The Blue Mountains council will be scrutinised after the state government announced a public inquiry into the council's alleged mishandling of an asbestos crisis.
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NSW Local Government Minister Gabrielle Upton said on Wednesday the independent inquiry would examine serious allegations linked to asbestos mismanagement and organisational governance.
Blue Mountains City Council faced an unfolding asbestos crisis after an independent probe found it had instructed its workers to dig up, transport, and sift through soil it knew was contaminated.
Ms Upton said the public inquiry would examine the council and the councillors' response to asbestos problems since 2012, including funding and co-operation with state government agencies.
It would also examine the council's employment processes for staff and contractors, including those engaged to independently investigate asbestos management and employment matters.
Barrister Richard Beasley, SC, has been appointed commissioner to conduct the inquiry.
The hearing is a response to conflict of interest claims that emerged after the council ordered an investigation into its handling of asbestos problems last November.
Those allegations centred on a claim first aired by 2GB radio host Ray Hadley that an independent investigator for the inquiry, Michael Tooma, had failed to disclose a friendship with former council staff member Mark Mulligan.
Mr Tooma has strongly denied the allegations. He said Mr Mulligan’s employment by the council began one week before the investigation began, placing him outside the scope of the inquiry.
The council launched injunction proceedings against a move by Ms Upton to suspend the council over the claims, triggering a lengthy court battle.
Ms Upton said on Wednesday councillors would remain in place during the inquiry.
She said in a statement the hearing would "get to the bottom of these matters once and for all in an open and transparent way" and help restore residents' faith in the council.
“Anyone with concerns about the council can now raise them with the commissioner of the public inquiry and the matters will be appropriately aired and tested.”
Mayor Mark Greenhill said there had been no adverse findings against the council from the initial investigation and it would co-operate with the public inquiry in a "full and open manner".
“We have continued to demonstrate our absolute commitment to working with the NSW government and regulators in response to any relevant requests, and will continue to do so," he said.
The commissioner will present a report to the minister at the end of the inquiry.
