Hip hop bait for recruiting says Act MP

Te Wananga o Aotearoa funded a school hip hop trip in exchange for the students recruiting people to enrol at the wananga - a deal worth up to $348,000 in Government funding for the tertiary institute.

The wananga gave Gisborne's Lytton High School $3500 last December to send five students and a teacher to compete in a dance competition in Christchurch.

But to get the money the students each had to recruit 10 people to enrol in the wananga's Mahi Ora programme - a free, home-based life skills course.

Act Party MP Ken Shirley said in Parliament yesterday the recruitments earned the wananga $90,000 in extra Government funding.

Mr Shirley later said the figure could be as high as $348,000, but said the exact figure was not known because he had been unable to get precise details of the per-student funding for the Mahi Ora programme.

Mr Shirley also alleged that the wananga awarded a $12 million contract to airconditioning and refrigeration company Power Chill without putting it out to tender.

The company is owned by the son of wananga chief executive Rongo Wetere, who is a salaried executive at the wananga.

Education Minister Trevor Mallard said it was another matter to add to the long list being investigated by the Auditor-General.

The latest allegations of nepotism and financial mismanagement came as a stand-off continued between the wananga and the Government over the appointment of a Crown manager to control the institute's finances.

Mr Mallard announced on Monday, as part of a package of Government interventions, if the wananga wanted to get a bank overdraft it would have to give Crown observer Brian Roche control of the purse-strings.

It is understood the wananga is not in a strong financial position and will need its $2 million overdraft facility at the BNZ in the near future or it could face insolvency.

But despite the imminent financial risk, Mr Wetere said the wananga would not hand over control to a Crown manager.

"I think if the Government wants to starve the institute into bankruptcy, that is where it will go," he said on National Radio yesterday. "If they want to withhold funds, then the wananga is doomed and so be it."

Mr Wetere did not return the Herald's phone call yesterday, nor did his legal representative Mai Chen.

Mr Wetere has said the wananga would stave off the financial threat by calling in $6 million it loaned to charitable trust Aotearoa Institute - the parent organisation of the wananga.

But Mr Mallard said it appeared that the loan was illegal, as it had not been properly authorised.

Mr Wetere has also said the institute will start selling some its $100 million in assets to avoid handing over control to the Government.

Mr Mallard said the Government was looking at further interventions to stop this happening.

"Mr Wetere indicated he is prepared to run the institution into the ground rather than hand over the cheque book."

Mr Mallard hinted the wananga's funding would be withdrawn.

"I am absolutely opposed to pouring money down a black hole if an organisation is hell-bent on its own destruction."

Under the Education Act the minister can dissolve an institute's council and appoint a commissioner if there is a serious financial risk to its operation or its long-term viability.

New claims

Act's Ken Shirley alleged in Parliament yesterday:

* The tertiary institute signed a contract worth $12 million with the son of chief executive Rongo Wetere without it going to tender.

* The institute earned thousands by getting students to recruit people for a free life skills course.

Government's man has finger on the pulse

The man the Government has installed as Crown observer at Te Wananga o Aotearoa, Brian Roche, has held many trusted appointments, including a similar position at the Northland Polytechnic.

He is a senior partner at PricewaterhouseCoopers, the chairman of the Auckland Regional Transport Authority and a Government negotiator with industries to curb emissions of greenhouse gases.

Previously held positions include: chief executive of Housing New Zealand; chief executive of the Treasury's Crown Company Monitoring Advisory Unit; a member of the Government's expert panel on leaky building responses and chief Crown negotiator in settling Ngai Tahu's Treaty of Waitangi claim.