Ministry at odds with Trust

19:17, Mar 20 2014

Education Minister Hekia Parata and the Kohanga Reo National Trust are at odds over events leading to the Serious Fraud Office being asked to step in following claims about a misuse of funds by an arm of the organisation.

Board spokesman Derek Fox said the trust informed Ms Parata on Tuesday that fresh information had come to light which would need to be considered before she released an Ernst & Young report clearing it of misusing public funds.

The Ernst & Young inquiry followed allegations of misspending involving trust subsidiary Te Pataka Ohanga (TPO), including an $800 Trelise Cooper dress, a 21st birthday gift and cash withdrawals on company credit cards.

Parata held a public press conference on Tuesday night to announce that she was satisfied any concerns about public money had been ‘‘well and truly answered’’.

In a humiliating backdown on Wednesday, she said she had asked the SFO to investigate TPO after receiving fresh ‘‘but as yet unsubstantiated’’ allegations  in the previous 12 hours.

Fox said the minister had been informed earlier in the week there were ‘‘potentially some difficulties and maybe it would be better if the announcement they wish to make on Tuesday was postponed till after a meeting that was going to happen in Auckland on Sunday’’.


‘‘They had the allegations before they met the trust on Tuesday night and they never spoke to the trust about it.’’

Parata has been under pressure over her handling of the matter after she first gave an assurance to ‘‘the taxpayers of New Zealand’’ that no public money had been misspent, then conceded none of the allegations around wedding dresses or cash withdrawals had been investigated.

Yesterday, she blamed the trust for the debacle, saying it was up to it to investigate TPO because it was outside her powers to do so. 

Fox said the trust had instigated an independent investigation into TPO by auditors KPMG and the minister was also aware the Department of Internal Affairs was investigating, and had been for some months.

Prime Minister John Key yesterday backed Parata’s handling of the matter and also laid blame on the trust.

‘‘The trust representatives gave her an assurance that they would be following up in relation with the subsidiary which wasn’t actually the subject of the report, and for which the Government doesn’t have oversight. They actually failed from what I can see, in following up on their commitments. There was also other information that came to light and on that basis she referred it to the SFO. That’s exactly the right thing to do.’’

Ms Parata also got backing yesterday from tribal leader Sir Toby Curtis and former Maori Party president Pem Bird, who said it had been ‘‘common knowledge for a number of years now that there have been major concerns circulating throughout the kohanga reo movement and marae that things have not been well internally in terms of finances with the national trust.’’

But Fox said the Ernst & Young report – and the minister’s own statements – had made clear that the trust had not misused any public money.

The affair could threaten the kohanga reo movement’s $92 million a year in funding from the Crown, with Parata saying yesterday the trust needed to ‘‘step up and show they are acting responsibly  so the public can continue to have confidence in them.’’

Fairfax Media