Dana Johannsen is the NZ Herald's chief sports reporter

Sport NZ escape government scrutiny over wasted $800K

Sport New Zealand chief executive Peter Miskimmin faced questions from the Auditor General over payments made to an Auckland trust. Photo/PHOTOSPORT
Sport New Zealand chief executive Peter Miskimmin faced questions from the Auditor General over payments made to an Auckland trust. Photo/PHOTOSPORT

Sport NZ has escaped scrutiny from a government select committee over its mishandling of payments to an Auckland developer for a yachting high performance centre.

The payments of more than $800,000 towards the now abandoned Takapuna development, led by the Harbour Access Trust (HAT), drew a series of complaints to the Auditor General in late 2015. The Office of the Auditor General (OAG) found several deficiencies in Sport NZ's dealings with HAT, outlining their concerns in a letter to chief executive Peter Miskimmin in June last year.

However, these findings were not included in the OAG's report to the Government Administration Committee, which met in February to complete its annual review of Sport NZ.

Labour spokesperson for Sport and Recreation Trevor Mallard, said he was surprised the OAG report contained no reference to Sport NZ's involvement in the troubled national sailing centre project.

"It doesn't sound particularly tidy," he said.

"$800,000 is a significant amount of money - that could buy a lot of beginner yachts and a hell of a lot of rugby balls. I would have thought something like this would have been mentioned."

Sport NZ's funding of the controversial yachting facility came under the OAG microscope in November 2015 after Auckland pensioner Colin Flavell asked the watchdog agency to investigate what he believes was "fiscal incompetence" from Sport NZ bosses, who demonstrated an "unsuitability to administer public funds".

His complaint centred around four payments of $115,000 made between March and August 2015, which were made in addition to the $300,000 in "seed money" Sport NZ initially committed. This was at a time when the facility was facing well-organised opposition from community groups desperate to protect the popular Takapuna Holiday Park - the site for which the high performance centre was planned.

The project was finally scuppered in July last year, ending a protracted four-year battle with the community board.

With the Takapuna project having been abandoned and Yachting NZ now scouting locations elsewhere for the centre, Sport NZ's investment to date has been wasted.

Sport NZ paid out $805,000 to HAT, led by Auckland developer Peter Wall, without a sod being turned or resource consent granted. Nor, as the OAG discovered, a funding agreement being put in place with HAT.

Documents obtained by the Herald through the Official Information Act revealed Sport NZ were unable to provide OAG staff with any documentation supporting the additional payments to HAT.

The OAG found Sport NZ's business case to support investment in the centre to be "limited" and criticised the absence of any formal contract with HAT.

"In our view, the lack of a funding agreement and associated reporting to date does not represent good practice," the OAG wrote to Miskimmin in June last year.

Despite these issues being identified, the OAG rated both Sport NZ's management control environment and financial information systems as "very good" and its annual review briefing to the government select committee.

The OAG also suggested follow-up questions the committee may like to ask of Sport NZ, but none of these referenced the messy yachting centre deal.

The OAG's parliamentary group sector manager, Henry Broughton, said in a statement the findings from the investigation into Sport NZ was a separate matter to the annual audit.

"The issue with the Harbour Access Trust was looked at separately by our inquiries team. The annual review process focuses mostly on matters arising from our annual audit work.

"We do not provide a clean bill of health as such, but rather our annual audits provide assurance ... about whether a public entity's financial statements comply with generally accepted accounting practice in New Zealand and fairly reflect its financial position."

Yachting New Zealand are currently completing feasibility study into alternate venues for its high performance centre.

- NZ Herald

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