Corruption watchdog says Perth's lord mayor 'failed in duties' over Olympics trip
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Version 0 of 1. Perth’s lord mayor has been found by Western Australia’s corruption watchdog to have committed several acts of serious misconduct and “signally failed in her duties as lord mayor” for failing to disclose three costly gifts including a US$36,000-a-head trip to the Beijing Olympics. Related: BHP Billiton fined US$25m for gift trips to Beijing Olympics for foreign officials Lisa Scaffidi was one of 60 dignitaries who accepted an invitation by BHP Billiton for an all-expenses-paid trip to the 2008 Games, of which the company was a sponsor. A further 116 people, including WA’s premier, Colin Barnett, were invited but declined. In May this year the company was charged by the US Securities and Exchange Commission with breaching the US Foreign Corrupt Practices Act for sponsoring foreign government officials to attend the event and agreed to pay a US$25m fine. The investigation of BHP Billiton’s conduct prompted the Australian federal police to refer Scaffidi’s involvement to WA’s Corruption and Crime Commission. The CCC began its investigation in April and released a damning report on Monday, just two weeks before the 16 October mayoral election at which Scaffidi will be seeking to win her third straight four-year term. The report found that Scaffidi had been “wrong” to accept the invitation which, even excluding the costs of flights (which are not counted as a gift), was well above the City of Perth council’s $300 cap on gifts where there was a reasonable belief that the donor was “undertaking or intending to undertake an activity that requires council authorisation”. It also found she had committed serious misconduct by failing to declare both the gift and the flights in her 2009 annual return or subsequently, and found that the “decision not to disclose was deliberate”. The prospect of an invitation to the Olympics was mentioned to Scaffidi by Ian Fletcher, then the vice-president of external affairs for BHP Billiton, in February 2008, two days after she presided over a meeting to approve the City of Perth’s new code of conduct for councillors. She ran the idea past the then City of Perth chief executive, Frank Edwards, and the pair decided it was not in breach of the council’s rules because they did not know of any applications by the company before council. But by the time she received the official invitation, on 19 April 2008, council was considering an application by BHP Billiton to sponsor its Olympic Games Live event by letting it use the inner-city square Forrest Place to screen the games. That matter was approved by council on 22 April, with Scaffidi declaring an impartiality interest, and two days later she sent an email accepting the invitation. Scaffidi and her husband spent five days at the Olympics at the expense of BHP Billiton, before flying to Shanghai for a five-day holiday with, among other people, Fletcher. BHP Billiton paid for all the flights. She was interviewed under oath by the CCC as part of its investigation, and, according to its report, “gave no satisfactory explanation” as to why it never occurred to her the trip could fall under the council’s guidelines for a “prohibited gift”. Related: West Australian government agencies spent $1m investigating own staff When asked by the media about why she had not declared the trip, first by the Fairfax journalist Chris Thomson in 2009, and then by other journalists once news broke of BHP Billiton’s drubbing at the US Securities and Exchange Commission, Scaffidi repeatedly said it had been a private trip and therefore did not have to be declared. But in her CCC interview, the report said, Scaffidi was “adamant that the offer was very much ambassadorial because of the extensive interests that [BHP Billiton] have in Western Australia”. “Because of the number of inconsistent explanations that Mrs Scaffidi has proffered, the commission is unable to be satisfied that her motive and purpose for accepting the Olympic package was to advance the interests of the city,” the report said. “It is more probable than not Mrs Scaffidi became aware she should not accept, or alternatively should withdraw from, the trip but chose instead to avail herself of the opportunity of an all-expenses-paid trip to the Olympics followed by a side trip to Shanghai, where she paid for her own accommodation.” Questioning why Scaffidi did not report the gift, despite being reminded to do so by Edwards and others, the report said: “Camouflage could not have concealed the trip. Only non-disclosure might.” The report also said she had committed serious misconduct for accepting and failing to declare another gift of three nights’ accommodation for her and her husband at the Cable Beach Club Resort and Spa for the Broome Cup in August 2008. That trip was was paid for by a company called Hawaiian Investments, which was at that time part of a consortium aiming to develop a “business improvement district” in Perth. A month before the Broome trip an application by the consortium for a $180,000 contribution to the district was put to the council. Scaffidi, who presided over that meeting, did not declare an impartiality interest and voted in favour, and the proposal was carried. The CCC also found serious misconduct in her failure to declare a third trip, again paid for by BHP Billiton, to see Chris Isaak perform at Leeuwin Estate, a winery in Margaret River, in March 2009, for which she received two nights’ accommodation worth $490 and a meal worth $135. But the report said the CCC did not believe Scaffidi’s conduct was corrupt. In a statement released late on Monday, Scaffidi said she was “relieved” the report had been published and she was “truly and deeply apologetic” for failing to comply with reporting obligations. But she said she had been “entitled to rely on guidance offered by people far more serious than me in terms of governance”. She rejected the finding that she had failed in her duty, saying: “I never failed in my duties as lord mayor to the City of Perth in advancing all the capital city’s interests.” “Would I do the same again?” she asked. “The answer is absolutely. It is my work, all in the line of duty. But as a result of the report’s findings I am now acutely aware of the relevant provisions of the Local Government Act and the need to comply with the law.” |