Minister delays decision on sacking council until after election

Local Government Minister Stephan Knoll has delayed a decision on whether to replace the Coober Pedy Council with an administrator until after the November local government elections.

Oct 24, 2018, updated Nov 13, 2018
Local Government Minister Stephan Knoll will let council elections run their course before deciding whether to sack Coober Pedy Council. Photo: AAP/Kelly Barnes

Local Government Minister Stephan Knoll will let council elections run their course before deciding whether to sack Coober Pedy Council. Photo: AAP/Kelly Barnes

Knoll wrote to the council last month asking it why he shouldn’t use his powers under the Local Government Act to replace the elected members with an administrator, in the wake of a damning report from the Ombudsman.

In response, the council agreed to the proposal, while contesting the Ombudsman’s maladministration findings against it in relation to its 2016 decision to execute a 20-year power purchase deal with energy company EDL without going through its procurement processes.

However, Knoll has decided that he will allow the newly-elected council to make its own submission about whether an administrator should be appointed.

The council election process is well underway with ballots being mailed out this week. Voters have until November 9 to return their ballot papers.

InDaily can reveal that Knoll has written to the acting CEO of Coober Pedy Council, Colin Pitman, today informing him of the delay to his decision on the council’s future.

“Given the election process has started, I do not intend to take action before it is complete,” Knoll writes.

“Following the election, I will provide the Council with an opportunity to make a further submission to me as soon as possible, before I decide on the most appropriate course of action to take.”

He said that while he acknowledged the council’s request for him to take “urgent action” under his ministerial powers, “any decision to recommend that a council be declared defaulting and that an administrator be appointed is a very serious one”.

“It is therefore critical that my decision making process is fair and ensures that all relevant information and views are properly considered.”

Mayoral candidate and outspoken member of the current council, Justin Freytag, said he welcomed the minister’s decision but the State Government needed to spend time and money to address the problems faced by the outback town.

“I’m happy with the election going ahead,” Freytag told InDaily. “But the fact that we have effectively invited him to install an administrator to fix up the structural problems faced by the council needs to be addressed.”

He said Coober Pedy was the only council in South Australia to have responsibility for basic services such as sewerage, water and electricity – a combination of complex tasks which made its role very difficult.

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In September, Knoll wrote to the council asking it to give him reasons why he shouldn’t replace the elected body with an administrator in response to a scathing Ombudsman’s report which found the council committed serious maladministration in 2016.

In response, the council denied the claims of maladministration, but argued that an administrator was required because the town was suffering from serious financial hardship and internal political strife over “competing development interests”.

The council is also the subject of an Auditor-General’s investigation into its financial management ordered by the previous Labor Government. That report is expected to be completed soon.

If an administrator is appointed, he or she would have the same powers, functions and duties of an elected council and would not be under the specific direction of the Minister.

According to the Local Government Act, the Governor can make a proclamation declaring the council to be defaulting, effectively suspending all members and appointing an administrator, on the advice of the Minister.

Not earlier than three months after suspending all members, the Governor can declare the offices of all members to be vacant and fresh elections can be held, or an administrator can remain in place for up to 12 months, after which elections can be held.

The council’s hybrid-renewable electricity deal is a sore spot in the town.

The council claims it was pressured by the State Government to sign the agreement, which was backed by significant grant funding from the Federal Government’s renewable energy agency, ARENA. The State Government has rejected that assertion.

InDaily has reported that State Government bureaucrats played a role in negotiating the deal with EDL on behalf of the council.

The deal’s risks are essentially carried by South Australian taxpayers, via electricity subsidies provided to remote communities.

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