The NSW Ombudsman is examining the legality of the performance improvement order (PIO) imposed on Central Coast Council by the Minister for Local Government Ron Hoenig.
The move comes after a Central Coast resident looked at the fine print of the PIO.
Council Watch has kept the identity of the informant private.
The resident believes a PIO could have been given to the 2020 group of Central Coast Councillors but questions its use on a brand-new group of councillors, still yet to hold their first meeting.
The resident believes PIOs are meant to be early response mechanisms to councils and councillors in the hope of staving off administration, not be used against a council coming out of administration.
It was the wording of the PIO and what’s missing from it, compared to other PIOs given to other councils that the resident noticed.
They submitted a Public Interest Disclosure to the NSW Ombudsman alleging misconduct by the Minister because the wording of the PIO does not meet the requirements of the Act.
Mr Hoenig imposed the PIO on September 19, five days after the council elections, after giving administrator Rik Hart notice of his intention in early September while the council was in caretaker mode.
Mr Hart called an extraordinary meeting on September 6 to table his response.
Mr Hart believed the PIO was a good thing and would keep the new councillors between “the guard rails”.
The PIO would last for 12 months and restrict the decisions the councillors could make; for example, they could not sack the CEO or make any major changes without the Office of Local Government agreeing.
And they had to continue to implement the recommendations handed down in 2022 from the Public Inquiry into the Central Coast held in 2021, after the council went into administration in October 2020 due to financial issues.
The resident said Mr Hart should have asked for legal advice on the PIO.
“One of the things I noticed was one of the earlier councils that had a lawfully issued PIO sought legal advice before responding to the minister with their feedback,” the resident said.
“That legal advice was held confidential, but if Rik Hart had asked for legal advice, then this might have been picked up.’’
The resident says he finds the mistake interesting because all the recent PIOs given to councils not in administration have the correct wording but the Central Coast PIO is missing a section.
Other councils coming out of administration and issued with PIOs are missing the same section.
The section outlines what the consequences would be of failing to meet the requirements of the PIO, and include the option of going into administration.
“Given that the notification does not satisfy the requirements of the Act, it and everything that followed is unlawful,” the resident said.
They said the excluded information would suggest the PIO was being inappropriately used.
In an email seen by Council Watch, an officer from the Ombudsman office confirmed preliminary inquiries had commenced with the Office of Local Government to examine the concerns raised.
