QAO letter reveals secret Gympie council termination payout

An ‘extra’ payment to a senior leader who left the job early and a $17million error were among several problems identified by the state’s audit watchdog in a letter to the Gympie Mayor.

The Queensland Audit Office has flagged several points of concern and potential risks with Gympie Regional Council's financial management, which have been flagged in a letter to Mayor Glen Hartwig.

An extra payout to a former senior staffer on top of their termination entitlements has been flagged by the state’s financial watchdog as one of several points of concern with Gympie council’s financial management.

The revelation was one of several issues outlined by the Queensland Audit Office in its latest review of the council in a letter made public by the council ahead of Wednesday’s meeting.

The watchdog combs through the books of Queensland councils annually ahead of its final financial sustainability report, expected to be released in the coming months.

It found multiple deficiencies within Gympie council’s processes across the 2021-22 financial year, the letter says.

One of these included a financial payment paid to an unidentified senior executive who left the job before their contract ran out.

This payment was “in addition to the normal termination payout” outlined in the executive’s contract.

“The council will need to consider proprietary when such payments are made over and above the contractual obligations,” the letter says.

The Queensland Audit Office said Gympie Regional Council should establish a policy around settlement payments as there was a risk such deals could be “difficult to support … and may impact council’s reputation”.

It recommends the council establish a policy around such payments in the future as there was a “risk … settlements of this nature can be difficult to support in relation to the proprietary of expenditure and may impact council’s reputation”.

“Significant” deficiencies found by the audit included a $17.5m understatement by the council of its land and building assets, and $18.4m of capital works projects finished but not yet put on the council’s asset register.

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The QAO letter says failure to accurately capture these costs risked the council understating its depreciation costs and expenses, and overstating its assets.

Other problems found by the watchdog included inadequate password settings which increased the risk of unauthorised access to the council’s systems, and a lack of formal policies or procedures to manage those system’s access by users.

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An almost year-long vacancy in the job responsible for monitoring the receipt of third party building certificates left the council at risk of losing revenue from developments too, the letter says.

The letter will be tabled for councillors at Wednesday’s general meeting.

The accompanying staff report says the presentation of the letter at the next ordinary meeting after its receipt is required as part of the council’s obligations under the Local Government Regulations 2012.