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Council out of its depth

Last updated 05:00 05/12/2013

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A damning report into Mangawhai's wastewater scheme $63.3 million budget blowout has come from Auditor-General Lyn Provost.

The EcoCare wastewater project left the Kaipara District Council in financial strife and led to one of the largest investigations by the auditor-general.

In a decision released on Tuesday, Mrs Provost found the council was out of its depth when managing the wastewater project.

The report highlighted serious failings by the council, including not meeting fundamental legal and accountability obligations.

Audit NZ also came under fire in the 420-page report, presented by Mrs Provost to about 200 people at the Mangawhai Club Tuesday afternoon.

"It is clear that some of the audit work has fallen disappointingly short of the standards we and others expect. For this, I apologise unreservedly," she says.

A lack of financial expertise, significant weaknesses in project management, gaps in record keeping and a heavy reliance on private partnerships led to costs reaching more than $63m.

The report is particularly critical of KDC's financial arrangements. The council, which is now being run by Wellington-appointed commissioners, raised rates on Mangawhai residents to meet the interest costs of the spiralling debt.

Mrs Provost says the botchups severely damaged the relationship between the community and council.

The inquiry cannot undo the results of years of poor decision-making, but she says she hopes other councils learn from the Kaipara council's mistakes.

Mangawhai Residents and Ratepayers Association chairman Bruce Rogan says the report just confirmed everything they already knew. But it also vindicated their position.

Mr Rogan says it is interesting now that people are suddenly saying some of the matters need to be determined at court.

"Given how much money and time they have spent trying to stop us going to the high court."

Northland MP Mike Sabin has asked the Office of the Auditor General to sort the cost out with the Kaipara District Council.

"It's now imperative for myself, the commissioners and others to work carefully through this report as part of the next body of work, and ensure that those, who alongside the auditor failed the ratepayers, are called to account," Mr Sabin says.

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