Local Government Bill: Minister Maintains Power to Wind Up Council Subsidiaries

Debate on the Local Government package of Bills. i.e.

Local Government Bill 1999,
Local Government (Elections) Bill 1999,
Statutes Repeal and Amendment Bill (Local Government) 1999

took place in the Legislative Council over two weeks: from 27 July to 5 August 1999. For ease of reference on the Democrats web site the debates have been separated into individual pages, each page containing an edited transcript of only one aspect of the total package.

This page covers only Democrat attempts to give local councils more autonomy by removing the Minister's power to wind up a council subsidiary. For an index of other topics covered in the Local Government Bills, see the Democrats Local Government page, or the 1999 Budget Session Index

This does reflect an amendment that I will seek to make to schedule 2, which proves mildly complicating in that respect in that we really need to refer to schedule 2 so that we can make some sense out of this amendment. This clause `Action on a report' provides:

The Minister may, on the basis of a report under subsection 276, require that specified action be taken in respect of a subsidiary.

One of those requirements can be that the Minister require that steps be taken to wind up the subsidiary. However, it is my intention in schedule 2 to remove the power of the Minister to wind up a subsidiary, because it reflects again an oft-repeated claim of the Democrats that we should leave as much as possible and reasonably practicable to the autonomy of the council. I cannot see any reason why a council should not be the responsible body to determine when a subsidiary will be wound up. I refer to schedule 2 so that members have some idea of what I have in mind.

I will seek to include in schedule 2, after line 4, another paragraph to provide that the procedures be followed on the winding up of a subsidiary. This would ensure that procedures required for winding up are included in the charter of a subsidiary established by the council. It therefore would not need ministerial intervention or interference as to how that subsidiary would be wound up. The provision in clause 277 which confers on the Minister this power to require that steps be taken to wind up the subsidiary would be deleted, and it would be left in the hands of the council to ensure that those steps were in the charter of the subsidiary.

The Hon. DIANA LAIDLAW: The Government opposes this amendment. It removes the capacity for the Minister to require that a subsidiary be wound up by councils after a report by an investigator. At the present time this measure provides that if—and only if—there was a problem with the subsidiary the Minister would refer the matter to a council or councils for a report. If the Minister was not happy with the report from the council or the council refused to do so, the Minister could then appoint an investigator, and only on the basis of the investigator's report could the Minister then move to wind up the subsidiary.

The progressive, considered measures here are not the Minister acting simply on a whim: a series of reports and investigations are required before it would come to the stage where a Minister could wind up a subsidiary. All these measures reflect steps that are provided elsewhere in the Bill and the current Act for the Minister to appoint an investigator if a council is not performing well.

In those instances relating to the non-performance of a council, the Minister can appoint an administrator. Because a subsidiary is a different legal entity, we cannot have the circumstances of a subsidiary defaulting or not performing under the circumstances of a council not performing. That is why we must have this different section of the Act under `subsidiaries' and different arrangements for winding up if it is necessary. This reflects all the steps and checks and balances that are required for appointing an administrator for a council when that council is in default or not performing. We require the same sort of pathway for a subsidiary, because it is a separate legal entity from the council.

I highlight that years ago, when I was working with the Hon. Murray Hill, who was then Minister of Local Government, I was involved in the appointment of an administrator at Victor Harbor. It is only at the last resort that such action is taken, and I am not sure whether it has been taken since that time. Whether or not this provision is a last resort, the Government believes it is very important to address an issue, based on an investigator's report which identifies that a subsidiary has defaulted and that the Minister should act to wind up.

The Hon. IAN GILFILLAN: This is another desperate attempt by the Minister and the Government to hang onto control of local government. It really is a cause of some desperation. What is the point of rewriting an Act and referring back to certain matters in the current Act? Why bother about rewriting that legislation if it is such a great piece of legislation? For those who have taken any interest in it, this clause—even with my amendment—allows the Minister to require the adoption of specified management practices, requires a subsidiary to cease a specified activity (and I hope the Minister is listening) and requires that steps be taken to amend the charter of the subsidiary. Is that not enough power? Does that not satisfy the Minister's lust for control over local government? I must say that this attitude of the Government disgusts me.

	Extract from Hansard Legislative Council 30 July 1999

Ian Gilfillan Australian Democrats Member of the Legislative Council		Parliament Index 1999 Budget Session Index Browse by Subject About the SA Parliament Hansard on line