Boardroom disputes jeopardise Victorian health service

The Registrar of Indigenous Corporations, Selwyn Button has today placed Njernda Aboriginal Corporation under special administration.

Njernda incorporated in 1991 and is located in Echuca, Victoria. It operates a medical centre providing general practice medical services and other health-related services for both Indigenous and non-Indigenous patients. Njernda’s services also extend to family support and family violence programs, placement support for out of home care, foster care and child safety. The corporation derives its income predominantly through grants from both the Commonwealth and Victorian Governments—grants accounted for 88% of total revenue in the 2020 financial year.

Various funding bodies raised concerns with the Registrar about ongoing disputes in the board that were interfering with the corporation’s operations. On 28 October 2021, 5 of the 6 directors wrote to the Registrar requesting the appointment of a special administrator. After reviewing a show cause notice issued to the corporation by the Registrar, the same 5 directors reconfirmed their request for special administration.

‘Members of a board don’t necessarily have to like each other to be effective at decision-making,’ Mr Button said. ‘But when the level of dispute goes beyond healthy debate and deliberations it can be catastrophic for a corporation. It can disrupt operations and cause a loss in client and stakeholder confidence.’

The majority of Njernda’s board recognised their ongoing significant disagreements were making it impossible to efficiently govern the corporation. The breakdown at the top eventually compromised the corporation’s ability to provide an important health service to the community.

‘The special administrators will focus on rebuilding the governance and management teams to ensure a healthy dynamic going forward,’ said Mr Button.

Jack James and Paula Smith have been appointed as the special administrators until 20 May 2022.

MR2122-05
 

Editor's update 20 May 2022: On 20 May 2022 the registrar extended the special administration to 17 June 2022.