Ipswich ratepayers are paying council staff to answer the phones of other councils in a secretive $10 million-a-year commercial venture that generates millions of dollars in profits for the private lobby group that represents Queensland councillors.
Fairfax Media has established that Ipswich Council has for 10 years been paying the wages of 60 staff and providing office space for Services Queensland, a joint venture between council-owned company Ipswich City Enterprises Investments, the Local Government Association of Queensland and Indian conglomerate Essar Global.
LGAQ financial reports show Ipswich City Enterprises Investments has a 50 per cent interest in the call centre venture. But the same documents indicate that although the LGAQ holds only one-third, it received almost 40 per cent of the $3.6 million profit in 2016 as well as a $470,000 management fee.
???The venture, set up by former mayor Paul Pisasale and then-chief-executive Carl Wulff with the LGAQ's Propel Partnerships business in 2007, has grown steadily in the past five years, generating more than $40 million in revenue and $14 million in profit.
It had income of $9.5 million in 2016, on which it made a profit of $3.6 million.
But the source of the venture's revenue and what happens to the council's share of the profit is shrouded in secrecy, with the council's stake held by a company that publishes no financial information.
The Services Queensland deal is similar to one set up between the LGAQ's Propel Partnerships business and Liverpool City Council in New South Wales, where Carl Wulff took up the post of chief executive after resigning from Ipswich City Council in 2010.
However, unlike the Ipswich arrangement, which has had virtually no public scrutiny, the Propel deal with Liverpool caused a major controversy, prompting councillors to refer it to that state's Independent Commission Against Corruption last year and dissolve the deal.
Ipswich council's website stated the centre "provides a full customer service program to Ipswich City Council and out of hours operations to other government organisations around Australia" but the council declined to provide details of who its customers were or what they paid.
A council spokesman said call centre staff were "council employees and are paid by council".
"On a day-to-day basis their activities are directed by the Services Queensland Operations Manager - a Propel staff member - but for all employment matters they report to the Ipswich City Council branch manager or the Chief Financial Officer, both council employees," he said.
An LGAQ spokesman said staff spent the majority of their time working for the Services Queensland partnership.
"By agreement with Ipswich City Council, a small number of staff have occasionally assisted other councils during major weather-related events," he said.
According to Ipswich council, Ipswich City Enterprises Investments paid a $3 million dividend to the council in 2016, but it declined to provide details of any other dividends.
Unlike other income-producing council-owned companies, Ipswich City Enterprises Investments does not publish financial accounts on the council website. The council has declined to say why.
The company's board includes acting mayor Paul Tully. Mr Pisasale was a director until June of this year, when he resigned all his council-related directorships.
Cr Tully was earlier this month appointed to the policy executive of the LGAQ, which sets direction for the organisation and appoints three members of its board.
The LGAQ said that Cr Tully "is not a board member so there is no actual or perceived conflict of interest" in relation to its dealings with Ipswich council.
LGAQ chief executive Greg Hallam, who has been a vocal defender of Queensland councillors amid a welter of corruption allegations in recent months, is a director of the two LGAQ companies involved in the venture, Prevwood and Local Partnerships Services Pty Ltd.
The LGAQ said Mr Hallam was not paid for these roles and did not receive any performance-related bonuses.
ICAC in NSW declined to comment on the referral of the Liverpool council Propel deal, with a spokeswoman saying the organisation would comment only if the matter became the subject of a public hearing.
