This is the fourth of a series of articles on the staged introduction of the Local Government Act 2020(Vic) (the new Act), which applies to local Councils in Victoria.
Victorian local Councils must adopt a Councillor Gift Policy (CGP) by 24 April 2021 to be compliant with the new statutory requirements set out in section 138 of the new Act.
The CGP must include procedures for the maintenance of a gift register and any other matters prescribed by the regulations (section 138(2)). Councils must also ensure their CGP complies with the public transparency principles set out in section 58 of the New Act.
While the Local Government Act 1989 (the old Act) did not require Councils to adopt a specific gift policy, most Councils will already have a Gifts, Benefits and Hospitality Policy (or similar). The purpose of formalising the requirement for a CGP is to ensure Councillors are not compromised in the performance of their duties by accepting gifts, and to maintain and promote public confidence in the integrity of local Councils. It also complements personal interest returns by ensuring gifts that may be below the threshold for disclosure in a personal interest return are recorded.
What is a “gift”?
The definition of “gift” remains the same across both the old Act and the new Act (section 3):
Gift means any disposition of property otherwise than by will made by a person to another person without consideration in money or money’s worth or with inadequate consideration, including—
- the provision of a service (other than volunteer labour); and
- the payment of an amount in respect of a guarantee; and
- the making of a payment or contribution at a fundraising.
As such, a gift is anything of value (monetary or otherwise) that is offered by an external individual or organisation to a Councillor. Examples include a bottle of wine, gift voucher, tickets to sporting events, and use of a holiday home.
Maintenance of a gift register
The CGP must also make provision for the maintenance of a gift register and any matters in the regulations, including a minimum value of gifts that must be disclosed (section 138). Maintenance of a gift register will enable the Council to monitor the frequency and nature of gifts.
The register should detail:
- a description of the gift;
- the estimated value of the gift;
- the name and address of the gift giver;
- the date of receipt.
Other rules relating to gifts
Gift disclosure threshold
The “gift disclosure threshold” is defined as any gift valued at or above $500 or a higher amount or value prescribed in regulations (section 3).
If multiple gifts are received from a person, they should be treated as a single gift with an aggregate value.
It is an offence for a Councillor to receive an anonymous gift that has a value of or more than the gift disclosure threshold (section 137(1)). A breach of these provisions may result in a maximum penalty of 60 penalty units and a requirement to pay an amount equal to the value of the gift to the Council (sections 137(1) and (3)).
If a Councillor receives a gift when the name and address of the person who gave the gift is unknown, the Councillor must give the gift to the Council within 30 days to avoid committing an offence (section 137(2)).
FAL Lawyers has extensive experience advising on administrative procedures, compliance and governance and can assist local Councils with understanding how the Local Government Act 2020 (Vic) may impact them. If you have any queries or would like to discuss, please do not hesitate to contact us.