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Update on Waikato DHB expense scandal

We can shed more light on the expense scandal at the Waikato DHB, with the release of documents we requested under the Official Information Act arriving on Friday. Documents were released showing a number of important details for taxpayers (see below).

To our surprise, and despite numerous assurances that the money has been (or was about to be) paid back, the documents reveal that the former DHB CEO, Dr Murray, still owes up to $50,000 in unauthorized spending that’s not been paid back. What makes this particularly disappointing is that Dr Murray was earning $560,000 a year. 

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Waikato DHB ended their investigation partially in exchange for a commitment from Dr Murray to pay back all unauthorized spending. There’s no good reason that debts are still outstanding. 

The documents also reveal a timeline of events related to the DHB’s investigation.

It was pleasing to see that Waikato DHB Chair Bob Simcock visited the State Services Commission the day after he was informed of issues related to Dr Murray. That shows prompt action by Mr Simcock who we’ve been calling to front up more information about the investigation into Dr Murray’s actions. Hundreds of people have even signed a petition calling on Bob Simcock to resign for his failure to hold the CEO to account during his tenure at Waikato DHB.

There are still a number of questions that need answers, however, it appears Waikato DHB were under significant pressure to end their investigation. Since the release of the documents, the Minister of Health, David Clark, has announced an enquiry investigation into the events at Waikato DHB and the expense scandal.

We’ll keep you posted.

New Report: Fare Game? Flagging Down the Cost of Public Servant Taxis

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Our new report, titled Fare Game? Flagging down the cost of public sector taxis, shows that bureaucrats choosing more expensive taxi services over ride-sharing apps like Uber have cost taxpayers at least $9.81 million since Uber’s introduction in mid-2014.

Currently, the 28 tier-one public service departments spend about $9.3 million a year on taxis. That’s compared to just $77k on ride-sharing apps. If all public servants opted for ride-sharing apps over taxis, we calculate the potential savings for taxpayers being around $3.27 million per year.

Despite the recent regulation of the ride-sharing industry, a number of departments still have policies in place banning their staff from using Uber or Zoomy for staff travel. Not only is that not keeping up with the times, it means many more millions are wasted on flash cabs, when a cheaper Uber would do just fine.

The report also assesses the opportunities for increased efficiency in departments who embrace ride-sharing as a means of staff travel. It also shows that internationally, the New Zealand public service is lagging behind.

Gone are the days of paper receipts and employee reimbursement forms. Ride-sharing’s electronic based system facilitates remarkably efficient internal staff travel processes. It’s no wonder federal officials in the United States and Australia have been encouraged to use the new technology.

Key findings:

  • Over the 28 public service departments, $9,334,755.87 was spent on taxis over the period of a year, up until 1 June 2017. This is compared to just $77,102 spent on ride-sharing apps.
  • By applying fare estimates between Wellington Airport and MBIE offices, the report estimates that using Uber over taxis saves around 35%.
  • Applying that figure to government departments, taxpayers could have saved $3.27 million if public servants used ride-sharing over taxis, or $9.8 million since Uber launched in mid-2014.
  • Five government departments have travel policies banning their staff from using ride-sharing for staff travel (Department of Conservation, Ministry of Justice, Crown Law, Ministry for Women, and the Department of Internal Affairs).
  • Only tier one government departments were included in the survey data.  That means that many more millions are likely to have been wasted (and have the potential to be saved) across the wider public sector.

Disclaimer: Neither Uber, or any other ride-sharing interest, have donated, joined, or financially contributed to the Taxpayers’ Union or the publication of this report.  To join the tens of thousands of New Zealanders who have, donate now at www.taxpayers.org.nz/join

 

 

Coalitions purchased with taxpayers’ money

Labour’s coalition agreements with New Zealand First and the Green Party were released on Tuesday. While they set out the policy priorities of the new government, they do not breakdown the costs. Failing to mention the expenses, both in the agreements and most of the media commentary, should be of real concern to taxpayers. 

Headlining the agreements was a new one-billion-dollar “Regional Development (Provincial Growth) Fund”. Despite its infancy, both Labour and NZ First are touting it as a bonanza to their respective supporters. No wonder, ‘Regional development’ is usually code for corporate welfare and pork-barrel politics.

At a cost of $645 per year for the average Kiwi household, more than just political whim will be necessary for any sort of ‘provincial growth’ to result. For every dollar ‘invested’, a dollar is taken from a hard working taxpayer. Disciplined cost-benefit analysis, similar to that done for major roading projects, will need to be legislated to prevent the fund from turning into a slush fund, or make-work scheme.

The risk for taxpayers is the billion being sucked into projects with very low cost-benefit ratios. It could see more government agencies such as Callaghan Innovation, who ‘pick winners’ by giving money to favoured businesses and fashionable industries.

Prime Minister Jacinda Ardern is already indicating the fund will include “a number of regional rail projects” even though KiwiRail is notoriously unprofitable. Treasury have been advising the Government for decades that money spent improving roads offers far more bang for buck than rail. A report released by KiwiRail last year concluded that closing its own freight lines entirely delivered the most long-run value to taxpayers. Ouch. Ms Ardern is picking political popularity of trains, over sound economics.

Some policies don’t even have a budget number attached. 

The Green Party has negotiated for "significantly increasing the Department of Conservation’s funding”. The amount? Unknown. It could double the funding of DOC, be a cunning trick on the Greens, or an invitation to the new Green Party Minister of Conservation to raise revenue, such as taxing tourists entering national parks.

To get to power, Ms Ardern has also promised to expand benefits for SuperGold Card holders. The coalition agreement is light on detail, but if NZ First get what they want, expect the annual costs to shoot up by $300 for the average household. That would buy a free annual GP visit and discounted power bills for everyone aged over 65. 

Clearly, some would benefit from cheaper power and a free doctors’ visit. But offering universally, instead of targeting the support to those who need it most, suggest this was about satisfying a voter constituency than improving living standards.

There are also the ‘studies’ and ‘reviews’ NZ First has negotiated. A ‘feasibility study’ into moving the Ports of Auckland could see billions spent shifting freight services to Whangarei. Another report, again published by KiwiRail, indicated that just the cost of upgrading the rail freight line from Northland would be up to four billion dollars. The cost to the average household would be $2580.

With Mr Peters’ support so expensive, Finance Minister Grant Robertson’s will need to find a way to pay for it all. Labour’s ‘alternative budget’ made no allowance for coalition negotiations, and very little allowance for new spending.

Jacinda Ardern has indicated that Labour’s tax working group will plough ahead. In any case the new Labour-led government will need to find the money to pay for the coalition ‘compromises’ somehow. Taxpayers, brace yourself to have your pockets opened.

False START at IRD

Inland Revenue’s new IT system, implemented in February for their GST services, has been a disappointment. According to official data from IRD, the time spent handling GST related enquiries increased by 50% when the system was first introduced in February earlier this year. As of August, months after implementation, there was still a 20% increase in wait times compared to the previous year.

 


 
The point of investing in a new IT system was to make services more efficient at IRD, but this data shows taxpayers are receiving a worse service after the new system was introduced.
 
Many callers can’t even get to the hold tone. When the system was introduced in February, it faced so much pressure that nearly 2000 callers to the GST line were disconnected without even being put on hold. In the two months prior to implementation, that didn’t happen once.
 
Over 10,000 calls to the GST line were disconnected in May because IRD systems simply couldn’t cope. Inland Revenue either needs to train existing staff more thoroughly, or bring in additional staff during months they know will be busy. How the IRD is proposing to cut 1,500 jobs in this environment is astounding.

See the IRD's OIA response below:

Auckland Council second highest rates in NZ (and they tried to hide it)

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Auckland Council has been caught out providing false information regarding the average rates paid by Auckland households, with revised figures showing that Aucklanders pay the second highest rates in New Zealand.

Over multiple years, officials have provided incorrect information to the Taxpayers’ Union and Auckland Ratepayers’ Alliance researchers under the Local Government Official Information and Meetings Act 1987, presumably as an attempt to avoid criticism of the Council’s very high costs in comparison to the rest of the country.

Post_Man.jpgAs a result of these illegitimate figures, Auckland Council came out much better in our local government league tables than justified. It appears the Council has coordinated responses to deliberately mislead the public on what the average ratepayer pays.

In the initial report, Auckland Council's rates were comparable to New Zealand’s average. Now that the Council has coughed up the true figures, we know Auckland rates are actually the second highest in the country.

Before the Ratepayers’ Report local government league tables were published, we wrote to Auckland Council’s CEO and specifically asked for the rates figure to be checked a third time and were assured it was accurate.
 
With light finally shed on the truth, we have exposed that Aucklanders pay the second highest residential rates in the country.

This new set of data shows that if Auckland Council were as efficient as others in New Zealand, they would be better fiscally prepared to invest in the infrastructure that our city desperately needs.

Ratepayers’ Report was jointly published by the Taxpayers’ Union and the Auckland Ratepayers’ Alliance.

The ‘please explain’ letter sent to Mayor Phil Goff is here:

It's the corporate welfare which is the problem 

An article published last week by Fairfax has left an incorrect impression on the reason why the Taxpayers' Union objects to the Government signing an R&D cooperation agreement with Israel. 

The Union wishes to clarify that it is the nature of the agreement – that Callaghan Innovation's corporate welfare R&D grants will favour companies working with a particular country – not that the agreement is with a particular country.

Our staff just issued a media release where I clarify:

"When asked by the journalist who called, I specifically said that as an organisation the country is irrelevant and tied my comments back to our long-held position against corporate welfare."

"The journalist then asked whether some taxpayers would have an objection to it being Israel, and I agreed but said that personally, and as an organisation, we didn't."

I'm very annoyed that the caption below my picture on the Stuff website suggests that I objected to the agreement because of being "a deal with Israel whose military is in violent conflict with Palestine". Those words are Fairfax's, not mine. Similarly, where the article states: "Williams said many taxpayers would have an issue with New Zealand signing an agreement with a Middle Eastern country whose military continued to engage in violent conflict" - again not my words.

Apology from LGNZ

The Taxpayers’ Union has accepted a settlement and apology from Local Government New Zealand President Dave Cull relating to public statements he made about the accuracy of the Taxpayers’ Union’s local government league tables, ‘Ratepayers Report’, and honesty of the organisation.

While we make no apology for our research being hard hitting and won’t shy from controversy, we take allegations concerning our honesty very seriously and take pride in our research being accurate and reliable.

In this case, Mr Cull’s comments, published by LGNZ, some of its member councils, and the Dominion Post, were demonstrably wrong. He got the basic facts totally wrong.
 
The only material error, which we will be making further comment on later today, was caused by Auckland Council providing incorrect information under the LGOIMA. No one knew of that prior to Mr Cull’s comments, and any dishonesty was at Auckland Council, not at the offices of the Taxpayers’ Union.
 
We have accepted Mr Cull’s apology and modest financial payment as full and final settlement of this matter.
 
As part of the agreed settlement Mr Cull has provided the following statement: 

On 23 August I wrote an opinion piece regarding my concerns about the quality and utility of Taxpayers' Union 2017 Ratepayer's Report.
 
The Taxpayers' Union has objected to two sentences in the piece, which referred critically to some ratepayer analysis work conducted in 2014. I said: "The organisation got its first attempt at this data fundamentally incorrect in 2014. There were so many errors the material was withdrawn".
 
The Taxpayers' Union has now told me that its 2014 work was taken down because it was out of date, not for any other reason. It has also pointed out that LGNZ's critical review of ratepayer analysis in 2014 related to work done early in 2014 by an independent person, rather than the later Taxpayers' Union’s 2014 Report.
 
As a result, I have asked the Dominion Post to delete from the opinion piece the references to work undertaken in 2014. LGNZ apologises to the Taxpayers' Union for any confusion.
The Taxpayers’ Union expects to make no further comment on this matter.

Should Bob Simcock resign?

download-7.jpgToday's Waikato Times covers our call for Waikato DHB Chair, Bob Simcock, to follow his disgraced Cheif Executive, Nigel Murray, and resign for the lack of oversight and expense scandal, we've been bombarded with feedback from our members and supports in the Waikato region on the issue.

images-13.jpgWe've been looking into this story for some months, and the DHB had, in fact, refused to give us details of the expense claims on the basis that it was subject of an employment investigation.  Now that Mr Murray has resigned, we'll be contacting the DHB on Monday to get details of those expenses.  A resignation is no reason to keep something secret, even if we never know of the (now moot) outcomes of the investigation.

David Farrar has blogged on the issue here:

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So the full story is the DHB hired [CEO, Nigel Murray] despite warnings, his former hospital was poorly run, he didn’t show up at conferences he had been paid to attend overseas, he didn’t disclose his expenses, then finally they turned out to be $108,000 and the local GPs say they can’t work with him.
So how did this carry on for three years? There needs to be accountability from the DHB.

David nails it here.  Given that Mr Simcock was warned about Mr Murray, before he was appointed, how and why on earth wasn't there control systems in place to ensure that this couldn't happen?  It is usually the Chair who signs off on a CEO's expenses, so why hadn't the expenses being public disclosed for years, as is normal in such senior positions across the public sector.

UPDATE: A number of our members and supporters in the Waikato have contacted us today asking us to launch a petition, calling for some accountability and for Mr Simcock to resign.

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Click here to add your voice calling for accountability via the petition.

How much will this election cost you?

We've had a great response to our full-page newspaper ads which ran across the country yesterday.

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The figures are based on our election policy costing "Bribe-O-Meter" which is based on the parties’ own estimated costs of their policies and they have been tracked and verified by our own independent economists. The total figures per household assume that each party spends what it has promised, and does not take into account possible changes arising from negotiations to form a government.  As you can see, the NZ Frist figure, when paired with Labour is lower than the National and New Zealand First total because, in some cases, Labour is also promising to spend the same amounts in the same areas as New Zealand First.

We've just started our online advertising campaign (Ad-roll YouTube, Stuff.co.nz and Facebook ads) to help spread the message.  If you agree that taxpayer rights are important to be protected at this election, chip-in to our online advertising fund at www.taxpayers.org.nz/bribe_o_meter_donate.

Thanks to the thousands of supporters who have chiped-in to make this work possible.  To help spread the word, click here.

Barrie Saunders appointed to Taxpayers' Union Board

Barrie_Saunders_(thumbnail).jpgWell known former Wellington lobbyist and former journalist, Barrie Saunders, has been appointed to the board of the New Zealand Taxpayers’ Union.

Barrie retired from the government relations consultancy, Saunders Unsworth, in March 2015, after 25 years as a government relations consultant.  The company specialises in the management of public policy issues on behalf of its clients, which are predominantly business organisations and corporates.  

As a government relations consultant, he worked for corporates, groups of corporates and industry organisations including: fishing, used vehicle imports, pharmaceutical advertising, meat, pipfruit, timber, institutes of technology and polytechnic and the New Zealand Business Roundtable, a free market think tank.  Barrie was the executive chairman of the 14 member Port CEO Group, a virtual organisation from 2002 to 2015.   

He was President of the Wellington Regional Chamber of Commerce  2000-2002 inclusive, is now a life member of the Chamber.  Chairman of CBL, the Chambers investment company 2003/9.  He was a trustee of the Wellington City Mission 1999/2006 and a member of the Housing NZ Board 1994-97.  In 2011 he was appointed a director of TVNZ and completed his second term on April 2017. 

Prior to establishing his government relations business in 1990, Barrie worked as a journalist (radio and TV in New Zealand, Australia and the UK), and the National Business Review, of which was the founding editor in 1970.  He later worked in public relations.  He was press secretary to the Labour Party Leader Bill Rowling (1976-79), Public Relations Manager for the Manufacturers Federation (1979-83) and Public Relations Manager for the NZ Meat Producers Board 1983-86.  He was the Board’s North American Director based in New York from 1986 to the end of 1989.    

A print quality, royalty-free, photo of Barrie is available here


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