TVNZ may lose $200,000 advance

Jane Kiely presented one of Ninox Television's hit series, Mitre 10 Dream Home. Photo / Northern Advocate

Television New Zealand bosses this week announce annual results expected to reflect a tough advertising market and tight finances.

Yet the broadcaster may not try to recover $200,000 of public money caught up in the February 26 receivership and restructuring of a longtime supplier, Ninox Television.

Ninox has been one of New Zealand's most prolific programme-makers and under its producer and managing director David Baldock it made hits like Sensing Murder, Location Location, Location and Mitre 10 Dream Home.

Last year TVNZ commissioned Ninox to make a four-part documentary series Double Lives and allocated $750,000 of taxpayer funds.

TVNZ says it paid $488,000 to make the show - about people who led double lives - in advance because it was made on short notice. According to TVNZ figures, it paid around $280,000 for one episode that it had to rework and on research for three episodes that were never made.

TVNZ says it is comfortable this spending was accounted for.

But TVNZ said that the remaining amount "about $200,000" of public money was among $1,051,300 owed to unsecured creditors.

Ninox went into receivership on February 26 and its name was changed to NTV Limited ( in receivership) under receivers at PKF Corporate Recovery and Insolvency.

Ninox was placed in receivership at the behest of the company's major backer, Gary Hannam.

The PKF receivers' first report said "it appears that the lack of agreement amongst various directors and shareholders on various issues led to a breakdown in the governance of the company."

TVNZ spokeswoman Megan Richards said the broadcaster was making claim with the NTV Receivers PKF Corporate Recovery and Insolvency.

"But the reality is that we will be well down the line of creditors."

"We are also considering whether legal action is open to us, and whether the outcome would justify the expenses involved," she said.

While tiny compared with TVNZ's production budget, the loss of $200,000 of public money was only revealed after queries by the Business Herald.

TVNZ says it handed over the last cash to Ninox in December 2008.

TVNZ is standing by its oversight of public money saying the non-delivery of funded shows was extremely rare.

Megan Richards said the upfront payment for $488,000 was standard practice in the TV industry and explained how the public money came to be caught up in the receivership.

"We were told by the financier of Ninox that the company was going into receivership, but that this was a restructuring matter and a new company would be formed to take over the assets, so our production schedule would not be affected.

"We were given assurances that the production of Double Lives was proceeding according to budget but that delivery would be delayed.

Once the receivership took effect, no further money was paid to Ninox for the programme, she said.

After the receivership Ninox managing director and programme-maker David Baldock also parted company with the firm.

"When the first rough cut of Double Lives was presented a couple of months ago, it was apparent that it was not up to standard," Richards said.

"We asked for certain improvements to be made but the company advised they did not have the money to do this. We are naturally very unhappy with this result," Richards said.

Ninox Television director John McEwen could not be reached for comment.