Why failed council boss got a massive payout
The administrator the Central Coast Council has explained why the former Lismore general manager is still receiving a huge payment despite his part in putting them $115 million in the red.
Dick Persson was brought in to investigate Central Coast Council's massive deficit, after Gary Murphy was stood down in October 2020.
Here is his Administrator's Statement on the CEO's Employment Termination Payment:
"Ratepayers' anger about my decision to agree to a 'full payout' of the former Central Coast Council CEO's contract is totally understandable," he posted on social media.
"I was angry too. I was angry because, as I said in my 30-Day Report, the former CEO did not adequately perform key parts of the role and therefore was a major contributor to the financial decline confronting the Council.
"So why did I agree to it?
"I spent a lot of time challenging the legal advice and working through the contract.
"While I accept responsibility for my decision, I don't believe I had a realistic alternative given the provisions of the contract and the laws governing employee legal rights.
"Having reached the decision, we needed a new CEO to lead the Council through the challenging times ahead.
"Therefore, the most important thing was to remove the former CEO quickly to allow the recruitment of the new CEO to commence.
"Recruiting a new CEO typically takes 3-4 months so getting started became the major priority.
"So why pay 38 weeks salary to someone who I felt had not performed to an acceptable level?
"The contract lays out several options to remove a CEO.
"The option I ultimately agreed to provided the most clear-cut path. No reason needed, but 38 weeks' pay.
"The path to remove a CEO for unsatisfactory performance [still with 13 weeks' pay] would have required me to conduct a performance review and then provide the CEO an opportunity to respond. This process would have taken at least eight weeks.
"Proving the poor performance would have been made difficult by the previous Council having determined his performance as 'meets expectations' in the two previous CEO performance reviews.
"This timetable also assumes Mr Murphy was available to be interviewed.
"On the two occasions I requested a meeting he declined to meet.
"Given all this, I stand by my decision as the best for the long-term future of the Council, its ratepayers and staff. I regret I could not find a better way forward."