Council
1 August, 2024
Councillors break ranks, investigations, election campaigning
Horsham Rural City Council councillors break ranks with public statement
As questions continue about Horsham Rural City Council's late lodging of its 2024-2025 budget, three councillors have taken the unprecedented step of issuing a public statement detailing their concerns about missing the end-of-financial-year deadline.
Councillors Claudia Haenel, Ian Ross and David Bowe broke ranks and issued the press release on Tuesday, July 30 claiming they were not fully informed before the motion to adopt the budget.
The budget was adopted at the council meeting on Monday, July 22, missing the June 30 deadline by 22 days.
HRCC CEO Mr Sunil Bhalla
At this meeting, HRCC CEO Sunil Bhalla explained that the lateness was due to the council's internal changeover to a new accounting program and the ensuing issues officers experienced.
When questioned about the timing of the council's request for an extension from the Minister for Local Government Melissa Horne, Mr Bhalla told the meeting a letter of request had been sent on June 19.
He also informed the meeting that the council had received a letter of acceptance of correspondence from the LGV, but no direct approval from the minister for an extended date had been received.
Clarification of the contents of the letter was provided to the Wimmera Mail-Times in part, by Mr. Bhalla
"On June 19, Council notified the Minister for Local Government of the delay in adopting the budget.
"While we didn't receive a formal reply from the Minister, a letter was received from Local Government Victoria on June 26, which noted that given the timing of Council's letter, it was not possible to consider another date to adopt Council's budget.
"Our budget was formally adopted at the Council meeting on July 22.
"At this stage, the Council has not received further correspondence from Local Government Victoria or the Minister for Local Government on the matter," he said.
Councillors break ranks
Crs Ross, Haenel, and Bowe claim they were not fully informed before they were asked to vote on a motion to accept the budget in the following statement.
"As individual councillors, we are extremely disappointed that the 2024 budget was not presented for adoption before June 30, 2024, with an appropriate community consultation period.
All other RCCC members [ who also installed the new accounting program] were able to achieve their June 30, 2024 deadline.
We believe the appropriate governance position should have been that council resolve to move a resolution, as soon as they were aware of the potential delay, to request an extension from the Minister.
The failure to do so has placed our internal staff under immense pressure and has caused significant reputational damage to the Council.
We believe this has been a failure by our leaders.
If council had been briefed appropriately, then we could have applied for an extension from the Minister, in a timely manner, with a resolution of council.
The relevant documentation regarding the request for an extension, as requested before the budget meeting on July 22, 2024, was only provided to all councillors on July 29, 2024, one week after the budget meeting.
We believe we were not fully briefed with the relevant deadline extension information, as requested before the meeting, where the responsibility of setting the agenda lies directly with the CEO [ Mr Sunil Bhala] and the Mayor [Robyn Gulline]
These are our individual views and not those of Horsham Rural City Council."
Councillor Ross said his concerns about passing a motion on the late budget without approval by the minister were raised at the July meeting.
"The issue for me is we [councillors] were not given a copy of the letter until after the meeting where the motion to adopt the budget was moved.
"The motion was passed without councillors being fully informed and this was a failure of leadership," he said.
This letter from the LGV and its interpretation is being questioned.
Local Government Victoria warning
In addition to Mr Bhalla's statement, the letter from the LGV's Executive Director, Mike Gooey, advised the council that they had breached the Loc Gov Act 2020.
"...the adopted annual budget is the legal instrument by which a council raises lawful rates and charges on properties. It authorises a council's administration to expend the council's consolidated revenue for the financial year.
"Without an adopted budget for 2024-2025 in accordance with the requirements of the LG Act 2020, these may be in jeopardy."
The writer urged Mr Bahalla to seek legal advice.
Mr Gooey also referred to his conversation with Mr Bahalla and said, " As per our conversation, I am obligated to notify the Chief Municipal Inspector of this matter."
The mayor, Robyn Gulline, said at the July meeting that the late lodgement of the budget could result in HRCC being reported to the Loc Gov Inspectorate which could result in an ensuing investigation.
On Wednesday, July 31, the mayor confirmed that the council had breached the Act by lodging the budget after June 30.
"While disappointed, it was not a surprise," she said.
"The Council expected the new accounting program to go live in November 2023, but circumstances beyond the council's control created delays, which didn't occur until March 2024.
"Council officers had a clear goal to be ready by June 30, but codes and variables with the new program created additional and time-consuming work.
"Mr Bhalla communicated with the LGV in the months before June 30, making them aware of the challenges and possible late lodgement of the budget.
"When it became apparent that the council would breach the Act with a late lodgement, he wrote to the LGV on June 19 requesting an extension as per his statement at the council meeting on Monday, July 22," she said.
"The Council held ten budget briefings in the months before this, and councillors were aware of the possible late lodgement in advance.
"In my role as mayor, I have an obligation to adopt the council's budget, which was done at Monday's meeting on June 22," she said.
Local Government Inspectorate
In response to the Wimmera Mail-Times request for information, the office of the Local Government Inspectorate said, "The Local Government Inspectorate treats its investigations with the strictest of confidence and as an integrity agency, we are unable to share any details of an investigation, ongoing or otherwise, with the media."
Crs Robyn Gulline, Les Power, Penny Flynn, and Bob Redden voted to adopt the budget at Monday's council meeting, July 22
Crs Ian Ross, Claudia Haenel, and David Bowe voted against the motion.