It's been revealed a former West Wimmera Health Service CEO misused his position by awarding a $1 million contract to a consultancy firm while in a personal relationship with one its directors.
The IBAC investigation found weaknesses in the agency's systems was exploited for financial benefit and the benefit of close associates.
Among other findings, the IBAC report found the organisation had a culture which discouraged employees from speaking up.
The investigation also revealed issues with the oversight of the health service by the Department of Health and Human Services and the health service's board, who failed to correctly oversee the former chief executive's behaviour.
The former chief executive also inappropriately authorised the payment of invoices to a company owned by a relative years after the work was undertaken.
The report also outlines how the former CEO inappropriately expended the health service's funds on travel and hospitality, and regularly failed to comply with policies and procedures.
IBAC Commissioner Robert Redlich said the misuse of funds damaged trust in public institution.
"Public sector employees are expected to maintain strict separation between work-related and personal financial matters and must only use public financial resources for work-related purposes," he said.
"The failure of the former CEO to do this resulted in significant costs to the health service."
West Wimmera Health Service board chair Anne Rogers said the board, along with the executive and management, had overseen extensive changes at WWHS over the past four years, since the former CEO's departure in 2017.
"While these IBAC findings do not relate to the care provided at the Health Service, they are deeply troubling, and clearly demonstrate that WWHS needed a reset," Ms Rogers said.
"We have new leadership, new employment practices, rigorous governance protocols, new organisational values and a revitalised organisational culture."
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