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Purpose

To outline the process for identifying, declaring and managing a perceived, potential or actual Conflict of Interest.

Scope

This policy applies to Elected Members, Council staff, members of Council committees, members of Local Authorities and contractors and persons employed through labour hire agencies and Council delegates.

Definition and Terms

Conflict of Interest: a conflict of interest occurs when there is a clash between a person’s private interest and their public duty. It involves a lack of impartiality, however arising, and whether or not financial gain or loss is involved.

Actual Conflict of Interest: an actual conflict of interest occurs when it involves a direct conflict between current duties and responsibilities and existing personal interests.

Perceived Conflict of Interest: A perceived conflict of interest occurs when it could be perceived, or appears, that private interest could impact the performance of duties, whether or not this is the case. For example a friend applies for a role being advertised within Council.

Potential Conflict of Interest: A potential conflict of interest occurs where personal interests could conflict with a person’s responsibilities and/or duties. For example, it may be foreseeable in the future that a conflict may arise and steps should be taken now to mitigate that future risk.

Pecuniary Interest: This is an interest that a person has in a matter because of the reasonable likelihood or expectation of appreciable financial gain or loss to the person or another person with whom the person is associated. Associated persons include relatives, partners and employers.

Non-Pecuniary Interest: This is an interest that is a private or personal interest that does not amount to a financial gain or loss but may arise from family, kinship or personal friendship, membership of an association, society or trade union, or involvement or interest in an activity, community, social or other cultural group.

Personal Benefit: Use of confidential Council information to gain improper advantage.

Improper Use of Undue Influence: The use of a Council position to improperly influence others.

Legislation and Reference

Local Government Act 2019  (the Act)
Register Annual Return of Interests
Register Conflict of Interests

Policy Statement

The primary objective of a Member of Council and staff is to perform the functions of their role with integrity and accountability. Conflict of interest identification and declaration is essential to maintaining transparency, equity and impartiality when undertaking decision making and the functions of Council. Consistency in the approach and handling of conflicts of interest instils confidence in the public that a Member of Council and staff will not act prejudicially or improperly.

1. Conflict of Interest

Elected Members and staff must act in the public interest and must not take into account personal interests or any other irrelevant considerations. Conflict of interest means a lack of impartiality, however arising and whether or not financial gain or loss is involved.

A conflict of interest arises where an individual has a private or personal interest, perceived, potential or actual, which could affect their capacity as an Elected Member or staff member to perform their public or professional duties in an impartial manner.

Having a public/professional duty and a private/personal interest does not mean there is automatically a conflict of interest. However, if there is a conflict of interest, how it is dealt with is very important and in doing so, the person concerned must not do anything which they could not justify to the public or which suggests reasonable suspicion of improper conduct or preferential treatment.

Conflicts of interest can be pecuniary or non-pecuniary.

1.1 Pecuniary Interest

A “pecuniary interest” means a person has a reasonable expectation of appreciable financial gain or loss for themselves or for another with whom they are associated.

Pecuniary interests must be disclosed.

A person will be considered to have a pecuniary interest if:

1. They, or a person with whom they are associated has a pecuniary interest.
2. Their spouse, defacto partner, relative, partner or employer has a pecuniary interest (relative includes any of the following – parent, grandparent, brother, sister, uncle, aunt, nephew, niece, lineal descendant or an adopted child of the person or the person’s spouse).
3. They, a nominee, partner or employer are a member of a company or other body that has a pecuniary interest.
4. A person is not taken to have a pecuniary interest if:
   1. They are unaware of the relevant pecuniary interest of the spouse, defacto partner, relative, partner, employer or company or other body;
   2. They are a member of, or employed by, a statutory body or by the Crown; or
   3. They are a member of or a delegate of Council, a company or other body that has a pecuniary interest in the matter, so long as the person has no beneficial interest in any shares of the company or body.
5. A person does not have a pecuniary interest in a matter if the interest is so remote that it could not reasonably be regarded as likely to influence any decision the person might make in relation to the matter.

1.2 Non-Pecuniary Interest

A "non-pecuniary interest" is any private or personal interest which does not amount to a financial gain or loss (e.g. family, kinship, friendship, executive membership of an association, society or trade union or involvement or interest in an activity, community, social or other cultural group).

Elected Members who are members of clubs should seriously consider whether their club memberships could give rise to conflicts of interest in Council matters that may affect the clubs. The greater the involvement with the club, the greater the likelihood of a real or perceived conflict of interest.

In cases of a non-pecuniary interest, employees should not do anything which they could not justify to the public and should avoid any occasion for reasonable suspicion or the appearance of improper conduct or only partial performance of their public or professional duties.

Options for dealing with a non-pecuniary conflict of interest will depend on the circumstances of the matter and an objective assessment of it. Options can include:

1. Take no action because the conflict is assessed as minor in nature;
2. Remove themselves as the source of conflict;

1.3 Potential Areas of Conflict

Potential conflicts of interest can arise in the following circumstances:

Tendering and Purchasing

Example: Council has tendered for the provision of professional services. An Elected Member is employed by a company which has tendered for the provision of these services. This may affect, or it may reasonably be suspected that it could affect, their ability to make an unbiased decision when the tender is considered by Council.

Recruitment

Example: A member of the selection panel has a close relationship with one of the applicants for the job. This conflict of interest could bias, or could reasonably be expected to bias, the decision of the panel.

Gifts and Benefits

Example: A developer seeking a decision by Council in their favour regarding storm water approvals offers an Elected Member free tickets to a major sporting event. The Elected Member’s impartiality when dealing with the supplier could be compromised if the offer was accepted.

Information and Opportunities

Elected Members may have business and professional interests in the local government area they represent. Conflicts can arise if their public positions allow them access to information and opportunities that could be used to advance their personal and business interests.

1.4 Disclosing Conflicts of Interest

Elected Members

Elected Members who believe they have an interest in a matter, pecuniary or otherwise, must declare that interest in any meetings or discussions where that matter is considered.

CEO

If the council CEO has a personal or financial interest in a matter on which they are required or authorised to act or give advice, they must disclose the interest to the council. Offences arise when the council CEO does not disclose their personal or financial interest and acts in the matter in a way other than as authorised by the council. A disclosure by a council’s CEO must form part of a council meeting, as the council may, by resolution, provide authorisation to the CEO to act in a particular way in order to manage the conflict of interest. Disclosure by a council’s CEO to another council committee, or to the President or another elected member, or to a staff member, does not satisfy the requirements of the Act.
When council is considering the authorisation to be given via resolution to the CEO, council’s resolution should be specific on the actual authorisation given to the CEO. A council cannot just note or accept the CEO’s disclosure as this is not sufficient to meet the requirements of the Act. A separate authorisation by resolution of council is required for each instance in which a conflict arises and is disclosed by the council’s CEO.

Staff Members

A staff member who believes that they have an interest in a matter, pecuniary or otherwise, must notify the CEO immediately. Notification to the CEO will occur by completing either the Conflict of Interest Declaration Form (COI) or the Notification of Other/Outside Employment Form (NOE), where applicable. They may only participate or act in a matter where they have a conflict of interest with prior authorisation from the CEO. If the person with the conflict is the CEO, the CEO must have prior authorisation from the council.

Such authorisations must be sought each time the staff member or CEO participates in a matter in which they have a conflict of interest.

1.5 Disclosures at Meetings

An Elected Member who has a conflict of interest in any matter with which the Council is concerned and who is present at a meeting of the Council at which the matter is being considered must disclose the nature of the interest to the meeting as soon as practicable.

The Elected Member who discloses a conflict of interest must not be present at, or in sight of, the meeting of the Council:

1. at any time during which the matter is being considered or discussed by the Council, or
2. at any time during which the Council is voting on any question in relation to the matter.

The attention of Elected Members is drawn to the following criteria to determine the extent of disclosure of the nature of the interest to the meeting necessary to observe statutory requirements of the Act and that some detail of the interest be disclosed and satisfy the requirements of the Act for greater transparency and accountability in the management and operation of the Council:

1. The details are sufficient to enable other Elected Members and the public to appreciate in general terms the connection of the person with the matter under consideration.
2. The disclosure does not reveal sensitive information which is not relevant to the matter before the Council.
3. The disclosure does not reveal information which may be unnecessarily damaging to the reputation of some person(s) with whom the person disclosing the interest is associated.
4. The disclosure will not unnecessarily prejudice a sensitive commercial or legal situation.

Disclosures of interest made at meetings and subsequent actions will be recorded in the minutes of that Council and in the register established for this purpose.
Should quorum be lost due to Elected Members abstaining from involvement in the item being considered, the item will be deferred to the next meeting and permission sought from the Minister for an exemption under the Act.

1.6 Deciding If You Have a Conflict of Interest

The following questions may help in deciding whether an Elected Member has a conflict of interest or whether their conduct could create the impression that a conflict of interest exists:

1. Do I, a relative, friend or associate stand to gain or lose financially from Council’s decision or action on this matter?
2. Do I, a relative, friend or associate stand to gain or lose my/our reputation because of Council’s decision or action on this matter?
3. Have I contributed in a private capacity in any way to the matter before Council?
4. Have I made any promises or commitments in relation to the matter?
5. Have I received a benefit or hospitality from someone who stands to gain or lose from Council’s decision or action?
6. Am I a member of an association, club or professional organisation, or do I have particular ties and affiliations with organisations or individuals, who stand to gain or lose from Council’s consideration of the matter?
7. Could there be benefits for me in the future that could cast doubt on my objectivity?
8. If I participate in assessment or decision making, would I be happy if my colleagues and the public became aware of my association or connection?
9. Would a fair and reasonable person perceive that I was influenced by personal interest in performing my public duty?
10. Do I need to seek advice or discuss the matter with an objective party?
11. Am I confident of my ability to act impartially and in the public interest?
12. Do I understand the possible penalties if I go on with the action?

Note: The references to “before Council”, “Council’s consideration”, etc. also refer to issues to be dealt with under delegated authority by Council officers.

1.7 Responsibility for Making a Disclosure

If an Elected Member or staff member is unsure as to whether or not they have a conflict of interest, they should give full written details to the Chief Executive Officer or seek independent legal advice. The objective of notification is to protect Elected Members, staff and Council.

The Chief Executive Officer does not have a responsibility to provide a determination on whether or not an Elected Member has a conflict of interest in a matter.

The responsibility for determining whether an Elected Member has a conflict of interest rests with the individual Elected Member, as per the Local Government Act. In many cases, only the Elected Member will be aware of the potential for a conflict of interest. Elected Members are encouraged to err on the side of caution by declaring their interest and by not participating in discussion or in decision making if there is any doubt as to their interest in the matter.

1.8 Roles and Responsibilities around Conflict of Interest Management

It is the role and responsibility of managers to:

1. Ensure staff are aware of their obligations to notify Council of any other employment.
2. Assess notifications of other employment to determine whether there is a conflict of interest which could impact on staff’s official duties.
3. Document where applicable in the “Notification of Other/Outside Employment Form (NOE)”.
4. Ensure any other identified conflicts of interest that may arise as a result of the other employment, are documented as required in the “Conflict of Interest Declaration Form (COI)”.
5. Develop strategies to manage any conflict of interest and complete a conflict of interest management plan.
6. Regularly review the conflict of interest to assess the relevance of mitigation strategies and update the conflict of interest declaration form and conflict of interest management plan as necessary.

It is the role of People and Culture to manage the NOE and COI forms and registers for staff. Including saving all records of assessment and decisions made in relation to a conflict of interest.

It is the role of Governance to maintain and manage the COI forms and registers for Elected Members.

It is the role and responsibility of staff to:

1. Declare any actual, perceived or potential conflict of interest and complete a “Conflict of Interest Declaration Form (COI)” or the “Notification of Other/Outside Employment Form (NOE)”, where applicable.
2. Participate in strategies to resolve and/or manage any conflicts of interest.
3. Immediately inform People and Culture and/or the Chief Executive Officer if any suspected fraud, misconduct or corrupt conduct is identified in accordance with Council’s policies and procedures.

Conflict of Interest Management between Close Family Members

If close family members work in the same directorate the following steps are taken to avoid any conflict of interest (actual, perceived or potential) in connection with their employment:

1. Altering staff duties so they are no longer performing the role which may potentially put them in a conflict situation.
2. Allowing the staff to continue in the same roles but implement appropriate safeguards which address the conflict of interest, i.e. not authorising close family members timesheets, leave, overtime/TOIL, allowances (if outside of the employment contract) purchase orders and not managing probation periods or performance and developmental reviews. Personal issues between close family members and any disciplinary issues that may arise, will be addressed by an alternate manager.

1.9 Monitoring Conflicts of Interest

Management monitors actual, perceived and potential conflicts of interest through six monthly and annual reviews. The annual review includes a mandatory annual declaration of “no conflicts’’ for staff with relevant delegated authority to authorise procurements.

1.10 Breach of Policy

Failure to disclose conflict of interest transactions will be deemed a breach of this policy and will be followed with disciplinary action. If applicable, criminal proceedings will be brought against the offender.

1.11 Complaints Regarding Failure to Disclose an Interest

Any person may make a complaint that a person has or may have failed to disclose a conflict of interest. All complaints should be directed to the Chief Executive Officer, the Chief Executive Officer of the Local Government Unit within the Department of Chief Minister and Cabinet.

Privacy and Freedom of Information

Collection and storage of personal information is governed by Council’s Privacy Statement, the Privacy Act 1988 and the Right to Information Act 2009. Information provided by Elected Members, staff and any other members under this Policy shall be held for the purpose of compliance with Council’s legal obligation and shall be disclosed where required for compliance or legal reasons only.

Reporting

The Chief Executive Officer will:

1. Review and recommend management strategies for all staff conflicts of interest;
2. maintain a register of disclosed conflicts for Elected Members and staff;
3. ensure the conflicts of interest policy is kept current; and
4. arrange investigations of possible conflicts of interest as required.

Review History