an emotive issue—across the Yorke Peninsula, certainly. There were many people, some 14 or 15 months ago, who were particularly upset, and there was an increasing recognition within council of a need to change its waste collection and disposal methods. In many cases this was forced upon it. Council pursued the option of a three bin system with a service charge levy, which had not been applicable before, and suddenly people thought, 'Now we're doing something we don't want to do.'

For those who lived in the towns the collection continued as normal, it was no different; and for those who lived on a route between the communities and who were able to have a collection continue, it was no different. However, it created an enormous challenge for those people who were now required to collect the three bins, transport them to their homes, put their waste in them, and then try to get the bins to collection points—especially the older members of the community. I believe the petition of 742 people, which I presented to the house, evolved as a result of the thoughts and worries around that.

I have had some conversations with council about this, and it gave a commitment that it would review its waste collection methods—and, in fact, council did change some of its collection routes. It has been quite open about the fact that it has tried to provide a solution that it feels is best for the majority of people, recognising that not every one lives on a route and is therefore able to have their waste collected from the front of their property.

This section has created a lot of concern. The council is very worried about the fact that the introduction of some form of partial application of the service charge will create difficulties for it, and about how, in fact, you measure that. However, I am also very respectful of the fact that even though the wide community support for the expression of worry about this has reduced—and I think it is fair to say that—it is not universal.

There are some sections of the community in some of the more remote areas of the Yorke Peninsula council (remembering that it is some 200 kilometres long and has over 3,000 kilometres of unsealed roads and 400 kilometres of sealed roads—it is a very extensive road network) where it is impossible to collect from every property.

The council did try to make some progressive changes to this. It has tried to work with the community. I do regret the fact that it did not hold a public meeting early on, which I recommended that it do because then it would have given the opportunity for the community to actually come forward to ask questions before the implementation of the system on 15 October, but the council chose not to and probably wishes now that it had done that.

It is appropriate that the community's concerns are brought forward. I do recognise that minister Gago has introduced this clause 22 as a result of the contact that she had with people from Yorke Peninsula. The Hon. John Darley has expressed a lot of concerns too. The council has had ongoing discussions with the Hon. Mr Darley and the minister, and I just hope that what we have now will allow some surety to exist for the service provider and some surety on what the cost of providing that service is but also some surety for the people of Yorke Peninsula who do need their waste to be collected—there is no doubt about that.

It has been a difficult and emotional issue. It has calmed down to some level but there are still some people in the community who are very upset by what has transpired and, in fact, what they consider to be a service that does not meet their needs. I recognise that having to transport your bin potentially 15 kilometres to a collection point in the community is an enormous challenge.

I hope that we can work through the situation to ensure that a system is put in place to provide for not only the needs of the community but also the revenue stream that the council needs to fund this service. I think off the top of my head that an additional $600,000 cost has been levied per year (which the council has to fund) to ensure that waste is collected, separated, recycled, where possible, and that landfill waste is actually taken away from the area. I commend the shadow minister on his contribution, and I look forward to the swift passage of this bill through the house.

[Sitting extended beyond 17:00 on motion of Hon. J.M. Rankine]

The Hon. J.M. RANKINE (Wright—Minister for Families and Communities, Minister for Northern Suburbs, Minister for Housing, Minister for Ageing, Minister for Disability) (16:57): I thank members for their contributions in relation to this legislation. It is a little bit confusing, however. We have the shadow spokesperson coming in here one day saying that we are dragging the chain on legislation and now he is complaining because we have some legislation before the house. One would think that they do not necessarily want to be working on their last day. It is nice to—

Mr Griffiths interjecting:

The Hon. J.M. RANKINE: You were complaining that we were dealing with this on the last sitting day of the parliament.

Mr Griffiths interjecting:

The Hon. J.M. RANKINE: As I said, one day we are dragging the chain and the next day we are rushing you. We do not seem to be able to please the honourable member. It is nice that he has recognised that extensive consultation has been undertaken in relation to this bill. He was disclaiming that in relation to the Outback Areas Trust but I think very similar processes were undertaken.

This legislation is really all about ensuring that members of the public have confidence in their local government. We know that local governments, whether they are big or small, collect taxes and, in many instances, have budgets of tens of millions of dollars. So, it is really important that there be proper management, accountability and auditing of not only the actual accounts but the processes that underlie the spending of that money. I indicate that the government has one amendment that it will pursue in committee. I thank members for their support of the bill.

Bill read a second time.

Committee Stage

In committee.

Clauses 1 to 26 passed.

Clause 27.

The Hon. J.M. RANKINE: I move:

Page 14, lines 5 to 40, page 15, lines 1 to 18—Delete subclauses (2, (3) and (4)

These three subclauses inserted in the other place are not only flawed in concept but they are unworkable in practice. The three subclauses would invite council ratepayers to take up a petition to prevent a council from revoking the community land status of a parcel of community land. The clause goes on to describe how a petition might trigger a poll of electors, but it is obvious from the structure of these three clauses that a poll of electors would never be held.

Under the amendment, it is the receipt of a petition itself that stops any proposal to revoke the community land status. A poll of electors is not required. The petition alone thwarts any previous decision of the elected council to revoke the community land status. A poll of electors is an option that the council, in theory, might choose to pursue to restart the process. However, if a council were to receive a petition with more than the prescribed number of signatures, it would be an exercise in futility then to conduct a poll of electors to try to overturn the demand of the petitioners.

Under voluntary voting, the results of any simple majority poll will be skewed towards rejection, opponents being more motivated to vote than those who agree or do not have an interest. There is no minimum turnout figure for the results of the poll to be valid. Therefore, any poll would predictably endorse the position taken in the petition.

The cost of a poll varies according to the size of the council, but the LGA has estimated that, even for a small council, a poll of electors would cost at least $26,000. For a large council, a poll could cost as much as $200,000. The cost of the poll, in most cases, would outweigh any financial advantage to the community of any proposed dealing with the land. It is difficult to imagine any circumstances in which a council would choose to hold such a poll. Therefore, these three subclauses create a dangerous and unworkable situation, whereby a mere petition could overturn the decision of an elected council.

Mr GOLDSWORTHY: I understand what the minister is saying. She is talking about the amendment which was moved and passed in the other place as being unworkable. I want to reinforce the comments I made in my second reading contribution. This has come from the St Clair issue. If that matter had been dealt with differently and not enraged the local community as it has, then I doubt very much whether this amendment would have been moved. We were prepared to support this proposal in the other place and, in view of that, we do not support this amendment because of the issue that has arisen at the St Clair reserve. As I said, if it had been dealt with properly, we would not be debating this particular amendment now.

Amendment carried; clause as amended passed.

Remaining clauses (28 to 52), schedule and title passed.

Bill reported with amendment.

Third Reading

Bill read a third time and passed.