Conflict of interest: what's changed

The definition of conflict of interest changed under the new Local Government Act 2020 with the goal of simplifying provisions so they are easier to understand and apply.

Conflict of interest is generally understood to mean when there is a conflict of interest between someone’s personal and civic life, the person with a potential conflict must disclose the interest and not participate in the decision-making process.

The provisions under the Local Government Act 1989 set out exactly what it covered. However, people covered by the new conflict of interest provisions must:

  • consider a broader range of interests
  • consider what an impartial fair-minded person would think.

The intent of the new law is to move from a compliance approach to a principles-based approach with integrity and transparency as the foundations of public office.

For example, the prescriptive approach of the old conflict of interest provisions did not cover a conflict due to a friendship but the new provisions might, depending on the circumstances.

The provisions apply to: 

  • councillors
  • members of delegated committees who are not councillors 
  • council staff who are members of or providing advice to delegated committees or asset committees
  • council staff who are exercising a delegation, delegated function or statutory power. 
conflict of interest form

Local Government Professionals Victoria (LGPro) runs training programs and events which cover conflict of interest to help local government officers understand their obligations under the Act, including a comprehensive Introduction to Local Government workshop.

LGPro President and Northern Grampians Shire Council CEO, Liana Thompson said: “The conflict of interest provisions in the new Local Government Act are far clearer than in the previous Act, giving the community much more transparency into their local government.

“From the officer’s perspective, we need to understand the privileged role that we hold as public servants. While there are times that these provisions don’t directly apply to officers, the intention still does, and good practice means really understanding the principles behind avoiding conflicts of interest.

“While it is not the officer’s place to give advice, we can really help councillors to ask the right questions to help them in their decision making here.”

LGI Operations Manager Ross Millard said: “It is vital that all relevant persons always serve public interest and separate their private interests from their public duty. Only then can the community have confidence in the impartiality of the decisions made by their council.”

More information about conflict of interest has been created in conjunction with the sector and is available on the Local Government Victoria website.