COUNCILLOR Ken Halstead has failed in his bid to bring forward a detailed report on the former Council's Finance Sub-Committee's processes that may have led to the multi-million dollar loss of ratepayer funds.
Despite offering their support to last Wednesday night's motion, councillors rejected it on the grounds that an early release could jeopardise current legal proceedings to reclaim some of the lost money.
Some have tipped a $10 million loss, while others suggest the figure could end up being around the $40 million mark.
Cr Halstead hopes to identify any failings of the former finance sub-committee - made up of councillor Paul Tuddenham, former councillor Malcolm Murray and community representative Alistair McClelland - which oversaw a massive investment in CDOs (Collaterised Debt Obligations) through Grange Securities.
Details of Council's current portfolio, outlined at the same meeting, shows an on-paper loss of more than $20 million through CDOs.
Council is confident of recouping some of the lost money from the now-defunct Lehman Brothers through legal proceedings initiated in the UK, but other CDOs are also looking shaky, such as a $1 million Starts Blue Gum file arranged by HSBC Bank which is currently showing a market value of just $12,000.
Council's corporate services director Barry Paull said the value of investments remained steady.
However, Cr Halstead demanded the mayor come clean about the debacle.
"I would like a statement from you, without any spin, in regards to Council investments," Cr Halstead said.
Cr Gair said the council was not trying to hide anything.
"[Council] will be up front. At this stage there has not been one default, and interest [$500,000 in interest as at October 31] is still being met," he said.
But tensions escalated when Cr Halstead asked for a report into the finance committee's dealings be brought forward, and only Cr Jim Mauger supported the motion.
"The public see it as a hide and seek job... that Council is keeping this [report] from them," Cr Halstead said. "This is serious business - $30 million lost is a lot of money, and I will continue with this issue so the public knows I am on their case."
Cr Gair denied any cover-up.
"Until we physically lose a CDO investment, we have not lost any money. I acknowledge there is an extreme risk on some CDOs," he said.
Cr Tuddenham said he had no problem with doing the report, but there was an issue with the timing.
"The Finance Committee did not invest the money, Grange Securities invested it," he said. "We have been advised not to go public as any information released would see Lehman Brothers subpoena and use it as evidence against us."
"I want it cleared, I want my name cleared, I'm sure the staff do too - but we've been advised not to make this public."
Crs Juliet Arkwright and David Stranger said they supported Cr Halstead's cause but refused to undermine legal proceedings that could recouperate some of the potential losses.
"I campaigned for transparency but feel it unwise to proceed with the motion," Cr Arkwright said. "Cr Halstead, you have my support, but I cannot vote for this motion."
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