The new Families Commission boss has called in auditors after discovering $411,000 was paid to an Australian consultant and staff spent up large on gifts and hospitality.
The Crown entity is undergoing restructuring to establish itself as a social policy research institute under the Government's White Paper on Vulnerable Children.
But questions have been raised about how its $8 million budget is being spent.
Acting chief executive Len Cook yesterday told the social services select committee he was concerned by an Australian manager's "prolonged" contract.
In early 2011, Angela Tidmarsh was seconded from the Australian Institute of Family Studies at a cost of $52,235.
Her contract was later extended, and from May 2011 until October last year she was the general manager of knowledge management and relationships on an hourly rate of up to $120.
The commission also spent $39,422 on her travel and accommodation costs.
The total amount paid was $411,732.
Mr Cook said such expenditure was unacceptable in his "traditional public service background".
"While there is no impropriety, in the sense of personal gain . . . it's not something that fits my view of what I would have done," he said.
He was also concerned about the level of expenditure on vouchers given to staff members as birthday presents and overly generous hospitality.
"It's a wee mix of things of that ilk - there's probably six or eight of them - and they're the sort of things that we just stop. Do we subsidise participation in an annual sports event? That sort of thing."
A spokeswoman for Audit New Zealand confirmed the commission had been in touch about having its sensitive expenditures policies reviewed.
Labour MP Rajen Prasad said the spending was irresponsible and showed a lack of board oversight.
"I think it's a scandalous expenditure on one position, no matter how good a person is."
He compared it to the $430,000 of taxpayer money spent on the commission's White Ribbon campaign.
"What were they thinking? I think there is a culture, in this organisation and many others, of just over-using consultants."
Dr Tidmarsh's appointment was made under former commission boss Carl Davidson.
He has since been appointed to the Government's Expert Advisory Group on Information Sharing and was also chairman of the Christchurch Employment Skills Board.
Dr Tidmarsh did not respond to requests for comment.
She left the commission in October last year before the end of her contract, although no termination payment was made.
She is now a manager with the Australian Department of Families, Housing, Community Services and Indigenous Affairs, according to her LinkedIn profile.
The commission's budget has been trimmed by $1 million for this financial year, and the number of commissioners has also been reduced as the focus moves to establishing the Social Policy Evaluation and Research Unit.
- © Fairfax NZ News
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