Recommended Resources – The Stringer – Independent News, Investigative Journalism

CCC warns Pilbara councils and miners to avoid misconduct

April 22nd, 2013



Western Australia’s Corruption and Crimes Commission (CCC) has been auditing the practices of Local Governments in the mining boom region of the Pilbara. The CCC has indicated local governments are under increasing pressure to deliver development approvals.

There are four local governments in the Pilbara – and the resource sector are pouring millions of dollars into the shires which has created a pressure upon shire councillors and executives to deliver outcomes favourable to the resource companies.

Three years ago the CCC found that shire councils did not have misconduct protocols and this generated the call for a review.

Last week the CCC tabled a report to the State Parliament which imputed that the resource companies provided shire councils with funds for community projects and infrastructure but these funds effectively came with the sense of strings attached.

“Staff at some Pilbara local governments indicated they felt significant pressure in responding to and delivering outcomes associated with large mining companies, their development proposals and their expectations,” the CCC report stated.

The Town of Port Hedland and the Shire of Roebourne were mentioned in the report. Town of Port Hedland acting CEO Ian Hill was quoted in the report that the resource companies and shires were involved in “large investments of negotiation time and ongoing attention to the companies’ requirements for recognition.”

The Chamber of Minerals and Energy WA pointed out that no allegations of misconduct were made.

WA Local Government Association pointed out that it was the right thing to do for resource companies to assist the Pilbara’s shires in light of the impacts that mining brought to the towns and region.

The CCC prefaced its recommendations to State Parliament. “It is critical that the momentum for change in the four local governments achieved by the Commission’s review is not lost. The Commission has consulted with the Department of Local Government.”

The CCC recommended, “that the Shire of Ashburton, the Shire of East Pilbara, the Town of Port Hedland and the Shire of Roebourne continue to develop a formal, comprehensive and effective misconduct management strategy and system.” The CCC recommended that the four shires report their progress on developing these strategies and systems to the Department of Local Government by June 2013.

The report noted that the Shire of Roebourne “expressed concern that the Commission’s report casts the Shire of Roebourne in a negative light.”

At the time of the CCC’s review the Shire of the East Pilbara did not provide an update of their progress in developing and enabling misconduct prevention protocols.

At the time of the CCC’s review the Shire of Ashburton’s council was suspended and was unable to provide any reports to the CCC. On May 31, 2012, the Shire of  Ashburton reported to the CCC “…that a lack of reporting  of misconduct may be related to the culture of the organisation and may not be that no misconduct exists.”

The CCC prefaced its findings to the State Parliament with, “It is rarely a single issue that gives rise to behaviour constituting misconduct. More often, it is a mix of shortcomings in organisational values, processes and practices – such as inadequate documentation, failure to declare conflicts of interest, lack of adequate internal audit function, lack of supervision, and misplaced trust in the integrity of professional relationships – that underpin misconduct.”

“Local governments around the State regularly negotiate large scale business developments of various kinds. These are typically commercial, residential and industrial developments driven by the interests of the private sector, or infrastructure developments driven by government and community needs, or a combination of both.”

“The financial stakes may be extraordinarily high.” The CCC described that without protocols often relationships between big corporations and the shires can lead to impartiality being lost and “that improper influence may occur and the integrity of processes may be compromised.”

The CCC warned about the escalation of misconduct risk in the Pilbara.

“If misconduct risk is heightened by the scale of business activity, local governments in the Pilbara are facing an escalating risk.”

“Over the next two and a half decades, the Pilbara residential population is expected to grow from 47,500 in 2009 to over 140,000 by 2035. This growth will be largely driven by the State Government’s ‘Pilbara Cities’ initiatives, on the back of the burgeoning growth and demands of the mining and resources industry.”

Large scale investments have already taken place in the Pilbara. The Stringer has visited the Pilbara five times in the last ten months. But sadly despite the towns of Karratha, Port Hedland, Port Samson and the community of Cape Lambert grafted into the Pilbara and with the full suite of services and facilities very little has been done for the small towns of Roebourne and Wickham which are predominately populated by Aboriginal peoples and who continue to languish impoverished.

“Under the (Pilbara Cities) initivate, Karratha and Port Hedland will be developed into cities with resident populations of 50,000, supported by Newman as a sub-regional centre with a population of 15,000.”

Port Hedland is Australia’s busiest port, from its delta major mining companies export resources extracted from the Pilbara from which indeed little has been returned to Aboriginal peoples in terms of a whole of community approach. Super towns are being built but not for Aboriginal peoples. What about Jigalong, Wickham and Roebourne?

The fly-in fly-out population is expected to increase from 2010’s 15,464 to 33,685 in 2020.

In the CCC report it was noted, “Hundreds of millions of dollars of mining company money is being offered to local governments for the improvement and development of community infrastructure through a range of scheme and partnering arrangements. In 2011, the Department of State Development, in conjunction with the Department of Mines and Petroleum, reported a total of $135 billion from all funding sources is either committed, or under consideration, to significant resource and resource-related infrastructure projects in the Pilbara.”

“The Town of Port Hedland and the Shire of Roebourne are at the forefront of the growth and development pressures impacting on the region.”

The CCC report noted “staff at some Pilbara local governments indicated they felt significant pressure in responding to and delivering outcomes associated with large mining companies, their development proposals and their expectations.”

“The situation is complicated by the fact that, in certain cases, mining companies were offering significant financial assistance to local governments.”

Effective misconduct protocols and the managing of conflicts of interests are paramount and where these are lacking it is open slather inadvertent or otherwise. Even the best misconduct prevention protocols and audits can be circumvented but without at least this guidance what hope is there for even a semblance of propriety?

–   The writer of this article, Gerry Georgatos declares an impartiality conflict of interest – he has visited the Pilbara – in particular Roebourne – on his own or via Aboriginal Corporations or via resource companies five times during the last six months. Gerry Georgatos’ investigative journalism in The National Indigenous Times late last year about various conflicts of interests and relationships between Aboriginal corporations, mining companies, and various government bodies led to the then president of the National Native Title Tribunal, Graeme Neates, to launch an external inquiry into ‘how to manage conflicts of interests.’ The findings were due end of March but are yet to be released.

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