Nelson councillor spared prosecution over conflict of interest

Sunday, 10 May 2026

Nelson mayor Nick Smith, left, and councillor Lisa Austin speak on Wednesday about the threat of Austin’s prosecution and dismissal by The Office of the Auditor-General.

A Nelson councillor has been spared prosecution after a conflict of interest was considered by the Office of the Auditor-General.

Councillor Lisa Austin said on Sunday the decision not to prosecute had lifted a great weight from her shoulders.

“It’s been very distressing, and I am pleased it’s been resolved. Thank you to everyone who has supported me. I look forward to getting back around the council table and working for the residents of my community as I was elected to do.”

The Office of the Auditor-General had concerns about Austin and her husband’s business, Austin Transport Tippers Ltd, which supplied trucks for two council contractors on set rates. Their business did not contract directly with the Nelson City Council.

The Local Authorities (Member’s Interests) Act 1968 set rules for the financial interests of elected members with contracts with a local authority amounting to more than $25,000 in a financial year.

The act said such elected members could seek approval for their non-disqualification from the auditor-general. The council had applied for an approval for Austin.

Austin said on May 8 that the chief executive told her the Office of the Auditor-General had declined the council’s application for an approval, and that it was making a decision on whether to prosecute, and that she could be dismissed from the council.

Mayor Nick Smith supported Austin, labelling the law an “ass”, and saying Austin was a victim of a “daft” interpretation.

Lisa Austin was sworn in as a new Nelon City councillor in 2025.

Later in the week, the Office of the Auditor-General wrote to the council saying they had decided not to prosecute or institute proceedings against Austin, as it would not be in the public interest, the Nelson City Council said in a statement on Sunday. The office would be writing to the Minister of Local Government and the Department of Internal Affairs “to once again urge them to consider legislative reform”.

Smith said he welcomed the decision and was pleased it was made so promptly.

“It enables Cr Austin to get on with her job, avoids public money being wasted on daft interpretations of an outdated law and enables the community to be fully represented around the council table,” Smith said.

“This outdated law is difficult to interpret and there are differing legal views on its application. There will be many mayors and councillors across the country, like Cr Austin, who could be caught by this archaic act. I will also be writing to Ministers of Local Government and Regulation urging that this ass of a law be replaced.”

On Monday, the Audit Office confirmed its position, with a spokesman saying the office had weighed whether the circumstances warranted prosecution.

“In the circumstances, we are satisfied that a prosecution would not be in the public interest and confirmed to the Council on Thursday that we will not institute proceedings against Ms Austin.”

It would again write to the Department of Internal Affairs and the Minister of Local Government about shortcomings in the 1968 legislation, the spokesman said.

“We suggested that the Council may wish to do the same and note that the Mayor says he will be writing to Ministers of Local Government and Regulation.”

The office could only issue approvals allowed under the Act, they said.

“As the Act provides, the Auditor-General has no power under the Act to approve contracts between a council and a candidate when the candidate is standing for election. We also cannot approve these contracts after the candidate becomes a councillor. The Act does not allow us to do that.”

Any further steps were up to the council.