Two former councillors accepted combined benefits of more than $1 million for promoting the interests of a property developer, a Victorian corruption inquiry has found.

The probe by the state’s independent anti-corruption watchdog IBAC looked at the relationship between then councillors at City of Casey in South East Melbourne, and developer and property consultant John Woodman.

A report tabled on Thursday found Mr Woodman offered financial inducements to achieve favourable planning outcomes from local and state government, and that Casey councillors Sam Aziz and Geoff Ablett promoted Mr Woodman’s interests on council in exchange for payment and in-kind support.

It found that between 2017 and 2019, Cr Aziz received around $600,000 in the form of investment returns, consultancy fees, and cash. In return, Cr Aziz promoted Mr John Woodman’s business interests.

Cr Aziz also received $450,000 between 2016-2019 from other parties with commercial interests in Council’s decisions.

Cr Geoff Ablett received more than $550,000 in payments and other financial benefits from Mr Woodman between 2010 and 2019. Mr Woodman also made donations to Cr Ablett’s state and local election campaigns, including a $40,000 donation received via the Liberal Party.

IBAC uncovered a web of well-orchestrated strategies designed to manipulate Casey Council decision-making processes, buy influence and undermine the effectiveness of the Victorian planning system in exchange for certain benefits.

IBAC

IBAC also found other councillors within Casey Council accepted payments, gifts, or other benefits, in exchange for support on planning matters that favoured Mr Woodman’s interests.

“IBAC found clear evidence of two councillors accepting personal benefits from making or influencing council decisions related to planning or land use,” the commission said.

“Operation Sandon also demonstrated that, as a group, councillors in Casey Council exhibited and tolerated behaviour that did not meet the standards required of them.”

The investigation considered four planning matters involving Casey Council, including two that required approval from the planning minister.

The entire Casey Council was sacked in 2020, partly due to IBAC’s investigations.

Conflicts of interest

 IBAC said not all councillors received a direct benefit in exchange for promoting John Woodman’s or his clients’ interests on council.

However some repeatedly failed to declare conflicts of interest in relation to matters involving Mr Woodman’s interests.

“When several councillors did declare a conflict of interest, they sought to influence how other councillors would vote in relation to those matters,” report says.

IBAC also found Mr Woodman attempted to influence several Victorian government MPs, ministers, and political staff. Between 2010 and 2019, Mr John Woodman’s political donations totalled over $470,000.

As well as exposing improper conduct by numerous individuals, IBAC’s investigation laid bare corruption
risks in planning, political donations, lobbying and council governance.

IBAC

The Municipal Association of Victoria said the behaviour described in the report was unacceptable and MAV would work through the planning recommendations with the sector.

“It is essential that the recommended taskforce meaningfully consult with the local government sector, particularly around recommendations to set up independent planning panels and take statutory planning powers away from councillors,” President David Clark said.

The state’s peak body for local government professionals, LGPro, said the investigation highlighted the urgent need for Victorian Government-led reform for the local government sector.

CEOs disempowered

The report says the investigation revealed that while local government CEOs have the advantage of being able to observe integrity breaches, they lack the authority to act on them.

Also, mechanisms to address poor councillor conduct are slow and lack transparency.

In Operation Sandon, the CEO’s ability to deal with integrity breaches was limited by legislation and the fact that they were directly employed by councillors, the report says.

It calls for reforms to bolster the independence of CEOS and ensure they can response to bad behaviour by councillors.

These include mandating standard employment contracts for CEOs, and making independent council committees responsible for recruiting and employing CEOs.

Sector-wide vulnerabilities

The report shed light on corruption vulnerabilities across the entire local government sector, Acting Commissioner Stephen Farrow said.

“The vulnerabilities revealed by Operation Sandon are not unique to the individuals and matters that were the subject of IBAC’s investigation,” he said.

“It is therefore essential for state and local government decision- makers to be alert to the corruption risks highlighted in this report.”

The report makes 34 recommendations to increase transparency in planning decisions across state and local government, including shifting decision-making from councillors to independent expert panels.

Recommendations on council governance include making councillors more accountable for their council’s governance and better equipped to make informed decisions, as well as introducing tougher responses to councillor misconduct.

The report also recommends the establishment of a taskforce chaired by the Department of Premier and Cabinet to implement the recommendations, as well as those contained in its 2022 report on corruption risks associated with donations and lobbying.

IBAC has called on the Premier to report back by the end of January 2025, and for the ministers for local government and planning report back within 12 months.

Mr Farrow told reporters his office intended to provide prosecutors with evidence.

“Where we have evidence that may constitute a criminal offence we will provide it to the office of public prosecution and it’s a matter for them to make a decision about whether there is any public interest and prospects of conviction,” he said.

“The advice I have is that will be happening very quickly.”