Huon Valley Council row worsens as Mayor Peter Coad told to step down after ultimatum

A stoush between a Tasmanian mayor and his councillors has deepened with his request they be sacked refused and the government suggesting he step down instead.

The long-running dispute involving Peter Coad, Mayor of the dysfunctional Huon Valley Council — which lists itself as the "southernmost local government area in Australia" — has bubbled along since 2015.

In June, Tasmanian Local Government Minister Peter Gutwein gave councillors six months to participate in mediation to try to resolve constant in-fighting.

In September 2015, the council passed a motion to stop the mayor or any councillors talking publiclyabout an investigation being conducted into their behaviour.

Today, the minister advised Cr Coad to step down after rejecting his request for the entire council to be dismissed.

Mr Gutwein told Parliament he met with Cr Coad yesterday who told him he was withdrawing from the process.

"He made it perfectly clear the only options he supports, that I have the ministerial authority to deliver, is for the entire council to be dismissed," Mr Gutwein said.

"This is unacceptable position for a mayor to take and an unacceptable ultimatum to make."

Instead, Mr Gutwein has advised Cr Coad to step down and allow a new mayor to be elected who can lead the council through the process.

A board of inquiry report on the troubled council recommended its members be sacked as a result of internal conflicts, including a complete breakdown of the relationship between the Mayor and general manager.

But the Minister ignored that recommendation, and decided to give them one more chance to sort out the problems.

Cr Coad was elected in October 2014 under new rules which allowed members of the public to run for the position without already having served time on the council.