Corruption and Crime Commission head John McKechnie. Pic: YouTube. 

Western Australia’s Corruption and Crime Commission (CCC) has denounced the former Chief Executive of Exmouth Shire Council for serious misconduct after he flouted local government tender rules on a multi-million dollar project; fraudulently charged booze, cabs and hire cars to the council’s credit card; approved his own leave; faked documents; lied and chucked sickies.

CCC head and former Supreme Court Judge John McKechnie QC found that the council’s CEO, Bill Price, did not put a $32 million contract for a science hub and aquarium at Ningaloo Reef out to tender; charged personal expenses to the corporate credit card; approved his own leave or did not log any leave; did dodgy deals for friends and covered up his wrongdoing when he realised the CCC was onto him after council officers tipped them off.

Mr McKechnie said: “Any good that he had done was overshadowed by his arrogation of power. He was a law unto himself.

“Serious misconduct flourishes when there is inadequate governance, whether due to friendship, ignorance or some other reason. Serious misconduct flourished in Exmouth.”

Disgraced Exmouth Council CEO Bill Price. Pic: LinkedIn

He said the CEO should set standards of honesty and integrity for Exmouth Council staff, “If the CEO is rorting the system, how can council, ratepayers or staff have any confidence in the executive?”

The report also slammed the council for showing “stunning indifference” to Mr Price’s egregious behaviour, despite being alerted to it by the CCC. In fact, the council gave him an extra two weeks’ annual leave while the investigation was in full swing.

The council only acted when the Minister for Local Government and Communities, Paul Miles, intervened.

The CCC found that Mr Price:

• Saddled Exmouth Council with a possible $1 million debt after signing a contract with a new company with no assets that it had failed to investigate
• Lied to the council about it and forged documents
• Had never had his leave approved by any of the three councils he had worked in as CEO
• Used the council’s credit card to pay for dinners, hire cars, alcohol and taxis while on leave or relaxing at the weekend
• Faked a sick day and went to the Perth Caravan and Camping Show instead
• Concocted a fictitious rental agreement to give his friend (also employed by the council) tax-free income he was not entitled to

Exmouth Council dismissed Mr Price in December 2016 and the CCC has recommended charges be laid against him. Councillors were suspended for six months and mandated to do training. A new CEO, Cameron Woods, was appointed on April 27.

Mr McKechnie said that Exmouth Council’s failings were symptomatic of the ‘structural weaknesses in local government’ in the state as a whole and said that 34 of the state’s local councils were at high or medium risk of corruption.

 All of the 16 high risk councils were in regional WA and 16 of the remaining 18, which were classed as medium risk, were in rural areas.

The structural weaknesses identified included:

• A culture of entitlement
• Flouting of local government policy
• Very significant procurement and contract management left to administrators who were not necessarily properly qualified, experienced or monitored
• Councillors ill-equipped to manage complex and often high-stakes activities, particularly in procurement and contract management
• Confusion among councillors about what they can ask administrative staff
• Difficulty and conflicts arising for people aware of potentially corrupt activity but reticent to speak up

Mr McKechnie told ABC radio that procurement was the area of council business most vulnerable to corruption, probably because of the risk created by close friendships, particularly in smaller places.

“The issue is in procurement, lax governments and often people who are friends and, quite bluntly, incompetence – people who have not got the skills to manage budgets of many millions of dollars or oversight a CEO who may arrogantly assert power,” Mr McKechnie said.

“If I give you tickets to shows, pay for holidays or renovations at your house at cut prices, who’s to know?

“You have to recognise that friendship is one thing but when you are elected to a position, ignorance is no longer an excuse. You are responsible for governance of that local authority and cannot let friendship or ignorance get in the way of good governance.”

The scandal has led to WA Auditor-General Colin Murphy being given powers to audit local councils in the future.

But WA Local Government Association president Lynne Craigie said the report unfairly tarred all WA local councils with the same brush and she rejected suggestions of widespread mismanagement among the state’s regional councils.

“The local government sector accepts significant issues with a small number of councils and does not set out to defend those who have done wrong, but also should not share in the blame,” Ms Craigie said.

“For the CCC Commissioner to claim that councils have very little idea of their responsibilities or don’t have the required skills is an unfair generalisation and an insult to most who work hard for their communities.”