Councillor expenses and allowances: equitable treatment and enhanced integrity

Councillor expenses and claims for reimbursement often attract public attention. Because councils are publicly funded, their systems for managing expenditure are subject to particular scrutiny. The integrity and transparency of those systems are critical for maintaining public confidence in the important work of local government.

Councillor expenses have been the subject of numerous Local Government Inspectorate investigations. These have identified many instances of councillors making false, or inadequately supported, claims for expense reimbursement. It is important for the local government sector to work continuously to improve the transparency of processes surrounding expense reimbursement and to create greater accountability for councillors making expenses claims.

Our review of councillor support involved two main aspects: surveys of councillors and governance staff on the level of support councillors receive, and an audit of several councils to assess compliance with legislation and identify best practice for the benefit of the whole sector. There was an encouraging level of engagement from councils in both aspects of the review, with more than 90% of governance staff providing information and more than 40% of contacted councillors responding to our surveys.

The Local Government Act 2020 contains limited direct guidance as to the kind of resources and facilities which should be made available to support councillors, and in defining the types of expenses which may be considered appropriate. This places a particular onus on councils

to ensure that expenses policies, which provide for the reimbursement of out-of-pocket expenses, meet community expectations.

This review is timely: we have new local government legislation and new opportunities for the State Government and the sector to develop materials to assist councils with navigating the new legislative environment. This review carefully considers a range of issues associated with councillor expenses and provides guidance and insight into the development and application of expenses policies.

Dr John Lynch

Acting Chief Municipal Inspector