The chief executive of Auckland council's events arm has resigned today, in the wake of an audit report heavily critical of his previous role in Hamilton.
As mayor and later chief executive of Hamilton City Council Michael Redman oversaw bringing the ill-fated V8 Supercar event to the city.
The race was initially touted to cost ratepayers about $7 million but by the time the final race concludes next April it will have cost the city almost $39 million.
On Thursday, the Audit office released a report into how the V8 events were handled in Hamilton. It pointed the finger of blame for cost blowouts at council bosses with Redman copping the harshest criticism.
Redman had moved from Hamilton to head the Auckland Council's - tourism and economic development agency - ATEED.
After a day-long meeting of the board today, Redman's resignation was announced via a brief statement which gives no grounds for his leaving.
In the V8 report, auditors revealed council management had been working on the V8s deal for 15 months before councillors were told of it, there was never a business case prepared, and no due diligence carried out on the initial promoters who subsequently went broke owing local businesses and the city millions of dollars.
The audit report reveals there were signs those promoters were in trouble even before the contract with them was signed, and by the time of the first race in 2008 the city had already committed $18m to the event.
It details $3m spending made without council approval and is critical the council lacked a single project reporting mechanism. The councillors responsible for signing the contract never read it, said auditors.
Redman told the Waikato Times on Thursday he had been made a scapegoat for the failed V8 street race.
He said the audit report was riddled with "errors and inaccuracies" and said its authors ignored his contribution.
"The report I was provided with, which cost city ratepayers over $100,000, contains multiple factual errors and incorrect attributions. I reject outright any suggestion management operated without council's knowledge and have provided evidence that that was not the case. The report was initially completed without any input from me, and the authors have largely ignored my detailed and comprehensive feedback," said Redman.
"The ratepayers of Hamilton deserve better. The councillors involved now have to reconcile their knowledge of what happened with these findings. They have a moral obligation to ratepayers to correct the record."
Former mayor Bob Simcock said the report was "shameful" and councillors blaming staff were "gutless".
After its first year, he said the story of the V8 event was simple: "The recession hit, revenues fell, losses built up, the operators went broke, and the new operators couldn't drive sufficient sales to achieve success."
Auditors also criticised councillors' decision in April last year to transfer the rights from the initial promoters to V8 Supercars without knowing the event's costs. "Mr Simcock advised us that he did not consider that information on total costs was necessary for council to make its decision. We disagree. Council should have insisted on manage-ment providing all this information."
But Simcock said many of the auditors' conclusions were wrong, and they had found a scapegoat for blame.
"By placing an unjustified level of blame on staff, and on Michael Redman in particular, the review has achieved council's shameful goal. While I agree with a number of the recommendations the review has made around process, there is nothing in [it] that would have led to a different outcome for the event," he said.
"For more than four years every significant decision relating to the event was supported by the unanimous vote of 13 councillors. At the time, and given the information that was available to council, councillors made reasonable decisions. If with the knowledge of hindsight, the community believes we got it wrong, we all share that responsibility. Councillors who blame their decisions on staff are gutless and unfit for public office."
- © Fairfax NZ News
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