Scope of the examination

Scope of the Local Government Inspectorate's examination into councillor expenses and allowances.

The Inspectorate is the dedicated integrity agency for local government in Victoria. The Chief Municipal Inspector has powers as set out in the Local Government Act 2020 (Act) to enable the Inspectorate to examine, investigate and prosecute any matter relating to a Council’s operations and any breaches of the Act.

An Inspectorate project reviewing support provided to elected councillors has built a picture of the varied approaches to councillor resources and expense

reimbursement procedures across the state. The project assessed what support is provided to councillors, levels of satisfaction with this support and what improvements could be made in relation to support/resources.

The project also examined what kinds of expenses are being claimed and how expenses policies are working in practice with a view to recommending improvements to the expenses process to better meet community expectations.

Section 39 of the Act, which came into operation on 6 April 2020, provides the framework for the payment of an allowance to councillors and mayors. Section 40 governs the reimbursement of councillor expenses and section 41 requires the adoption and maintenance of a Council Expenses Policy. Sections 40 and 41 commenced on 1 May 2020.

In tandem with the new Act, Local Government Victoria (LGV) published in June 2020 a draft Council Expenses Policy to support councils in their requirement to adopt an expenses policy compliant with the new Act by 1 September 2020.1

After two surveys of council governance staff and councillors, the data identified patterns with the management of expenses and allowances, variations between mayors and councillors, and other areas of interest.

The Inspectorate encountered some difficulties in comparing and aggregating the data from the first councillor support survey. This was mainly due to differences between councils in their interpretation of the expense categories and their approaches to reporting on expenses.