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Inquiry into alleged breach of the Local Authorities (Members' interests) Act 1968

28 April 2009

We have completed our inquiry into an alleged breach of section 6(1) of the Local Authorities (Members’ Interests) Act 1968 (the Act) by Thames-Coromandel Mayor Philippa Barriball. The alleged breach occurred at a meeting of the Thames-Coromandel District Council (the Council) on 24 February 2009.

Section 6(1) of the Act prohibits a member of a local authority from discussing or voting on any matter before the local authority in which they have, directly or indirectly, any pecuniary interest, other than an interest in common with the public. Breaching this provision is an offence. The Auditor-General can bring proceedings in appropriate cases.

Background

On 23 February 2009, the Council received a subdivision application for a property owned by the Mayor. The application was a proposed subdivision of the land into three lots, with part being applied for under Rule 701.2 of the District Plan. The Mayor had been considering subdividing the property since 2006 and had previously discussed her intentions with Council staff.

On 24 February 2009, the Council considered a proposed amendment to Rule 701.2 of the District Plan in a session that was closed to the public. All elected members including the Mayor were present, and no members declared a conflict of interest with the proposed amendment.

Outcome of our inquiry

We have decided that bringing proceedings for breach of the Act is not justified.

In our view, it is possible but unlikely that the Mayor breached section 6(1) of the Act by discussing and voting on the proposed amendment to Rule 701.2. In particular, it is unlikely that the decision could have financially affected her through its potential effect on the application for subdivision of her property given the particular facts and the more general requirements of the Resource Management Act in regard to the application. We accept that the Mayor was not aware that the application had been lodged by her agent at the time that the Council was deciding on the amendment, and was not aware that she might have had a conflict of interest that would preclude her from participating in that decision.

We have also considered more generally whether it was in the public interest to bring proceedings against the Mayor. We concluded that it was not, given the circumstances of the matter and the seriousness of the consequences of conviction.

The Act only regulates personal financial conflicts of interest. There are also more general legal obligations on public decision-makers for conflicts of interest, and generally accepted standards of good practice.

In our view, there was enough of a link between the Mayor’s interest in the subdivision application and the decision before the Council to create a risk of an actual or perceived conflict of interest, even if it was not a direct financial interest regulated by the Act. The Mayor should have identified that risk and taken steps to manage it by removing herself from the decision. This would ensure that the decision-making processes of the Council were not exposed to a risk of legal challenge and met general standards of good practice.

We have recommended to the Mayor that she take greater care to ensure that she is able to identify, at an early stage, if there is any potential for her personal affairs to be affected by decisions being made by the Council. It is important not only to manage any risk of an actual conflict of interest arising but also to manage situations where others may perceive a risk of a conflict of interest.

Finally, we wish to note that the Mayor has co-operated fully with our inquiry and within the timeframes asked of her. We would like to thank the Mayor, Council, and Councillors for assisting with our inquiry.

We now consider the matter to be closed.

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