What Could Happen if a Councillor Breaches Conflict of Interest Rules?

If a councillor fails to declare a conflict of interest, consequences can include suspension, reputational damage, and loss of public trust.

Mornington Peninsula Mayor Cr Anthony Marsh’s decision to vote on his own Canberra travel at the last scheduled council meeting has triggered questions about conflict of interest rules — and what the consequences could be if the Chief Municipal Inspector Michael Stefanovic finds he failed to properly disclose.

Under Section 154 of the Local Government Act 2020,

“an application for a Councillor Conduct Panel to make a finding of serious misconduct against a Councillor that alleges that the Councillor has failed to disclose a conflict of interest may only be made by the Chief Municipal Inspector.”

This means no other councillor, ratepayer, or authority can initiate a misconduct finding in relation to conflict of interest. The Chief Municipal Inspector alone has that power.

Potential Outcomes

If the Inspector were to make such an application and the panel found a breach, the consequences for a councillor could be significant:

  • Suspension — A Councillor Conduct Panel can suspend a councillor for up to two months. In a similar case in 2022, Mildura Councillor Jason Modica was suspended after the Inspector found he had failed to declare a conflict of interest.
  • Reputational Damage — For a sitting mayor, suspension would raise immediate questions about governance, leadership, and transparency, particularly while continuing to advocate for the shire in state and federal arenas.
  • Impact on Council CohesionMornington Peninsula Shire has already faced scrutiny over budget cuts, governance disputes, and a souring relationship with Frankston City Council. A finding of serious misconduct could deepen divisions and further erode public trust.

Serious Misconduct Threshold

For a councillor to be found guilty of “serious misconduct,” the breach must go beyond poor judgment. The law defines it as failing to disclose a conflict of interest when required — one of the most serious governance failings, because it undermines the principle that councillors act in the public interest rather than their own.

Community Expectations

Local government relies heavily on trust and perception. Even if no suspension occurs, the mere referral to a conduct panel could place additional pressure on both an individual councillor and their council, particularly at a time when councils across Victoria are under increased scrutiny by the Local Government Inspectorate.

What STPL News Asked the Inspectorate

STPL News has contacted the Local Government Inspectorate to clarify whether it has, or intends to, make an application under Section 154 in relation to Mayor Marsh’s vote on his own Canberra travel.

Specifically, we asked whether:

  • An application has already been submitted regarding Mayor Marsh.
  • The Inspectorate intends to consider such an application.
  • The conduct may constitute “serious misconduct” — namely, a failure to disclose a conflict of interest under the Act.
Man discussing general conflict of interest law.
Read: Did the Mayor Fail to Disclose a Conflic of interest

The Inspectorate has been provided with details of the 12 August 2025 council meeting and links to our previous coverage for context.

STPL News is awaiting a response and will continue to monitor developments.

2 Comments

  1. This is the same guy who lead the charge to cancel climate change, the arts, and other good stuff. also led the charge to vote down a motion for public consultation on non resident paid parking that previous council promised and which was presented by a councillor against non resident paid parking. Bases his decisions on pulse surveys not public consultation. And blocks motions he does not like or that do not fall in line with his world view.

  2. Ratepayers deserve honesty and transparency, not self-interest since it’s been found that the Mayor voted on his travel to Canberra. Chief Municipal Inspector Michael Stefanovic, looking at this situation can determine if accountability matters, and if there is a conflict of interest. Until that time, the community waits, with baited breath!

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