Commission of Inquiry in Ararat Rural City Council: Local Government Minister responds to report

THE Victorian Local Government Minister will Natalie Hutchins will appoint a Municipal Monitor to Ararat Rural City Council for two years and has recommended reforms that will improve community consultation around council rates.

The actions were in response to a report of the Commission of Inquiry into Ararat Rural City Council, which has been tabled in the Victorian Parliament.

The controversial proposal to abolish differential rates that prompted the inquiry could end up being dumped, with the minister urging councillors to revert to the 2016 rating strategy.

Council’s draft budget proposed to bring to an end all differential rates in the city, which would have increased the city’s total rate revenue from farms by over 50 per cent but offered a discount to residential, commercial and industrial property owners.  

The Victorian Farmers Federation, which claimed its members within Ararat Rural City boundaries would be thousands of dollars worse off under the changes, described the report as a “major victory”.  

The report contains numerous findings and recommendations relating to the Council’s rating strategy, community engagement procedures, financial stability and inability to provide good governance.

“I take the Commission of Inquiry’s recommendations very seriously and the appropriate measures will be put in place to ensure Ararat’s ratepayers receive the good governance they deserve,” Ms Hutchins said.

“The Rural City of Ararat Council is on notice – you can’t disregard your community and expect to get away with it.

“Council must take immediate and decisive steps to address these issues, for the sake of their residents, their ratepayers and the community.”

The inquiry’s report criticised Ararat Rural City Council’s decisions in key areas of running a municipal government. 

“The Ararat Rural City Council failed comprehensively to act in the interest of the Municipality on some of the most important functions of any council; namely, the rating strategy, community engagement, the termination of the Chief Executive Officer, appointment of an interim CEO and fulfilling its budgetary obligations,” the report stated.

“These failures were due to poor governance practices by councillors and senior staff.”  

The Minister met with the Council’s Mayor and formally recommended that the Council adopt measures aimed at addressing the report’s findings, including the adoption of the 2016 rating strategy instead of the ‘extreme changes’ proposed in the draft 2017 strategy.

The Minister has also referred the report’s findings on the ‘termination’ of the chief executive officer to the Chief Municipal Inspector and requested that the Mayor address the Commission’s findings into possible breaches of its Councillor Code of Conduct.

The Mayor has been asked to notify the Minister within 28 days of the steps that the Council has taken or proposes to take to give effect to these recommendations.

A Monitor will be appointed shortly to assist the Council in undertaking these actions and to report to on the council’s progress.

The Commission of Inquiry was appointed on June 29 and was tasked with consulting the community on the council’s rating strategy and proposing a better way forward.

“The Commission’s report has been prepared following a series of public and private hearings, an invitation to the Ararat Rural City community to submit written submissions for the Commission’s consideration, and a review of relevant documents provided to the Commission during the course of the inquiry,” the inquiry’s report stated. 

“The report provides recommendations to restore the good governance by the appointment of a Monitor.

“Importantly the report recommends that community harmony and trust be restored by the establishment of an independent Rating Strategy Advisory Group comprising of an independent Chair and representatives of key groups of rate payers.”

Victorian Farmers Federation president David Jochinke

Victorian Farmers Federation president David Jochinke

Farmer reaction

Victorian Farmers Federation president David Jochinke said the report’s recommendations represented a second major victory in their campaign against the rates changes.

Hundreds of farmers have attended community and council meetings since the draft rating strategy was announced. 

Mr Jochinke said he congratulated the strong and committed voice of the Ararat community in building a cohesive case to maintain the differential rating strategy.

“This has been a real community achievement and is a sign of the outcomes we can all achieve if we work together,” he said.

“There has been a lot of anger and frustration in the Ararat community over the Council’s rating strategy, and we’re all relieved to see that we have a way forward.”

Mr Jochinke said he applauded the state government for backing farmers by ordering Ararat Rural City to implement the inquiry’s recommendations in full.

“This has been a terrific outcome for the farmers of Ararat and shows the state government is committed to ensuring our rural communities succeed,” he said.

“We have sent a clear message to all regional councils that the Victorian Farmers Federation will continue to put rural and regional Victoria first, but we need the passion of our members and others in the farming community to achieve real outcomes.”