Don’t think banks should be involved in Super?

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Published: Tuesday, 28 August 2018 15:00

Given the Royal Commission, who would? But sometimes, while it’s been hinted Government needs to do something about separating off financial planning and superannuation from banks, these things do need a bit more encouragement to give them momentum.

The ACTU, now rebranded as Australian Unions, has a petition calling for precisely that.

If you’d like to sign the petition, use this link.

But what do the regulators do?

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Published: Tuesday, 28 August 2018 15:00

The Australian Prudential Regulation Authority is charged with the responsibility of regulating superannuation funds and ensuring their compliance with the Superannuation Industry Supervision Act 1993.

As I’ve spent 16 years as a director on the LGS Board from its inception in 1997 to 2013, I’ve enjoyed a good relationship with APRA and what can be their personal views pushed as government policy, or the “house view” of the regulator.  To an extent, that relationship continues.  depa is one of the shareholders of LGS Proprietary Limited.

In recent years APRA has published their own assumptions about the benefits which flow to industry superannuation funds by including purportedly “independent” directors on the board to complement the normal “equal representational model” of equal numbers of employers and employees.  They regard it as best practice even though there is no evidence yet published to support that view.

It’s hard to talk about the regulator when every meeting or discussion begins with their disclaimer. Not a financial disclaimer about all the risks you take in dealing with them, but a reminder that so much of what they do, and so often spoken of only in a general and non-specific sense because that’s how you get the best responses, is subject to section 56 of the Australian Prudential Regulation Authority Act 1998 “Secrecy-general obligations”.

This section provides a series of offences which involve criminal penalties including imprisonment for up to two years. Not for me the risks of the showers, thanks!

And it is a strange irony that the SIS Act requires “a general flavour of disclosure” by superannuation funds supervised by it.  When a fund’s commitment to disclose clashes with a regulator’s potential restrictions on confidentiality, and is fraught with risk of imprisonment, it’s hard to disclose and be transparent on things members have a right to know about.  Or to know what can be said and can’t be said, and the reason why.

So, say no more, as they say, maybe next issue...

Nick Kaldas to audit corruption risks in New South Wales planning

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Published: Monday, 30 July 2018 14:01

On 28 July Jacob Saulwick in the Sydney Morning Herald announced “the former deputy commissioner of the NSW Police, Nick Kaldas, will conduct an audit into corruption risks in the State’s planning system, following a string of high-profile scandals.

“Planning Minister Anthony Roberts has handed Mr Kaldas a broad brief to scrutinise risks in the system and ‘make recommendations in relation to the decision-making governance of state and local agencies’.

“The appointment of Mr Kaldas, who is to report at the end of November, comes on the back of the Independent Commission Against Corruption’s enquiry into the conduct of councillors and senior staff at the former Canterbury Council.

“This is about building a planning system that people can have faith and confidence in,” Mr Roberts said.

“We want to be held up around the world, that if you want a robust, strong and transparent planning system, have a look at NSW,” he said.”

Wow, the only people held up on planning issues in NSW are the hapless citizens of New South Wales - held up, hands in the air, metaphorically speaking, while their amenity, quality of life and relaxed neighbourhoods are ransacked, high-rised and looted by rapacious developers. And not helped by councils over-riding the recommendations of planning professionals because the government has not yet committed to introducing Local Planning Panels outside the Sydney Metropolitan and Wollongong area.

We all deserve so much better yet, but whether it be Auburn, or Canterbury, it just seems to get unspeakably worse.

The Herald article refers to terms of reference for the audit but these are not yet publicly available. We have already approached the Minister for Planning for the terms of reference and the opportunity to make a submission.  We also provided the Minister’s Office with our submission to the ICAC and our suggestions to reduce corruption in New South Wales planning.  It’s about time the Minister got his finger out as well.

We are delighted to see Nick Kaldas given the job. The bloke who should be the Police Commissioner always looked like he could sniff out a crook at a hundred paces, or places where crooks could do business.  And is there anywhere more lucrative than the planning system?  Go, Nick. 

And while we’re looking at what’s happening in Operation Dasha, here are three things that beggar belief:

“I need to see you at the gym”

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Published: Monday, 30 July 2018 14:01

Jimmy Maroun doesn’t look like a bloke who spends a lot of time looking after his body in his home gym, or anywhere else. Described in the SMH on 21 July as having “a smoker’s cough, a gambling habit, and a fondness for parties”, he is the subject of interrogation at the ICAC for his propensity to arrange workouts in his home gym with his friends, former Liberal councillor at Canterbury Michael Hawatt and former Labor Councillor Pierre Azzi , who are being investigated by the ICAC.

We all know the disappointments of your body not quite responding as fast as you’d like to an exercise or fitness program, so we can sympathise with Mr Maroun, and we know people have invested heavily in home gyms only to find they haven’t had the results they were looking for and then wanted their money back, because they still look heavy-gutted and unhealthy.

But, as revealed at the ICAC, bank records show that anytime Mr Maroun texted the two former councillors “I need to see you at the gym”, his bank statements showed that he had withdrawn thousands of dollars of cash in the days prior to meeting his friends for a work out. And where the gym junkies’ bank records showed similar amounts of cash, in similar denominations, would be deposited into their bank accounts, days after the workouts.  Presumption of innocence and all that, of course, but uh oh …

The inquiry into the former Canterbury is a slowly unfolding multiple car crash from which it’s hard to avert your eyes. As a surprise bonus it’s already caught and brought down the member for Wagga Wagga, and who knows where else it could lead. After all, developers like Mr Maroun do work in other local government areas as well...

As further amusement, Mr Maroun was being interrogated by the ICAC counsel assisting and this transaction occurred:

Counsel:              I want to suggest to you that you’re trying to make out a state of ignorance which is very, very, very unlikely in your case...

Maroun:               a state of?

Counsel:              ignorance.

Maroun:               what do you mean by that?

Well, say no more...

Councillors on interview panels

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Published: Monday, 30 July 2018 14:01

One of the people of interest being investigated is the former Director of Planning Spiros Stavis. Two days of evidence last week and listed for a further five days of evidence this week, Stavis is under intense scrutiny.  It was revealed that he was in serious financial trouble when he applied for the job of Director of Planning at the former Canterbury. 

As part of that process, he exchanged text messages and met with the former GM Jim Montague and the two councillors Michael Hawatt and Pierre Azzi, was provided with “sample questions” prior to the interview and was interviewed by a panel that included those two notorious fitness fanatics.

The 1993 Local Government Act dramatically drew a line between the role of councillors and Council and the role of the general manager. No longer was the old town or shire clerk the chief “administrative officer” pushed around by councillors, the general manager was the chief executive officer.

Councillors were restricted to the establishment of policy and the day-to-day operation of the Council was legislated as a clear and unequivocal responsibility for the GM.

The Council has a responsibility under section 8A(1)(i) to be “responsible employers and provide a consultative and supportive working environment for staff”.  That’s a pretty recent amendment, so if it’s not clear your Council is doing that, maybe they haven’t caught up yet? 

Other than that broad responsibility as part of the exercising of general functions, the Council is required at 332 to determine the structure but only in so far as the senior staff positions and the roles and reporting lines of senior staff. That means, the Council determines the number of directorates, or Deputy GMs or whatever.  And that’s it.  The rest of it is the GM’s call.

(As an aside, we know there are examples where councillors, particularly the Mayor, do have a role in the structures and the appointments below the senior staff level. That’s a clear breach of 332(1A) but a story for another day.)

Section 332 provides their final responsibility - to be consulted by the GM on the appointment and dismissal of senior staff by requiring that the general manager “may appoint or dismiss senior staff only after consultation with the Council.”  That didn’t happen at the former Canterbury - the two infamous councillors making contact with a candidate, meeting with him, exchanging text messages, apparently favouring their own candidate by ensuring that the GM provided questions prior to the interview and ensuring their bloke got the job by sitting on the interview panel.  Not a good look.

Councillors sometimes sit on interview panels across the industry but it should never happen again.

When we made our submission to the ICAC on 23 May offering solutions to the problems being identified in Operation Dasha, we stressed that we may have other suggestions after we see what was revealed in that investigation.  Clearly keeping councillors off interview panels and away from candidates needs to be part of our second submission as the grubby evidence continues.

The BPB is not just using “intelligence”, it has “intelligence cells”

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Published: Wednesday, 27 June 2018 14:50

There are spies and informants everywhere. In the May issue of depaNews we reported on the BPB’s acknowledgement that they can use multiple informants and intelligence in a way that challenged the original expectation of local government and the BPB about how complaints would be investigated.

It was always understood, because the BPB told us this is how it would work, that someone would make a complaint to a Council about a Council accredited employee and if the complaint was also made at the same time or subsequently to the BPB, then the BPB would acknowledge the investigation conducted initially by the Council and provide significant weight to the Council’s consideration in any action from it.

So, when we found ourselves with a member where an investigation had been triggered without any complaint and where the BPB was resistant to disclosing how the work of the Council certifier came to be the subject of an investigation, we had to find out what was going on.

We met with the Director of the Building Professionals Board Lynelle Collins and the Manager Investigations Sean Fagan. At least Sean has a history in local government (Parramatta and Blacktown to name two) and while he has been out of the industry for some time, he does know what certifiers go through on-site.  Ms Collins, initially reluctant to disclose anything was not quite so forthcoming.

To say that the reception Vice President Jamie Loader and I received was cool and unwelcoming makes it sound a much more warm and welcoming meeting than it really was. Talk about trying to get blood from a stone.  Gone are the days of the warm embrace of former CEO Neil Cocks and Chair Sue Holliday.

No concessions were made about why the investigation happened although we think our guess was right - that the Department of Fair Trading was already on site with a contractual argument between the owner and the builder, and why not look at other parts of the job while they were there.

Ms Collins said that there were many “intelligence cells” now that the BPB was part of the Department of Fair Trading. Pressed on exactly how many intelligence cells there were she said she was unable to answer that because the Department has multiple roles and in any event, there are plenty of other agencies involved on a site who may initiate investigations, such as the Police, the Fire Brigade or whatever.

In a way, while we joke about spies and spying, the reality is that the Department of Fair Trading (shortly to be part of Services NSW) presents the opportunity for a building site to be the subject of consideration in a way it never was when the BPB was a stand-alone board. While Ms Collins found it “alarming” that we wanted some specified number, we found it equally alarming that she couldn’t, or wouldn’t, provide one.  She said if we wanted to know we should have a look on their website.  You should have a look on their website too.

The upshot of it all is that we are spoiled for imagery now, because the BPB/Department of Fair Trading/ServicesNSW is now more like this:

The upshot of the investigation of the particular Council was that there were no findings made against the employee, so we can remain confident that accredited certifiers employed by councils are doing the job properly and, people who do the job properly have nothing to fear from regulators, many-headed or otherwise.

We think that Ms Collins must have received some unfortunate intelligence about us and our history on the issue of accreditation because while we were nothing but charming, that wasn’t quite how we were received. Maybe things will be better next time.

Next time you have a disagreement about professional opinion …

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Published: Wednesday, 27 June 2018 14:50

Hands up those amongst you who have not, at some stage, had a disagreement with a supervisor, or manager, or director or even GM, about your professional opinion. You know, where your professional opinion as an EHO, or building certifier or planner is rejected by the person you report to who presses you to recommend the opposite.

Too many examples come to mind in our office, including even a GM trying to direct a BPB accredited employee on the content of their decisions!

Section 352 (1) of the Local Government Act 1993 provides “a member of staff of the Council is not subject to direction by the Council as to the content of any advice or recommendation made by the member”.  A Council can direct a member of staff to provide advice or a recommendation but they are prohibited from directing its content.  That’s in 352(2).

This is an issue that comes up in a Council far too often. It’s awkward for an employee to deal with it, we recommend at the very least they keep proper records so that the paper trail shows that they did certain things but ideally, if the boss doesn’t like your professional advice, then the boss should take over providing the advice on the recommendation and sign it off themselves.

But wouldn’t it be nice if section 352 acknowledged that “the Council” also included those acting on behalf of the Council who regularly think it appropriate to direct an employee below them on the content of their advice or recommendation. We’ve been trying to talk the Office of Local Government into this. We have a long corporate memory and know that the Local Government Exposure Draft Bill did include that protection generally but it didn’t make it into the 1993 Act.

The Office of Local Government has agreed with our practical view and we now have their advice:

OLG would agree that where there is a difference of opinion between a professional planner and their manager on the content of a report or recommendation, the appropriate way to resolve this in practice would be for the manager to sign off on the report.

This is a real get out of jail free card for planners who can regularly be stood over to approve something that should be rejected, or reject something that should be approved and can apply equally to differences of professional opinion in public or environmental health or building control.

Don’t underestimate the value of this letter. Print it out and put it on your wall right in front of you and never forget that the OLG agrees that if the boss wants you to do something other than what you think is the right thing, the boss can make that recommendation themselves and sign it off.

This is not just a benefit of depa membership, it’s a protection for all professionals. Those who are not members can consider it a gift.

Look out the BPB is coming after you

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Published: Monday, 28 May 2018 15:46

And this time they’re using “intelligence”.  Is there any word more likely to strike fear into your heart?  Is it the Russians? The Chinese, or just a euphemism for gossip?

The BPB must have run out of complaints about private certifiers and discovered that there was little to investigate in local government, so has decided to take a broader approach to the investigation of Council employees who are accredited certifiers.

When the Government decided it made sense to accredit local government employees, the industry (and not just us) was concerned about how the BPB would handle the accreditation of Council employees and, in particular, how they would manage the dual accountability of an accredited certifier to their employer with a parallel line of accountability to the Board.
 
Would this set up the possibility of parallel, or sequential investigations, if a complaint is made simultaneously to the Council and the BPB, or to the Council first and then to the BPB, or whatever.  And what about penalties?  What if the Council deals with that first in a way that the BPB thinks is insufficient, or the Council nails the employee but the BPB doesn’t think it’s such a big deal?
 
We were assured at the time by BPB President Sue Holliday and the Board that the BPB would rely upon any investigation conducted by the Council.  They would review the adequacy of the investigation, its thoroughness, any penalty that might have been imposed, and then make their own judgement about whether anything else needed to be done.  It was an acknowledgement of the primacy of the employment relationship.

But leaving Griffith aside, complaints against accredited certifiers and councils have been few and far between.

(Griffith was a fiasco, a Council with a very long history of understaffing and under resourcing, failures to provide market rates to attract staff and even now, after their humiliation at the hands of the BPB (depaNews October 2017) the Council has now appointed a Director Sustainable Development who is neither a planner, nor a health and building surveyor.  He is a Certified Practicing Accountant who was previously the Council's Manager Economic Development and Tourism. What could possibly go wrong?)

But now we discover that the BPB in February commenced an investigation into a council employee who is accredited with the Board.  There had been no complaint to the Council, the findings themselves focus on minor administrative matters (as if something needed to be found) but more worrying was how the BPB came to be investigating in the first place.

When our member received a letter from the BPB early this month advising that findings had been made and that he, and the Council, had an opportunity to respond, it was signed off by the Manager Complaints Investigation - a job title with no uncertainty, it’s complaints investigation and that’s it.

The accredited certifier and the Council had no idea how this unexceptional domestic construction site had come to the Board’s attention.  There had been no complaint made to the Council and while lots of advice flowed back from the BPB about those sections of the Act that allow them to conduct investigations, there was no answer to the question.  What was there to hide?

And similarly for us, when we started to chase the BPB, understanding that if this can happen to one of our members, it could happen to all of them, they tried to fob us off as well.

When we claimed it was logical that if the Manager Complaints Investigation was managing the investigation then there had to be have been a complaint, we then received a response from the same person but miraculously, they were signed off as Manager Investigations.  Hard not to smell a rat.

But worse was to come, with email advice from the Manager Investigations to the accredited certifier that the Board was relying upon “intelligence or concerns that had come to the Board’s attention.”  That’s a real WTF moment if ever there was one. Not I.N.T.E.L.L.I.G.E.N.C.E, mind you, because who doesn’t love a supercomputer invented by Matt and Trey, but because that word could mean anything.  “Intelligence” from someone who sits next to you at work but doesn’t like you, a grumpy neighbour who thinks you play music too loud, or resents your success in the local garden competition, a councillor who thinks you’re too vigilant, an ex in a messy relationship separation, who knows?
 
But we’re going to find out.  If the BPB was going to do this they should have individually advised every accredited certifier in local government and the organisations that represent them.  That’s probably only depa at this stage (although we assume AAC and AIBS are scratching their heads) but no-one received any advice or tipoff that it didn’t just require a complaint, that the Council didn’t need to be involved, but the BPB, however they got their information, can decide to investigate you. That’s disappointing.

Here is a link to our letter of 23 May to the Director of the BPB complaining about the circumstances and attaching a couple of email trail is where we have protected the identity of the accredited certifier.  We will be meeting with the Director and the Manager Complaints investigation/Investigations on 13 June, and we’ll let you know how random and dangerous this process can be after that.

We make a submission to ICAC Operation Dasha

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Published: Monday, 28 May 2018 15:46

For decades depa has seen the flaws created when senior staff are appointed on term contracts.  There was always going to be a risk to senior staff giving advice without fear or favour if they are being heavied by councillors or a GM who wants them to do something else when their contract was up for renewal.

There is no protection at all and that’s the whole point of there being term contracts required by section 338 of the Local Government Act being accompanied by section 340 prohibiting any access to entitlements under any industrial instrument, or more importantly, any protection available from the Industrial Relations Commission on dismissal.

It may not have been the plan, but it has delivered up vulnerable senior employees and potentially compromised their advice.
 
38 weeks’ pay and no obligation to provide a reason for the termination has been embraced by many councils - very happy to get rid of good people and do this apparently unconcerned that it costs their ratepayers and the community 38 weeks’ pay, and often a pretty good rate of pay as well, to sack people who don’t deserve to be sacked.  And GM’s do it too, equally as unrestrained by the unnecessary cost.

We’ve seen the misuse of term contracts since their introduction.  We have always tried to do something about it and Operation Dasha, with allegations by the GM of the former Canterbury that councillors were bullying, or blackmailing him, as he put it, to make a particular appointment to job of Director of Planning, is an opportunity too good to miss.  Maybe the ICAC will see the wisdom of removing the fixed terms and recognising these positions as both requiring and deserving permanent employment.  They must otherwise be struggling to understand how this can all happen.

The Office of Local Government has their own barrister, harrying the current GM of Canterbury-Bankstown about the value of the “termination without reasons clause ... in the event that there was a breakdown in the relationship between the councillors and the general manager”.  Full credit to Matthew Stewart for not succumbing to the pressure and we all know that “breakdown in the relationship” means only that the Council doesn’t like the GM, because the GM, for good reasons, won’t do what they want.

It’s also odd that while the State public sector has transitioned almost all of their Senior Executive Service employees to ongoing employment, including those SES employees working at OLG (OMG!) that the OLG continues to defend this anachronistic and dangerous employment arrangement.  There will never be confidence in local government, if employees can be directed on the content of their advice and are afraid to provide advice without fear or favour.

So this is the first problem and the second problem is the overwhelming evidence over the past decade or so in particular, that it was never a good idea for the elected councillors to have anything at all to do with the assessment of a DA – a view now recently shared by the NSW Government, which required Sydney Metropolitan councils to do what Wollongong has been doing, of having DAs dealt with by a Local Planning Panel.  We called for the removal of councillors from DAs in depaNews in July 2017 and the Government responded almost immediately and did so.  It must be the power of the pen.

What we know already about the way business was done at the former Canterbury brings together these two areas of government policy as if they were to storm cells we have been watching on a weather map, gradually getting closer and closer together, then joining with catastrophic results.

The ICAC’s consideration allows us the opportunity to respond to both these areas and we have done so, lodging a submission with the ICAC on 23 May and making some sensible and easily implementable recommendations on both employment protection and planning.  Check it out.

Public hearings for Operation Dasha resume on 13 June.  Let’s see what happens.

You’ve moved house or Council? Don’t let it be a secret

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Published: Monday, 28 May 2018 15:46

It is our business because when the State Electoral Commission posted notices for our 2018 election to financial members, we were surprised how many of you hadn’t kept us up to date with your residential address.  It’s clearly never front of mind when you move (because moving is one of the great stressors in life) and as time goes on, we get fewer and fewer letters, but sometimes we do need to write to you, or the SEC does, and if we don’t have your address, you miss out.

Here is a link to how you can update your information on our website.  Go on, it’s so easy - as a surprisingly high number of members who actually stood for election, but hadn’t told us of changes to their addresses, have now discovered...

Every now and again we remind members about letting us know when you’ve moved from one Council to another and we also remind our delegates to help us out here as well.  It does make life easier for us if we know who our members are at each Council and this month we received email advice from a member who moved from The Hills to Liverpool, followed up by that advice from the delegate as well!  This was almost unprecedented.  Thanks Juliana and Daniel.

Come on, it’s not that hard.