Heatley Phil: Questions for Oral Answer — Questions to Ministers Questions to Members 
Heatley Phil: Questions for Oral Answer — Questions to Ministers Questions to Members 
[Volume:606;Page:3641] 
8.  
PHIL HEATLEY (NZ National—Whangarei) 
 to the  
Minister of Social Services and Employment 
: Following Police confirmation that Te Hau Ora O Te Tai Tokerau Trust did invest $100000 of taxpayer and Department of Child Youth and Family Services money in a fraudulent investment scheme did purchase $20000 worth of gym equipment from a key executive’s son and did spend nearly $25000 on an unapproved overseas trip what accountability will the department be seeking from the Trust and will it recover any money from the Trust? 
Hon STEVE MAHAREY (Minister of Social Services and Employment) 
: 
 In terms of seeking accountability the Department of Child Youth and Family Services has withdrawn contracts commenced legal proceedings to freeze and recover public money and requested a police investigation into possible criminal conduct and given that the trust is now in liquidation it is pursuing fund recovery through that process. Of course how much money is available will depend on the liquidator. 
Phil Heatley 
: Given that Plunket first warned the Department of Child Youth and Family Services in writing 2½ years ago staff warned it 1½ years ago—again in writing—and the department eventually gave Te Hau Ora O Te Tai Tokerau Trust a 60-day ultimatum why did it still take the Minister another 6 months to act which gave the trust even more time to spend up large on barbells bench presses overseas trips and shocking investments? 
Hon STEVE MAHAREY 
: As I have said in the House and to this member before I think the department behaved appropriately in this matter. When the matter was brought to its attention by Plunket it began monitoring the organisation. In 2001 when the department was written to about the organisation it began the process of working through with the organisation which resulted in the withdrawal of its funding. The member will also know that about 3 weeks before we proceeded with criminal proceedings I said in the House that I thought the Department of Child Youth and Family Services had done its job as it should; it had taken about 2 or 3 weeks too long and that is why I told it to go to court and freeze the assets. 
Darren Hughes 
: For what reasons do Government departments like the Department of Child Youth and Family Services contract with community agencies? 
Hon STEVE MAHAREY 
: Government departments contract with a wide range of community agencies to deliver community social and other services. Many groups of course offer excellent and innovative services run by local people for local people. The vast majority of them do exactly what their contract requires of them. It would be an unfortunate day if the actions of a few individuals in one organisation such as this were to tarnish the reputations of the many thousands of people who run successful services across the country. 
Hon Brian Donnelly 
: Will the Minister concede that this Te Hauora o te Tai Tokerau case demonstrates appalling contracting processes including monitoring within his ministry and will he guarantee to this House that the steps he has taken to make these processes more robust will ensure that no more such scandalous examples of wastage of taxpayers’ money will occur? 
Hon STEVE MAHAREY 
: No I would not concede that this indicates that our contracting across the board is a problem. In fact the Department of Child Youth and Family Services contracts with something over 1000 organisations; this organisation is just one which we have heard about. But I repeat to that member whom I want to thank for the way he has approached this issue—supporting people in his community to get the services up and running again—that what we do not want to see is this one case involving in particular one individual being allowed to taint other community groups or the success of this approach. 
Dr Muriel Newman 
: Does the Minister believe the trustees’ spending was properly authorised and accountable; if not could he advise the House whether he has asked or intends to ask the Attorney-General to do her duty as guardian of charitable trusts and take action against the defaulting trustees? 
Hon STEVE MAHAREY 
: Working back through the question I first say that of course the trustees are now in voluntary liquidation. The person she is referring to in relation to the misappropriation or the misuse of funds has lost her job and therefore has been fully accountable for what has occurred. 
Dr Muriel Newman 
: I raise a point of order Mr Speaker. The question was whether he had asked the Attorney-General. I would like the member to answer that question. 
Mr SPEAKER 
: I thought the Minister said no to that. 
Hon STEVE MAHAREY 
: No. 
Judy Turner 
: What investment guidelines does his department give to recipients of funds who need to manage the use of that money over a length of time and where short-term investment may be considered an option? 
Hon STEVE MAHAREY 
: I am sorry but as I understood the question it was what assistance is given to organisations in terms of— 
Judy Turner 
: What guidelines do you give? 
Hon STEVE MAHAREY 
: Treasury has issued guidelines for all community groups in relation to the use of their money and one of the things it makes very clear is that groups should not be investing that money in a short-term way looking for interest. That money is there for them to invest in the services they provide. 
Phil Heatley 
: Will the Minister support the Controller and Auditor-General’s proposal to me—because I have written to him—and to this Parliament to have a wide-ranging study of contracting practices right across the State sector in the light of what we can learn from the Minister’s Te Hauora o te Tai Tokerau fiasco? 
Hon STEVE MAHAREY 
: No because we do this as a Government ourselves. We are absolutely committed to the principle of delivering services through local people unlike it seems the National Party and because we are doing that we are very vigilant in relation to the way contracting is done. 
Phil Heatley 
: I seek leave to table a statement in this House made by the Hon Ruth Dyson last year admitting that Plunket and staff had written to the Department of Child Youth and Family Services years ago. 
Document not tabled. 
Phil Heatley 
: I seek leave to table a 6-page police report confirming Te Hauora o te Tai Tokerau’s slightly uncurbed spending habits. 
Document by leave laid on the Table of the House. 
Phil Heatley 
: Finally I seek leave to table a recent letter to me from the Controller and Auditor-General proposing a wide-ranging study. 
Document by leave laid on the Table of the House.