Liverpool inquiry finds no evidence of systemic failures despite minister calling allegations the worst he had seen

The NSW Office of Local Government's public inquiry into Liverpool City Council, which cost taxpayers at least $4 million, examined councillors' conduct as well as the council's handling of finances, property purchases, and more than $150 million in state government grants for infrastructure. The inquiry examined the conduct of Mayor Ned Mannoun, councillors and staff at the south-west Sydney council.

In his 518-page final report, Commissioner Ross Glover said the council "was not entirely free from error, nor is it ever likely to be." He added: "While I am satisfied that there [is] a range of areas in which improvement, and an ongoing commitment to improvement, are warranted, the evidence does not satisfy me that there have been widespread or systemic failures by the governing body or the council in the performance of their statutory functions." Glover also said members of the governing body had "displayed an appropriate understanding of their statutory roles and functions."

The findings are likely to heap pressure on the Minns government and Hoenig, who described allegations against the council, contained in a 2024 interim report which triggered the inquiry, as "the worst I've ever seen." He signalled his intent to suspend councillors and tried to postpone that year's election until the inquiry was completed.

Opposition Local Government spokesman Chris Rath, who used parliamentary powers to compel the government to produce the final report, which Glover handed to Hoenig in September, on Tuesday said the minister "deliberately sat on the report when it didn't recommend administration." "This is a massive blow to the Minns Labor government who have run a nasty campaign for three years to get the council sacked," Rath said. "[Hoenig] should offer an apology to the ratepayers of Liverpool."

Hoenig and Liverpool City Council have been contacted for comment.

Glover said the "overwhelming weight" of evidence at the inquiry clearly indicated the relationship between Mannoun and councillor Peter Ristevski was "fractured and at times hostile" but they were open to mediation, which he recommended should occur. The commissioner noted the council's fiery meetings pointed to "interpersonal divisions" between councillors, often resulting in heated exchanges and strong disagreements, but he did not make any adverse findings against any councillors regarding their meeting conduct.

Glover recommended Hoenig consider issuing the organisation with a performance improvement order and appointing one or more temporary advisers, to allow the council to resolve its governance, performance or financial problems before actions such as suspension. He also recommended the council implement a process to audio-visually record parts of council meetings held in closed session, and arrange training for councillors on conflicts of interest and respectful debate.

Hoenig told a September budget estimates hearing the cost of the inquiry was $4 to $4.5 million. The report that sparked the inquiry was part of a broader investigation into the council's recruitment and staffing processes, which the government said unearthed matters sufficient in seriousness and volume to warrant an urgent hearing. The council launched action against Hoenig in the NSW Land and Environment Court in a bid for the election to go ahead as scheduled, and a judge found the interim report failed to observe procedural fairness but said the government had not unduly influenced the probe, clearing the path for the inquiry to go ahead.