Corporation bosses defend massive expenses account
Corporation of Hamilton bosses have issued a robust defence of their decision to siphon off $850,000 of taxpayer funds into a ‘Members Expenses' account, arguing that the cash is needed to pay for a number of legal challenges the municipality is fighting.
And at a press conference officials produced financial records for 2012 which showed that the former administration adopted a similar tactic in order to protect assets from Government.
The new Team Hamilton group was elected to run the Corporation in May 2012 and has been under intense scrutiny following a number of controversial decisions.
Yesterday The Royal Gazette revealed that the council had voted to put $850,000 of the municipality's anticipated $21 million revenue for 2013 into an out-of-budget, non-operational members' expense account at the start of the year. So far, the Corporation has spent $479,000 of that fund, with insiders claiming it is being used for “boondoggles”.
At yesterday's press conference, Alderman Carlton Simmons said the former administration, led by Mayor Charles Gosling, had set aside similar monies to pay for potential legal disputes with Government.
Financial accounts for 2012 show the former administration had signed over Corporation properties to a newly-created trust in 2010 to protect them from being seized by Government. The trust was then given $1 million by the Corporation so that it could “retain legal counsel for the potential legal battle with the Government”.
Mr Simmons pointed out that the new administration “is doing nothing systematically different to our predecessors” by setting aside a contingency fund for unforeseen emergencies.
And he suggested that race was the motive behind attacks on the new administration, which he said was more sympathetic to “the little guy” rather than international business.
“We have had to listen to people and some members of the Government maligning us when there's absolutely no basis or evidence to support the criticism,” Alderman Simmons said.
“We have always worked within the law and there is nothing of any sort to suggest that we have done anything illegal or untoward.
“This council hasn't taken $1 million of taxpayer money and put it in a private trust.”
Although Mr Simmons claimed that legal fees had swallowed up a large proportion of the fund, the monies have been spent on other costs, including sending a four-man delegation on a ten-day trip to Colombia to attend a mayors' conference.
Asked for a full breakdown of how the money had been spent, Mayor Graeme Outerbridge yesterday said that he was unable to provide full details immediately, but that information would be forthcoming at a later date.
Last night former Mayor Mr Gosling dismissed suggestions that the two administrations had carried out similar policies with regard to protecting assets.
Mr Gosling said that the trust was tasked specifically to protect the Corporation, and that the $1 million was then handed over to it specifically to fund any legal expenses the trust might incur in any court action against the Government.
That, he said, was in marked contrast to an expenses account that could be dipped into without any apparent accountability.
And he pointed out that, once the trust was dissolved at the request of the new administration, the $1 million was returned to the Corporation's coffers, with additional interest.
“The morning after the election I made an appointment to meet with the Mayor and inform him of the Democracy Trust and the aims of that trust,” Mr Gosling said.
“It was put to the Mayor whether or not he would like the trust to continue and it eventually came about that the Corporation didn't want the trust to continue and so it was wound up.
“The whole point of the trust was that it was set up to protect the interests of the Corporation without any conflict or confusion as to what it or the $1 million was to be used for. And when it was wound down, the $1 million was returned to the Corporation. In fact it received more than $1 million because there was interest on it.
“So to compare the arrangement we set up with the arrangement the current Corporation has is not entirely accurate.”
City of Hamilton bosses have condemned Government plans to overhaul the Island’s two municipalities, claiming that the sweeping changes have been pushed through without consultation.
The Municipalities Amendment Act 2013 was approved by Parliament last week and gives the Home Affairs Minister certain power over Corporation operations while also handing back the “business vote” to ratepayers.
But at yesterday’s press conference, Hamilton Mayor Graeme Outerbridge said that Government had shown “hardly balanced consultation” during the process, adding that the changes will “put problems on the City”.
Alderman Carlton Simmons questioned why the new administration — voted in May 2012 — was constantly being criticised, saying that there was no evidence of anything “illegal or untoward”.
He suggested that the Team Hamilton group had been attacked by Government for supporting “the little guy” rather than international business, and indicated that race may also have influenced detractors.
And he also condemned the decision to give Hamilton business owners — who pay taxes to the Corporation — a vote in municipality elections.
Describing the argument of “no taxation without representation” as “lame”, Mr Simmons said: “This isn’t about protecting a handful of people so that we can get our way, it’s about ensuring that our democracy is in line with other jurisdictions.”
“Why is it that everything we do seems to be illegal — is it because the people who voted for us are not considered smart and therefore we can’t be smart?
“Clearly this Government doesn’t think that the views of the ordinary people matter. These changes are undemocratic and if Government had any respect for the people of North Hamilton, they would have lobbied the people of North Hamilton.”
Mr Simmons described criticism of the current regime by former Mayor Charles Gosling as not professional, while proposals to abolish the post of Deputy Mayor was “the type of interference that was counterproductive to autonomy”.