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11 May 2009

Local Government Bill reintroduced into Queensland Parliament

by Barry Dunphy, Jamie Doran, Pat Dwyer

Local government reform is back on the agenda in Queensland with the introduction into Parliament of the Local Government Bill 2009. Although this Bill has the same look and feel as the Bill introduced last year but which lapsed with the calling of the State election, there are subtle differences between them. Councils need to be aware of these changes and take them into account in preparations for the implementation of the new statutory regime.

The 2009 Bill deals with matters that affect the core operations of councils. It maintains the theme of a principles-based approach to local government compliance. Consequently, the 2009 Bill contains minimal prescription in comparison to the range of matters and level of detail in the current Act. Like the 2008 Bill, the 2009 Bill also appears to rely heavily on supplementary requirements being defined by the State through new regulations, which have not yet been made public.

Once enacted, the Bill will repeal the Local Government Act 1993 and the Local Government (Community Government Areas) Act 2004.

Areas which have changed

The areas of the 2008 Bill which have changed include:

  • the express statement that a local law does not bind the State has been omitted;
  • in respect of local government beneficial enterprises:
    • a business unit of a local government is now excluded from the ambit of the enterprise powers;
    • the definition of "enterprise" and the express examples of what would constitute a "beneficial enterprise" have been removed;
    • the requirement to consult with, and have regard to the advice of, professional advisors prior to conducting a beneficial enterprise has been removed;
    • there is a new requirement that in conducting a beneficial enterprise the local government must apply sound financial principles and comply with the Local Government Acts;
  • the financial accountability provisions include a new concept of "financially sustainable". A local government is "financially sustainable" if the local government is able to maintain its financial capital and infrastructure capital over the long term;
  • in terms of the powers imposed on the State for monitoring and enforcing the Local Government Acts, the 2009 Bill expands upon the range of remedial action identified in the 2008 Bill such that remedial action may (at the Minister's discretion) take the form of a direction to the local government to take the action that is necessary to comply with a Local Government Act;
  • there is a new basis upon which a councillor may be removed or a local government dissolved. That is, the Minister may recommend that the Governor in Council suspend or dismiss a councillor or dissolve a local government if the Minister reasonably believes that a councillor or a local government has seriously or continuously breached the local government principles;
  • new miscellaneous provisions have been inserted with respect to:
    • a local government's establishment of a special entertainment precinct;
    • the materials in certain local government constructed or controlled infrastructure (declared to be the property of the local government); and
    • the power of the Minister to require a local government to give the Minister information about the local government area or the local government.

Conclusion

Although it is unclear when exactly the new Bill, once passed, will come into force, Hansard indicates that it may be later this year, so councils need to start preparing.

In our view, the challenge for Queensland local governments will lie in developing sound internal processes and procedures to comply with the principles-based spirit of the new legislation. The State Government has given an assurance that councils "will not be left to fend for themselves" and that "there will be a range of supports available to assist them fulfil their statutory roles and obligations".

Of course, where much of the detail of the new legislative framework will be dealt with by new regulations, there is a degree of uncertainty as to how the new laws will, once enacted, operate in practical terms. Further stakeholder consultation is proposed in the development of the regulations and in undertaking reforms to related legislation such as the City of Brisbane Act 1924.

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.