Councillors may be held liable for breach of rules

Mayors, local councillors and local council executive secretaries will be held personally liable for knowingly flouting local council regulations from now on, The Times has learnt.

The Local Government Department is finalising a legal notice - to be published by the Home Affairs Ministry soon - which will enable the government to recuperate irregular payments awarded by councils through court action against those who knowingly disregard or flout the financial regulations at the expense of local council funds.

Examples of such flouting of regulations were pointed out by the Auditor General recently and mainly deal with the misuse of public funds, disregard for tendering regulations and excessive expenditure which often places councils in the red.

The director of the Department for Local Government, Natalino Attard, told The Times "punitive measures" against councillors or executive secretaries will be taken "with caution" and in those cases where an irregularity has been "deliberate and without any justifiable reason". Any measures, he insisted he should add, will also follow a procedure whereby the person deemed responsible would be given time to explain.

"These are normal checks and practices in a democracy and are not meant to intrude in the workings of local councils or hamper their autonomy. The aim of the legislation is to make councils more accountable and cost-effective in administering public funds," Mr Attard said.

Besides the legal notice, which follows consultation with the Local Councils' Association, the department is putting through a number of measures to monitor the local councils' administration in the wake of repeated scolding by the Auditor General over the workings of local councils.

In its latest annual report, tabled in Parliament a few days ago, Auditor General Joseph Galea said councils had once again topped the list of entities whose compliance rate with financial regulations "continued to deteriorate".

Mr Attard said he was aware of the concerns highlighted by the Auditor General thanks to an internal monitoring unit which has been beefed up recently and also due to continued liaison with the National Audit Office.

"The department's monitoring unit was manned by one person up till a year ago. Now we have two more officers who are being trained to systematically keep an eye on the councils' modus operandi, including council decisions with respect to expenditure," Mr Attard said.

He said key issues that emerged from the Auditor General's report boiled down to four main factors: accounting mistakes, accounting bad practices, disregard for financial regulations and procedures due to pressures or commitments, and ignorance of the local government legislation by the elected members.

"Another concern to the department is the bulldozer style of certain mayors and councillors. Some insist on pursuing capital projects when they know the council is in the red," Mr Attard said. He attributed this to two main reasons: councillors wanting to keep their electoral promises at all costs and their ignorance of the law.

Mr Attard said the number of local councils ending their year with a deficit had dropped over the years and only seven out of 68 councils ended 2004 with a negative working capital. This was partly due to the constant supervision by the department's monitoring unit.

"There are still problematic councils like that of Zebbug which ended with the highest deficit in 2004, but such cases are the exception and not the rule, and this is quite significant," Mr Attard said.

The Auditor General's report stated that the Zebbug council ended with a negative working capital of Lm199,593. In this case, like all the cases where a deficit was registered, the department will soon meet the mayor, the executive secretary and the council's accountant with a view to establishing a plan on how the council intends to rectify its financial position.

The department will also kick off a senior management development programme for executive secretaries on financial, audit and tendering procedures towards mid-2006 and would target council secretaries who have not had any formal training. This is being done in collaboration with the Association of Local Council Executive Secretaries and with the cooperation of the Local Councils Association.

One problem was that executive secretaries had renewable three-year contracts. "This means they may find themselves in an awkward position if they are in conflict with mayors or councillors on an issue, since they would depend on a council decision to get their contract renewed," Mr Attard said.

After the March elections, the department will offer information seminars to the 159 councillors who would have just been elected, including training seminars in the Maltese language.

An editorial in The Times had pointed out the Auditor's advice to the Department of Local Councils to amend the Local Councils Act, Regulations and Procedures.

Mr Attard said the only pending amendment in this regard was the financial audit procedures, adding this was a technical provision affecting accounting practices used by executive secretaries.

"These are in the pipeline as we have informed the Auditor, even though it would not drastically change the workings of local councils," he said.

Besides setting up a desk to help local councils tap European Union funds, the department is working to address hiccups in the Local Enforcement System (LES). "This is a complex issue where the nine joint committees seemed to feel the need of operating autonomously and without synergy. We are working to achieve uniformity in the application of the whole local enforcement system," Mr Attard said.

He pointed out that a recent legal notice gives an added redress to the citizen in that besides contesting a fine in front of a Commissioner for Justice and appealing that decision within 30 days in the Magistrates' Court, the citizen could now obtain redress through the petitioning system by lodging an appeal by means of a letter addressed to The Registrar, Board of Petitions, c/o 26 Archbishop Street, Valletta CMR 02.