Suspended Perth lord mayor Lisa Scaffidi (Image: AAP/Richard Wainwright)

For those interested in understanding the art of local government corruption, the 2000-page inquiry report into mismanagement at the City of Perth might be a good place to start. 

The report describes a city captured by the big end of town, awash with undeclared gifts and wracked by a culture of greed and complacency. 

It follows a mammoth two-year investigation by inquiry commissioner Tony Power, who was asked to investigate the council in 2018 after the WA Minister for Local Government David Templeman suspended it over serious governance issues. The report was released on Tuesday.

It’s the largest and most extensive inquiry of a local government ever conducted in Western Australia and perhaps one of the biggest in the country. 

So what does it reveal about the state of local governments in Australia? 

Cultural problems

Power found that the council was plagued by widespread cultural and systemic failings.

Councillors and candidates used sham leases to become eligible to stand for election, and council members regularly used their position to advance their personal financial interests.

Power found there were repeated failures to disclose gifts from event organisers gunning for council sponsorship, including the Perth Fashion Festival and the Hopman Cup.

He described a culture of self-interest and a lack of transparency that had thrived under suspended lord mayor Lisa Scaffidi, who has been in long-running disputes over her failure as mayor to declare thousands of dollars worth of travel, including a BHP-funded trip to the Beijing Olympics worth $36,000. She also failed to disclose a major financial interest she had in a hotel that received a heritage listing from the council.

“These traits have proven fertile ground for greed, incompetence and mismanagement to flourish,” the report found.

Power has referred 135 matters stemming from the inquiry to police and other agencies. Ex-councillor Jim Adamos has already been charged over allegations uncovered by the inquiry.

‘Wake up call’

Templeman described the report as a “big wake up call” for the entire local government sector. 

“I urge everyone in local government to read this report and understand the implications for the sector,” he said. 

He said it revealed what happened when “governance breaks down and members overreach their responsibilities and interfere in the administration”.

The report recommends a whole suite of changes to prevent local government corruption, including a code of conduct for all council members. 

“Some council members and some employees alike have been allowed to put their own interests ahead of the interests of those who they should be serving,” it said. 

But the City of Perth is already staring down another conflict of interest issue ahead of the next mayoral election in October.

The lead candidate, TV personality and AFL commentator Basil Zempilas, has a long affiliation with Perth billionaire Kerry Stokes’ Seven West Media, which controls The West Australian and owns property in the CBD.

Zempilas has tried to brush off claims his employment at Seven, where he writes a column for The West, is a problem, saying “everybody has conflicts”. But the timing of the report is unlikely to do him any favours.

“I’m bemused, bewildered how Basil thinks he can do the job of mayor while being an employee of Kerry Stokes,” Zempilas’ opponent, former magistrate Tim Schwass, told Nine News Perth last week.