Select Committee proposed to investigate QLD Council Corruption

Through the Local Government Association of Queensland (LGAQ) Ltd the deep corruption that had been culturally entrenched in Ipswich and Logan Councils, is ingeniously and systemically infecting many other Queensland councils.

Senator Malcolm Roberts lodged a Senate motion this week calling for a Select Committee on Corruption in Queensland Local Government to be established to address the gross misuse of Commonwealth and State Disaster Funds, under the procurement practices of LGAQ Ltd and Queensland councils.

Senator Roberts said, “Evidence shows that around 50% of the funded disaster money is siphoned into areas that currently avoid detection and is not used for the benefit of the community.”

“Listening to many contractors and staff state-wide has uncovered a depth of dishonesty with public money that law-abiding citizens will find it hard to believe, but it is true.”

The National Disaster Relief and Recovery Arrangements (NDRRA) is the agency through which councils receive disaster recovery funding. From 2011 – 2019 all Queensland councils received a blockbuster $5.339 billion, 75% from the federal government and 25% from the state.

The LGAQ’s unfettered existence benefits from two statutory provisions. Firstly rule 234 of the Local Government Regulations 2012 exempts a Council from calling for quotes or contractors to tender if the contract is entered using the LGAQ as an intermediary. 

This practice, considered unlawful collusion in all states except Queensland, allows LGAQ’s procurement entity Local Buy, to award disaster recovery projects to “anointed contractors” that can be encouraged to inflate prices, use substandard materials and deliver inferior workmanship to maximise profit.

The other problem is s591 of the Industrial Relations Act 1999, that exempts LGAQ Ltd from appointing an independent auditor to inspect financial records.

Senator Roberts stated, “Access to large sums of disaster money, rule 234 and exemption from financial auditing, allows immunity from scrutiny and transparency creating a hot bed of systemic corruption.

A 2019 audit of Queensland Councils by the QLD Audit Office identified $793 million worth of assets – including roads – missing from public registers of 44 councils during 2017-2019.  The report stated that overspending, incomplete asset registers and systemic poor internal controls were widespread across Queensland Councils making fraud easy to do.

Queensland’s state government and the Crime and Corruption Commission are aware of these alleged corrupt practices and have inexplicably declined to investigate.

Senator Roberts added, “A Senate Committee will ensure an independent investigation, void of political interference, into these corrupt practices. “Every Queensland council should welcome the scrutiny to give rate payers reassurance their council’s governance and fiscal management are both moral and legal.”