The Nelson Marlborough District Health Board will look to recover at least half of the $150,000 owed to it by the defunct Te Rapuora Trust.
The board was still chasing repayment through liquidators, who took control of Te Rapuora after it closed on New Year's Eve because of financial problems, the board's Maori health director Harold Wereta said.
That process could result in legal action.
The Maori health provider was overpaid $151,248 by the health board for staff positions that were either not filled in time or were under-resourced.
Audits of the trust's finances and management, carried out in October and November last year by the Nelson Marlborough District Health Board and the Ministry of Health and released under the Official Information Act, showed the Te Rapuora Trust also owed $32,000 to the ministry for not meeting obligations in its funding agreement.
"We are looking at a 50-60 per cent return on our $151,000," Mr Wereta said.
He was speaking at a public meeting held in Blenheim last night.
A previous public meeting in December demanded talks with the Te Rapuora trustees.
Mr Wereta passed that request on to Te Rapuora Trust chairwoman Margaret Bond who declined, he said yesterday.
Te Rapuora services have since been picked up by four other Maori health providers - Te Kahui Hauora O Ngati Koata, Te Hauora O Te Awhina, Maata Waka Ki Te Tau Ihu Trust and Te Hauora O Ngati Rarua.
Nelson-based Ngati Koata started providing Maori mental health services at Witherlea House, at Wairau Hospital, in January.
Director James Reneti said the provider was still building relationships with existing clients and services in Wairau.
Bruce Kereama, who attended the meeting at St John Hall, questioned the location of Ngati Koata in Blenheim. The service would be better placed in town, he said.
Ngati Koata community support worker Karena Martin said the health board planned to audit the provider soon.
This was putting pressure on staff, who did not know what was under review.
Mr Wereta said he would check as to the purpose of the audit.
"I am very mindful that failure could be a possibility if we do not support the services."
Mr Reneti, however, said any audit was justified because it was public money.
Mr Wereta said work to establish a coalition between the seven Maori health providers across the top of the south was ongoing.
Coalition project manager and district health board member Roma Hippolite said work streams were taking place to determine what services were needed and could be provided.
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