Questions and issues arising from Tekau Plus

Somehow Adam missed the 22 March article by Phil Kitchin in The DominionPost on Tekau Plus. Amongst other matters Kitchin noted that concerns had been raised over how some of the money had been spent by those responsible for running the project, viz:-

Specific concerns with the Tekau Plus project:

* $340,000 was paid for a “clustering output” but Tekau provided a “troubling” lack of specific information.

* In one three-month period, Fomana billed Tekau $60,000 for analysing seven media stories, eight economic updates, a business awards list, a 13-page essay and education programme reports.

* For another three-month period, Fomana was paid $33,000 for “analysis and research” that included “developing a strategy for a clear strategy forward”, reading media articles, economic forecasts and working through issues with “stakeholders”.

* $25,000 was paid for a review but Tekau’s justification for the review had nothing to do with evidence asked for or the contracted output.

* $50,000 was paid for a “communications output” but Te Puni Kokiri received no information showing “compliance with that output”.

* Tekau had referred Te Puni Kokiri head Leith Comer to irrelevant documents and e-mails for its output on “niche studies”, for which it received $75,000.

Oh dear, this does seem to raise some issues over oversight, value for money and governance, even if they aresubsequently found by the investigation commissioned to look into them to be unjustified.

He was alerted to it by this interesting blog post by Karl du Fresne, who wrote:-

It’s disappointing, though hardly surprising, that other media haven’t followed up investigative reporter Phil Kitchin’s revelations in The Dominion Post about taxpayer money disappearing into the black hole called Tekau Plus.

The matter raises several interesting questions over governance and why these issues do not get the coverage that might be considered appopriate.

Perhaps other media do not consider these sort of expenditures out of the ordinary by NZ government entities. If so, then clearly the media need to take a long hard look at themselves. No doubt they were more concerned about the huge issue of Phil Heatley’s wine bill.

On doing some research Adam found the following additional articles:-

Again by Kitchin an article identifying some businesses targeteted for funding may not in fact have been eligible

Another Kitchin article noting that the State Service Commission, PWC and Whaimutu Dewes were to do a Value for Money audit

Then he found this one as well by Kitchin:-

The sloppiness of a $3 million contract to help Maori businesses earn export dollars is revealed in documents showing consultants received hundreds of thousands of dollars of taxpayer money – for targets they couldn’t prove they had met.

The debacle over the suspended Tekau Plus project has drawn an admission from Te Puni Kokiri chief executive Leith Comer that the government agency has a “big lesson” to learn.

The project has been frozen and Mr Comer now concedes the contract was extraordinarily loose and wishy washy.

Project bosses repeatedly relied on management cliches about “outputs”, “establishing soft network clusters” and “bigger picture value propositions” when they were pressed for proof that goals were being achieved.

At one stage those running the Tekau project refused to provide details, claiming commercial sensitivity – even though they were spending taxpayer money and the government department that gave it to them wanted to know how it was being used.

These comments just beggar belief.

Then on 22 March The Dominion Post devoted it’s editorial to the issue, making amongst other comments the following:-

The project had the laudable aim of helping 10 Maori businesses to become exporters with foreign exchange earnings of $10 million each within a decade. If it had leveraged off the expertise of successful Maori businesses it might have had a chance of success, but much of the money appears to have been spent on paper shuffling.

Fomana Capital, the company running the project, billed Tekau Plus, the partnership formed to oversee the project, tens of thousands of dollars for reading and analysing media stories, developing a strategy “for a clear strategy forward” and consulting “stakeholders”.

At one point Mr Comer ( CEO of TPK , Ministry of Maori Affairs)  complained in a letter to Tekau Plus chairman John Paki, also the Maori Trustee, that Tekau’s accounts showed Fomana Capital had received $1.2 million of taxpayer money but there were no descriptions of the services it provided, what the money was spent on or what work had been done by Fomana or third parties hired by it.

In another letter, he told Mr Paki 16 times that Tekau had failed to provide documents and evidence required for a six-month period.Tekau is a partnership between the Maori Trustee, the Federation of Maori Authorities (Foma) and the Poutama Trust, a Maori business advisory service. Its principals include some of the most powerful figures in Maoridom – Mr Paki, Foma director Paul Morgan, top of The Listener’s power list for Maoridom last year, and Fomana chief executive, Wayne Mulligan. Mr Morgan and Mr Mulligan both hold 15 per cent stakes in Fomana.

However, the standards of the project fall way short of the accountability and transparency required of organisations dealing with public money.

One might think this issue would be getting more traction. There are significant oversight and governance issues here.

According to The DomPost PM Key has left the door open for more detailed investigation. There are concerns raised by the newspaper that one key player in the saga may have potential conflicts of interest. Most recently the paper reported on a possible over payment of monies for services.

du Fresne concluded his post with this comment:-

To his credit, Comer appears to have blown the whistle on the project (it was frozen last November). But his acknowledgement that the Tekau Plus contract was extraordinarily loose and wishy-washy will have only confirmed fears that Maori agencies operate according to very different rules of accountability, transparency and integrity from other recipients of public money. And politicians, frightened of appearing unsympathetic to Maori aspirations, turn a blind eye to the massive rorting potential created along the way.

Yet again questions of governance arise in respect to the disbursement of funds to these projects and the lack of transparency.

It is especially unfortunate perhaps that these issues arise just when the Key government is considering devolving potentially large sums of money to Maori agencies under the whanau ora umbrella. This issue re Tekau Plus may well raise concerns in some minds as to just how well funds will be controlled and accounted for, particularly when one considers the lack of detail about how the whanau ora concept will operate currently available.

Adam notes a lack of comment from the responsible minister. The usual verbiage about operational issues no doubt.

Yet this project initiated under the ancien regime comes on top of questions over TPK funding of Maori Television’s bid for RWC coverage, proposed grants of NZ$300,000 to celebrate the centenary of the Maori All Blacks and the likely advent of a Maori Party flagship programme in whanau ora. Consequently one might have expected some fronting by the Minister. Perhaps the Minister needs time to consult.

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