NZ Auditor-General Finds $24 Million Government Contract ‘Unusual and Inconsistent’
The handling of a $24 million contract in New Zealand has been questioned by the Auditor-General, as it was included in the coalition agreement. A charity run by a well-known comedian was awarded the contract, with the Auditor-General deeming the process “unusual and inconsistent.” The contract was decided without a transparent process to assess the service needed, potential providers, and appropriate payment.
Typically, the government would specify the service required, expected outcomes, and then invite tenders for delivery. However, in this case, the contract was awarded to the “I Am Hope” charity without following the standard process. The charity, known for events like “Gumboot Friday,” is led by comedian Mike King, a mental health advocate who has been vocal about sector resources.
Before the last election, NZ First Leader Winston Peters supported King, with a policy commitment of $10 million over three years. This commitment then made it into the Coalition’s first Budget despite significant cuts to health. The Auditor-General highlighted concerns about the process, indicating potential risks associated with the direct contract approach.
In a letter to the Ministry of Health, the Auditor-General outlined concerns, pointing out the challenging situation for officials and the need for transparency and fairness in spending public money. He emphasized the importance of a balanced assessment in procurement processes to ensure value for money.
Officials in a ‘Difficult Position’
While acknowledging the difficult position officials were placed in due to the commitment in the coalition agreement, the Auditor-General stressed the need for public service to ensure transparent and fair spending of public funds. He emphasized the importance of selecting suppliers based on the service needed, providers’ capabilities, and appropriate payment amounts. He intends to monitor the contract’s progress to ensure it is appropriately managed and delivers value for money.
