Officials to investigate alleged developer donation to ambitious Sydney mayor

Officials will investigate a $5900 donation to Sutherland Shire Liberal mayor Carmelo Pesce which Labor claims was unlawfully made by a property developer, while the NSW government launches a random “spot check” of councillors’ declared interests.

Pesce, who is a contender for state or federal politics, potentially in former prime minister Scott Morrison’s seat of Cook, said he had “no problem” with the 2016 donation being investigated and was confident there was no substance to the claim because the donor had ceased working in property development at the time of the donation.

Sutherland Shire mayor Carmelo Pesce believed Labor raised the 2016 donation as a political attack ahead of his possible move into state or federal politics.Credit: Louise Kennerley

The opposition raised the matter in a budget estimates hearing on Thursday as part of its campaign to ban developers and real estate agents running for council. The NSW government is preparing to accept and release a long-awaited review of councillor misconduct by the end of the year.

Pesce, who is serving his second stint as mayor, received $5900 from HPA Management Services in the days leading up to the 2016 council election. Company records show its directors are Cronulla real estate agency boss David Highland and, until 2017, his father Peter - who was described as a “successful property developer” in a 2014 magazine article tendered by Labor.

Property developers are prohibited from making political donations in NSW, along with tobacco companies and liquor and gambling entities. Legally, a developer is someone whose business is “mainly concerned with the residential or commercial development of land” and has a relevant application pending, or has had three applications determined in the preceding seven years.

Local Government Minister Wendy Tuckerman initially suggested Labor’s Mark Buttigieg take his concerns to the NSW Electoral Commission but later said she would “absolutely” investigate the donation. Her spokesman confirmed the Office of Local Government would investigate.

Local Government Minister Wendy Tuckerman said the Office of Local Government would investigate the matter.Credit: Flavio Brancaleone / pool

Pesce told the Herald that Peter Highland had retired from property development long before they met, but helped his son start the real estate agency. Highland is named as a “business ambassador” on the agency’s website. He did not return calls.

“I can say with the greatest confidence that I have never accepted donations from a banned donor,” Pesce said. He accused Buttigieg and Labor of embarking on a wild goose chase. “For someone of his intelligence, he should have done a bit more research.”

Buttigieg conceded the article was the only evidence he could produce to suggest Highland was a developer. “Whichever way you slice it, the legislation’s not tight enough,” he said.

Pesce has been touted as a replacement for Morrison in the federal seat of Cook, or for state MP Mark Speakman in Cronulla, if Speakman runs for Cook when Morrison leaves. [Speakman has recently said he intends to nominate again for Cronulla and contest the state election.]

Pesce said Labor raised the old donation as a political tactic ahead of his potential move.

“At this point of time, I’m the mayor,” he said. “I’m not ruling any position out. If things become vacant it’s up to what the branch members want to do.” Buttigieg rejected the assertion: “I didn’t even know he had that ambition.”

Liberal upper house member Shayne Mallard said the attempt to dredge up a donation from six years ago was a smear campaign to try to “tip a bucket on the Liberal Party again”.

Separately, Tuckerman announced a random audit of interest disclosures by councillors and staff, including their properties, shares and directorships or whether they are a property developer or an associate of a property developer.

The “spot checks” will be undertaken by a team of investigators at the Office of Local Government and commence after September 30, Tuckerman said.

She also confirmed that a forthcoming review of the framework around councillor misconduct will examine whether the minister should have the power to suspend councillors while they are under investigation for corrupt conduct.

The review is being conducted by former council manager Gary Kellar, who also sat on an expert panel about similar matters in Queensland. Tuckerman is due to receive the report in October and she committed to releasing it publicly.

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