Tully hits back at Ipswich council claims
LONG-SERVING Ipswich City Councillor Paul Tully has hit back at claims a council-owned entity spent $50 million on a redevelopment that never eventuated.
As reported earlier by The Courier-Mail, Queensland's Local Government Minister Sterling Hinchliffe has tabled three reports in Parliament which detailed evidence of potential fraud and breaches of the Corporations Act.
The Minister said the reports show he was right to move to sack the council, and appoint administrators.
He said Ipswich City Properties, a company 100 per cent owned by the council, spent almost $50 million of ratepayers' money on a CBD redevelopment that never eventuated.
Mr Tully is listed as the chair of ICP and has said he's yet to see the reports, but strongly denied taxpayers' money had been squandered. "I haven't seen what they have put out this morning … but all of the information will be refuted," Mr Tully said.
"We sold the first building in 2012 for $93 million … to say nothing occurred is spurious. That's occupied by state public servants.
"When you have a development plan over 20 years, you don't make all your money over five years."
He said the council was meeting this morning to discuss the reports. Mr Hinchliffe says Ipswich City Council-owned entities "have been acting as a law unto themselves".
"Until recently, these entities have been run on a whim by Councillors and Council officials, without the best practice of oversight from independent directors."
Expenses associated with ICP included private jets and all-expenses paid overseas travel for officials, including councillors and staff, to the US in 2010.
Mr Hinchliffe said the council tried to conceal its lavish spending by using $83,000 of ratepayers' funds on high-priced lawyers to fight Right to Information requests.
Accusations against ICC-owned entities include the sale of commercial and residential land without testing the market, failure to lodge audited financial statements, failure to sign off on board minutes, and allowing officers of the controlled entities to sign off on their own travel costs.
Mr Hinchliffe will next month introduce special laws to dismiss the council after 15 people with council links were charged with more than 70 corruption and related offences.
EARLIER: Ipswich council body 'squandered $50m ratepayer cash'
UP to $50 million in Ipswich ratepayer cash was squandered by a secretive entity owned and wholly run by Ipswich City Council, damning new audit reports allege.
The reports, prepared by advisory company McGrath-Nichol at the request of council and later handed to the Department of Local Government, reveal serious issues with the way five entities controlled by Ipswich City Council including Ipswich City Properties, were run.
They were tabled in parliament by Local Government Minister Stirling Hinchliffe on Monday night. Ipswich City Council could not be contacted for comment on Monday night but has previously stated ICP had only incurred losses of $15.5 million over five years.
ICP was set up to spearhead the redevelopment of the Ipswich CBD however the reports show the body incurred up to $50 million in losses with ratepayers still waiting for the redevelopment to happen.
It further alleges ICP failed to lodge audited financial statements and prepare a directors report in an alleged breach of the Corporations Act.
ICP struck a deal with developer epc. Pacific to redevelop the Ipswich CBD.
The report found ICP "could not demonstrate it had achieved value for money through its expression of interest campaign where EPC was selected as the preferred developer".
To get out of the contract, epc. Pacific estimated it would suffer a loss of $16 million, according to the report.
"In order to agree to the termination or variance in the contracts, EPC requires that its costs incurred of $7 million be paid by council and or ICP," the report states.
The audit also found council forgave a $34 million loan to ICP in 2016 "resulting from the impact of historical economic conditions on the pace of redevelopment activities on the Ipswich City Square".
In one instance ICP made a $10,000 donation to the Red and White foundation linked to Ipswich Grammar School.
Three directors declared a conflict of interest as their children attended the school but the donation was approved.
"The contribution to the Red and White Foundation does not align with ICP's objectives as specified in its constitution," the McGrath-Nichol report stated.
McGrath-Nichol also raised questions over the sale of a $2.8 million block of land at Redbank Plains by entity Ipswich City Developments without going to market first and took issue with the process undertaken to award the contract to redevelop the city centre.
The audit also considered council-owned entity Ipswich Motorsport Park Pty Ltd and identified unsigned board minutes.
The audit found this indicated a "lack of compliance, responsibility and accountability" and may result in a breach of the Corporations Act.
"IMP was unable to provide sufficient documentation that could demonstrate the conduct of the process of awarding a contract for the final design worship of the Queensland Raceway achieved value for money, open and effective behaviour and fair dealing," the report found.
Local Government Minister Stirling Hinchliffe said the McGrath-Nichol reports revealed a culture of "secrecy, entitlement and lack of accountability" at Ipswich City Council.
"This has led to questionable transactions and dud deals which have saddled Ipswich ratepayers with massive costs with generating next to nothing in return," he said.