Act leader David Seymour has questioned a $45,000 Provincial Growth Fund grant to a company whose use of taxpayer funding has in the past been the subject of scrutiny.
Fomana Capital Ltd, run by Port Nicholson Block Settlement Trust chairman Wayne Mulligan and former Federation of Māori Authorities chief executive Paul Morgan, received the grant in January for timber waste management in the Manawatū-Whanganui region.
Fomana was in charge of the $3 million Tekau Plus Māori business development project, when Te Puni Kōkiri suspended funding in early 2010 over questions about what had been achieved and perceived conflicts of interest by the project.
Tekau Plus was a partnership between the Government-appointed Māori Trustee, Fomana and the Poutama Trust which aimed to develop clusters of Māori businesses that would earn $10m in foreign exchange within 10 years.
A review found there should be better accountability by TPK, inappropriate and inadequate governance over the project, unproven results and a conflict of interest.
Fomana was formerly the investment arm of the Federation of Māori Authorities, which sold its 70 per cent share to Morgan and Mulligan in 2010.
Mulligan told the Herald Fomana had received the PGF funding for a project in the Manawatū-Whanganui region which sought to bring technology from Taiwan to New Zealand that would turn wood waste into bio-plastics for packaging.
The company was working with businesses and local government on the project, he said.
Seymour said it was concerning that New Zealanders were being forced to give money to Fomana, which he claimed had "mismanaged taxpayer funds in the recent past".
"Shane Jones promised he would be a responsible steward of taxpayer money but he's taken a spray and walk away approach to spending. The Provincial Growth Fund should be wound up and the money given back to taxpayers because they make wiser investment decisions with their money than politicians and bureaucrats," Seymour said.
Mulligan said Fomana had received other taxpayer funding since 2010's events.
"We go through every process that is required, and in this particular project we had to meet with MBIE, the Provincial Development Fund."
Of the Tekau Plus project he said: "We delivered everything and more, and for whatever reason there was that approach. So be it, that's part of life."
Mulligan said Seymour was entitled to his view.
"At the end of the day we work with transparency, we show everything, we deliver on everything. I'm not sure what else we can do."
PGF investment director David van der Zouwe said the application from Fomana Capital was subject to the usual assessment process and due diligence check.
It met the criteria of the Provincial Growth Fund as the project had the potential to increase investment in Manawatū-Whanganui region, create jobs and help develop sustainable forestry practices in the region, he said in a statement.
Payments were tied to meeting contractual milestones and Fomana Capital was required to present a completed report before final payment was made.
"The applicant met all the milestones as stipulated in the contract," van der Zouwe said.
Jones said he had not received or read the final report from Fomana.
"I would be concerned if these reports don't lead us anywhere.
"Providing projects go through a robust process that passes muster in terms of what the Auditor-General might expect of our functioning then I don't really want to judge people on the basis of historic lapses," Jones said.
Jones oversees PGF funding of over $1 million while officials make decisions on everything else.
The Provincial Development Fund apologised to Jones last year after $350,000 of PGF money was approved for a West Coast waste-to-energy project with connections to a businessman who had been referred to the Serious Fraud Office.