Mairehau criticised over $100,000 school hall

Mairehau School* has been criticised for "a lack of prudence" in the funding of a $100,000 school hall.

However, the school said it was simply attempting to build a hall that the wider community could use.

The finances of some school boards has been brought into question in a report just released on spending in 2011.

The auditor-general's report on the education sector, based on audits carried out last year, shows some schools in serious financial difficulty and 200 with a working capital deficit.

Others have been criticised for spending taxpayers' money on traffic fines, satellite TV subscriptions and contracting companies owned by their trustees.

Eight audits, including Mairehau School's, were highlighted due to concerns with integrity, poor judgment, or waste in school spending.

Mairehau contributed $100,000 to a trust to build a hall, but did not have formal agreement of the trust or the Education Ministry.

Auditor-General Lyn Provost's report said this spending showed "a lack of prudence on the part of the board".

''We understand that the board has now requested that the trust repay the money.''

''In our view, this spending showed a lack of prudence on the part of the board,'' the report said. ''We understand that the board has now requested that the trust repay the money.''

Mairehau principal John Bangma said the school had set aside the $100,000 from the 2004 meger with Birch Grove school to build a bigger school hall that would also be available to the community.

''Perhaps we acted in a bit of ignorance,'' said Bangma.

''You cannot use education money for anything that is outside of education. Building a hall for our youth does not qualify.

The trust has repaid the money in full, which is sitting ''gaining interest'' in the school's account, Bangma said. It will still be used to build a larger hall when the timing is right, he said.

''The existing hall is too small and for Mariehau, we need a larger community facility that everybody can benefit from.''

The report also noted  Spreydon school, Te Kura Kaupapa Māori o te Whanau Tahi, had ''limited controls over income'' in the 2010 and 2011 audits.

Board of trustees chairman Huata Martindale said the board had identified some past financial procedures that could have been ''done better'' but were now fixed.

Provost said auditors had wanted to carry out a special audit project, analysing the last few years' information for all schools, ''given the public interest in the financial health of schools''.

Auditors would analyse the 2012 financial information for release in 2013.

Provost said there would be more consistency in the reporting of serious financial difficulties allowing a more comprehensive summary next year.

This year's summary of New Zealand's 2250 schools found a range of operating expenditure from $200,000 to $20 million.  Provost said most schools were financially sound.

However, the 2011 audits found a number of breaches of the Education Act:

• 33 schools borrowed more than they were legally permitted to

• 16 gave loans to staff

• 10 had conflicts of interest

• six invested school money in organisations that had not been approved

• five paid one or more of their teachers directly

• 15 breaches were for other reasons

Tauranga's Te Kura Kaupapa Maori o te Kura Kokiri spent money on an overseas trip to the Cook Islands, shipping clothing and household items overseas and for tyres and repairs on vehicles not owned by the school.

Palmerston North's College Street Normal School contracted a company owned by one of its trustees to carry out $87,000 worth of building and repair work, without the Education Ministry's approval.

Timaru Boys' High School invested $170,000 in organisations other than approved banks.

Rotorua Boy's High School and Northland College were viewed to be in serious financial difficulty, with the latter borrowing $274,000 more than it was permitted and acquiring $436,000 in company shares without approval.

* The original version of this story named Mairehau High as the school in question. However it was Mairehau Primary. The Press apologises for this error and regrets any confusion caused.