$20 million footpaths: Fresh probe

A second officer at the Auckland City Council is under investigation for links to the successful tenderer of two footpath contracts with a combined value of nearly $20 million.

Mayor John Banks has put a further hold on awarding the contracts to John Fillmore Contractors while an internal investigation probes claims that a council officer was at the 2007 rugby sevens in Wellington with John Fillmore and his son, Sam.

John Fillmore told the Herald he was aware of the council officer's presence when he and his son attended the sevens, but did not pay any of his costs.

Transport general manager Don Munro said yesterday that the officer had told him he attended the 2007 sevens, but not as a guest of the contractor.

Mr Munro later said he "suspected" the officer was the guest of a Fletcher subsidiary.

Inquiries were continuing, he said.

The contracts were first put on hold two weeks ago because a member of the evaluation panel, Bernie Sheary, accepted a ham at a Christmas party hosted by Fillmore.

The council's transport committee was due to get a report tomorrow on the tender process and consider awarding the contracts.

Now that meeting has been deferred while two independent reports look at the council's tender processes and an investigation probes the actions of the second officer.

The officer was not a member of the four-person evaluation panel that recommended John Fillmore Contractors be awarded the two contracts, but he does have dealings with the company.

Mr Munro earlier released a list of meetings and social events the council officer has had with John Fillmore Contractors over the past two years, including lunches, a function at a Parnell bar, a rally experience at Maramarua, attendance at two Christmas parties and receiving a Christmas ham "on at least four occasions".

Mr Munro said the council operated in a commercial environment and it was reasonable to expect staff would attend "relationship development activities".

"This is not unusual and does not suggest any sort of improper purpose or somehow undermine proper decision-making," he said.

Mr Banks said the awarding of the two footpath contracts and eight other transport contracts would be deferred until he was satisfied the process was squeaky clean and all the decisions to be taken were above board.

That included the rugby sevens issue, he said.

Mr Banks said the council had instructed accountants Christmas Gouwland to audit the integrity of the 10 transport contracts and asked Audit New Zealand to review the council's tender procurement process manual to ensure it maintained high levels of transparency and accountability.

"This is a very good lesson about real and perceived conflicts of interest," he said.

Mr Sheary accepted the ham after signing a conflict-of-interest form in October. He also attended a rally day hosted by John Fillmore Contractors at Maramarua last August 8 and displayed two photographs as a memento of the event on his desk at work.

Mr Munro said apart from an error of judgment in attending the Fillmore Christmas party and accepting a ham, Mr Sheary had followed the council's disclosure and conflict of interest declarations at all times.

He had disclosed that he had previously worked for Fillmore, but was not required to disclose the rally day in August because it occurred before he was selected for the contract panel.

Fillmore has won footpath renewal contracts worth $105 million over the past five years.