It will also cast into sharp relief the role of councillors in the management of an appointed CEO, and their obligations under the new Local Government Act.

The Courier has spoken to the Victoria's local government associations, local municipal experts, former and current employees of the City of Ballarat and other regional councils about the way forward for the city's troubled leadership.

They have provided insights into the complexities of managing local government, and the tensions between transparency and 'wanting to get the job done; between competing egos; between long-term employees and those brought in recently; and most pertinently for Ballarat: the need for continual regime change.

Ombudsman Deborah Glass also made clear in the introduction to her report the perceptions of bias had long-term caustic effects on public confidence.

'It was... the perception in Ballarat Council that senior staff, one of them the chief executive, were hiring their friends. Perceptions matter."

THE COURIER'S COVERAGE OF THE MATTER:

Kathryn Arndt is CEO of the Victorian Local Governance Association (VLGA), a body which helps develop policy, advocacy, networking and professional development within local councils and for councillors.

She says the Ombudsman's report has lessons for the local government sector, and highlights the complexities of the business of local government.

"The role of a CEO can be very lonely," Ms Arndt says.

"There will always be resistance to change, and that's the role of a CEO to navigate.

"From the VLGA's perspective, without commenting on the particular details of this report with regard to Ballarat, good local government is defined by good governance, and those processes and procedures are clearly provided in the Local Government Act and the council's own rules and laws.

"Particularly for the CEO, who is responsible for managing hundreds of staff delivering hundreds of services, but also managing a group of elected representatives, the councillors themselves.

Arndt sheets much of the responsibility for governance home to the elected councillors, and those who elect them - the voters.

"The complexity of this needs to be understood at a voter level," Arndt said.

"When people are voting for their councillors, they must be across what the responsibilities of those elected representatives are.

"The implications of the report are no more than what is already in place, but it highlights the very real issues that CEOs and councillors face. It's a reminder of those considerations (of transparency and reporting conflicts of interest.)

Chris Meddows-Taylor is a former mayor of Central Goldfields Shire Council, Honorary Research Fellow at Federation University and chair of the Victorian Goldfields Tourism Executive. He worked in the Department of Premier and Cabinet and is a former human resources senior executive in both private and public sectors.

He says the report is a shot across the bows of Victoria's 79 councils.

"Without a doubt councils will read this with trepidation," Meddows-Taylor says.

."As the report notes, there is a degree to which friendship, networks and so on is a accepted part of recruitment, even a value-added part of recruitment.

"Now the issue will be: if there is past contact, past knowledge of a person, that needs to be very, very clearly stated. That is the key thing to come out of this.

"The reality is networks are important. People work with each other and they gain a knowledge of each other. People realise others have certain skill sets, are a good cultural fit - all of that is good, but the issue this has raised is people are going to have to be rigidly clear in declaring that.

"Local government has been regarded by some as a closed shop. Sure there are appointments from outside, but experience within local government tends to be very favoured. So that will still happen, but there will need to be selection processes that indicate what connections people have, and in some cases people will need to step back from selections, or add others from outside the network to selection panels."

With regard to sourcing and selecting tenders for council work, Meddows-Taylor suggests many council problems can be driven home to flaws in that process.

"There are two absolutely conflicting processes: one is the requirement to be increasingly transparent and even-handed. People will only say that is a good thing, and the report will only add to that ; two, the pressure coming the other way is to get things done, to have fewer staff, to be timely.

"So those tender situations have conflicting processes, and those administering will always have that pressure. And the report will escalate that, but you must be accountable."

With regard to councillors, Meddows-Taylor, like Kathryn Arndt, points out they are precluded by the Local Government Act from undertaking roles and activities specifically delegated to the CEO.

"But the expectation from (state) government and the community," Meddows-Taylor says, "is that elected councillors have the ultimate responsibility for the actions of the CEO.

"Councillors must be able to say to the CEO: 'you need to address this; you need to fix this up; you need to make this a priority.' Councillors cannot roll up their sleeves and get directly involved; that would be an offence under the Act. But they need to be seen visibly managing the situation by providing direction to the CEO."