Bendigo remains in the dark on hospital CEO sacking

John Mulder has requested a copy of the independent investigator’s report upon which the decision to sack him as CEO was made.
John Mulder has requested a copy of the independent investigator’s report upon which the decision to sack him as CEO was made.

Bendigo Health and the state government have refused to disclose details of findings stemming from an internal hospital investigation which led to the sacking of chief executive officer, John Mulder.

The decision means Bendigo residents – and Mr Mulder – remain in the dark as to exactly which allegations, if any, made by the Independent Broad-based Anti-corruption Commission against the former CEO were substantiated.

Among a number of incidents exposed by IBAC were revelations Mr Mulder used hospital resources in the maintenance of two properties he rented in 2012 and 2013, including one belonging to his wife.

The report on the IBAC investigation, dubbed Operation Liverpool, revealed that while living in a Flora Hill property owned by his wife in 2012 Mr Mulder engaged the hospital’s buildings and infrastructure division to conduct repairs to the property’s floorboards.

The work, which took approximately four to five hours to complete, was done on Bendigo Health time at a cost of between $500 and $600 – as estimated by an employee, who later expressed reservations about whether it was an appropriate use of their time.

The IBAC investigation found Mr Mulder also used hospital resources to conduct, “significant” landscaping and painting work at the Flora Hill property, as well as electrical work at another rental property in Spring Gully.

It also found he arranged for a large glass ambulance depot door belonging to a company contracted to work on the demolition of the old hospital to be transported to a property belonging to Mr Mulder in Torquay at a cost of $1319, which was borne by another hospital contractor.

A director of the company that arranged the door’s transportation at Mr Mulder’s request, told the commission the hospital’s former construction manager, Adam Hardinge, who was also implicated in the report, said “we would sort out the bill down the track”.

“When he said this, I knew that this was meant to be a favour and that I shouldn’t send a bill at all,” the director said.

Mr Mulder denied that he asked, wanted or expected private work to be done by Bendigo Health employees or contractors on Bendigo Health time and that he never intended to pay for it.

But investigators concluded that while he “sometimes used words to the effect of requesting a bill”, Mr Mulder was unable to satisfactorily explain what he meant by his use of qualifying words such as “it doesn't have to be a big bill, but needs to be something”.

“The natural meaning of such language by Mr Mulder, in context, was that he only expected ‘token’ bills for the sake of appearances, and not ones for true value,” the report reads.

IBAC found further allegations made against Mr Mulder involving the rental arrangements of a Flora Hill property and another house belonging to his wife in Harcourt North, through which his rent was paid by Bendigo Health, were unsubstantiated.

The finding came despite concerns investigators held about changes made to the arrangements while IBAC investigators were in Bendigo in June, 2015.

“While it is difficult to accept that the timing of the termination of such arrangements was purely coincidental with IBAC’s inquiries, at the conclusion of the investigation, the corrupt conduct allegations concerning Mr Mulder’s remuneration arrangements were not substantiated to IBAC’s satisfaction,” the report reads.

In a statement released after Mr Mulder was informed of his termination on Thursday, the Bendigo Health board insisted it had afforded him “due process and procedural fairness” but would not be drawn on how it had reached its decision to end his employment.

“We will not be releasing further public information about this matter,” the statement reads.

“Bendigo Health does not publicly release employment files of former employees.”

In backing the decision to fire Mr Mulder, state Health Minister Jill Hennessy also declined to elaborate on what reason or reasons she had been given by the board for its decision.

Ms Hennessy said while the IBAC report uncovered “some really serious issues”, she hinted Mr Mulder’s sacking may be the end of the matter, saying “a lot of the evidence and findings that are made in an IBAC report can’t necessarily be used in other forms of investigations or proceedings”.

“It is true to say that there was an IBAC report that uncovered some really serious issues and while they weren’t the subject of formal findings by the IBAC, Bendigo Health and the board made a decision that they warranted further investigation,” she said.

“They’ve investigated those matters and they’ve made a decision that the services of the CEO ought [to] be terminated and I support their decision.”

On Thursday Mr Mulder reiterated his position that he had done nothing wrong.

“I am very proud of the achievements of my team at Bendigo Health under my leadership, particularly the successful delivery of a world-class new hospital for the Bendigo and Loddon-Mallee communites,” he said. “I firmly believe any judgement from my peers or the people of Bendigo will conclude that I leave Bendigo Health far better placed to meet the health needs of the community than when I commenced as CEO.”

Mr Mulder said he had paid back any money he owed as highlighted in the IBAC report.

“The moment that I became aware that property expenses may not have been allocated to my accommodation account as instructed, I ordered a full investigation that concluded up to $5700 of expenses may not have been allocated to that account,” he said.

“The investigation could not determine this conclusively because there were tens of thousands of dollars worth of expenses that had been allocated to my account and paid accordingly, that could not be itemised. Consequently I asked for an invoice to be prepared for the full amount and paid it accordingly.”