The Department of Local Government did not take over the City of Nedlands in March 2024. It said officers were working with the City to determine how the department could support the council after auditors disclaimed the City’s 2022–23 financial report. The immediate dispute was how to appoint an independent consultant to address audit problems while complying with procurement rules.
Why the Department became involved in 2024
On 28 March 2024, PerthNow reported that the City’s 2022–23 financial report had received a disclaimer of opinion because it was submitted without complete and accurate underlying records. A disclaimer is a serious audit outcome: the auditor could not obtain sufficient appropriate evidence to give an opinion on the report. It does not, by itself, establish fraud or quantify the City’s financial position.
The City was also divided over how to hire an independent consultant to help address the audit problems. City officers warned that bypassing procurement procedures could conflict with the Local Government Act, while the department emphasized that Western Australian councils must follow procurement rules. PerthNow reported that Craig Ross had been selected for a three-month assignment at a fee of $42,000, but the account describes a disputed appointment, not a verified completed remediation.
The department’s role was described as support under consideration, not formal administration or an investigation. A DLGSC spokesperson told PerthNow: “Local government officers at the DLGSC are working closely with the City of Nedlands to determine how the department can support and assist the council in resolving the issues that were identified by financial auditors.”
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How the situation changed after the 2024 audit dispute
Commissioners replaced the council in 2025
On 24 July 2025, the Western Australian Government announced the appointment of commissioners David Caddy, Bianca Sandri and Cath Hart. Five councillors had resigned, and the remaining four positions were declared vacant. The commissioners were to carry out council responsibilities until a special election on 28 March 2026. Their stated immediate priorities included adopting the 2025–26 budget and addressing issues raised by the Auditor General’s disclaimer on the 2022–23 audit.
An audit improvement did not end reporting problems
The Office of the Auditor General’s 2025 audit-results report says the City’s 2024 audit, issued in 2025, removed the prior disclaimer. However, comparability was qualified because the prior-year figures could not be audited. Separately, PerthNow reported in September 2025 that commissioners voted to ask the Department of Local Government, Industry Regulation and Safety for an extension to submit the 2024–25 financial report, from 30 September to 15 November 2025. A staff report cited resourcing constraints and the late completion of the 2023–24 audit.
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What the City reported about its finances and assets in February 2026
The commissioners’ 5 February 2026 agenda estimated a $2.85 million deficit for 2025–26, compared with an approved budget surplus of $1.38 million. The agenda warned that systemic and historic deficiencies in financial systems meant the City could not have full confidence that the estimate reflected its true position. The estimate should therefore be read as a warning signal, not as a final or reliable measure of the year-end result.
The agenda also described constraints beyond the annual budget:
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- Cash and financial planning: the City lacked adequate cash-flow forecasting and an up-to-date long-term financial plan, rating and financing strategy, or asset management plan. City advice was that planned and budgeted creditor obligations could be met if rates arrived on time, leaving limited capacity for unexpected spending.
- Systems and oversight: the agenda identified transaction and budget errors, weak long-term oversight and system controls, audit issues, and the loss of key staff and corporate knowledge.
- Infrastructure: the City described a $502.8 million infrastructure asset portfolio and infrastructure that was rundown, and in some cases unsafe, after prolonged underinvestment. It estimated more than $27 million to address outstanding and emerging catastrophic risks.
- Renewal needs: the agenda put the asset maintenance and renewal backlog at $24.18 million and estimated approximately $41.8 million would be needed over the coming decade for unfunded asset renewal. Current annual capital investment in infrastructure renewal was approximately $4.3 million; the agenda said the backlog would require additional annual capital spending beyond the existing program.
These are estimates and descriptions from the City’s 5 February 2026 agenda, not evidence that the funds were secured or the work completed. The agenda also identified poor integration between asset management and finance as part of the broader problem.
What commissioners sent to state oversight officials
The commissioners’ minutes record that they unanimously provided their report to the Minister for Local Government, the Local Government Inspector and the Department’s Director General. The minutes also noted the closure of four playgrounds over safety concerns. Commissioners asked the CEO to prepare a report for the incoming council to consider a remediation action plan. That is a request to develop a proposal; the minutes do not establish that the new council adopted or completed a plan.
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Who governs Nedlands now, and what remains unknown
The special election took place on 28 March 2026, and the Western Australian Electoral Commission lists Leonie Browner as elected Mayor. City listings show Audit, Risk and Improvement Committee meetings continuing through September 2026. These records establish a return to elected governance and ongoing oversight meetings, but they do not establish that financial remediation is complete. The sources cited here do not establish the final audited 2025–26 result or the new council’s progress on remediation.
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Sources
- PerthNow, 28 March 2024: department support, audit disclaimer and consultant dispute
- Western Australian Government, 24 July 2025: commissioner appointments
- PerthNow, 25 September 2025: request for more time to submit the 2024–25 report
- Office of the Auditor General, 2025 audit-results report for local government entities
- City of Nedlands, commissioners’ agenda and minutes, 5 February 2026
- Western Australian Electoral Commission, City of Nedlands special election
- City of Nedlands, council and committee meeting listings
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