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Statement by the Independent Assessor Kathleen Florian – (former) Cairns Regional councillor decision

7 September 2021

Former Cairns Regional councillor John Schilling has been found to have engaged in misconduct during meetings that considered the allocation of council grants, two of which were used to engage his personal business.

The Councillor Conduct Tribunal (CCT) ruled Mr Schilling failed to declare a conflict of interest at a meeting in 2016 and a material personal interest at meeting in 2017, when council considered two separate grant applications which resulted in Schilling Homes Pty Ltd receiving a total of almost $80,000 in ratepayers’ funds.

At the time of the meetings, Mr Schilling was not only a councillor but was also the sole director, secretary, and shareholder of Schilling Homes, which owned a construction business.

The CCT heard the construction business provided quotes to two organisations which applied for council grants, but Mr Schilling failed to declare an interest when the matters were considered even though he was copied into one of the quotes.

In handing down its decision, the CCT pointed out that Mr Schilling was highly aware his building company was active in the area, and the possibility that it had tendered for work was not a remote one.

The CCT said it was foreseeable that a conflict might arise, and Mr Schilling should have taken steps to mitigate that risk.

It found Mr Schilling engaged in “wilful blindness” having failed to undertake very reasonable and straight-forward enquiries, and that he should have taken “more care to exclude himself from council decisions which could have been tainted by his involvement”.

The CCT ordered that Mr Schilling be reprimanded, make an admission of misconduct at a council meeting which is open to the public, and pay Cairns Regional Council a $500 fine as well as $1500 to reimburse the costs arising from his misconduct.

In making the orders the CCT noted that Mr Schilling had “played a part in the approval of the funds to his business”, resulting in a direct financial benefit for his company.

It went on to caution that councillors must be aware of the inherent risk of conflicts should they own or operate a business which obtains or might obtain a benefit from council funding - either directly or indirectly.

The CCT said there was a very real and distinct possibility that Mr Schilling’s “wearing of two hats” would have caused him to have a conflict, given he was a company director seeking to run a profitable business while also being an elected representative with a legal responsibility to ensure transparent and accountable decision-making when spending ratepayers’ money.

The CCT decision can be found here.

ENDS

Media contact: 0477 385 727 or OIAmedia@oia.qld.gov.au.

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Last updated: Tuesday, Sep 7, 2021