Tainui riding high as profit nearly doubles

By JON STOKES

Tainui's profit has soared to $15.8 million for the year despite controversy embroiling the tribe's leaders.

Tainui Group Holdings, the tribe's financial arm, has recorded a second consecutive 90 per cent jump in net profit to continue a remarkable financial turnaround.

The tribe was on the verge of bankruptcy just four years ago when it suffered losses and asset writeoffs of $42 million.

The strong result for the year ended in March saw more than $5.4 million provided to the tribe's social arm, the Waikato Raupatu Lands Trust, which distributed about $1.2 million to its 50,000 members.

The strong result is good news for a tribe racked by leadership battles and damning revelations over its involvement in controversial Corrections Department contracts.

The trust was paid more than $600,000 for Maori consultation on Meremere's Spring Hill prison.

A confidential report alleges tribal staff claimed more than $40,000 in double payments.

The report, released to the tribe's executive yesterday, highlighted poor accountability by management that allowed four staff, including board co-chairman Haydn Solomon, to invoice Tainui and Corrections for more than $10,000 each for the same work.

On Monday the tribe's executive will meet to decide the fate of Mr Solomon as co-chairman. The Herald understands the board will seek his removal for bringing the tribe into disrepute over his involvement with Corrections contracts and for approving a $15,000 personal grievance claim against co-chairman Tukoroirangi Morgan and chief executive Hemi Rau without board approval.

Mr Morgan said he would not comment on Monday's meeting. But he applauded moves, begun by former chairman Kingi Porima, to separate the tribe's financial and social structures and to appoint a Tainui Group Holdings board including former New Zealand Dairy Group chief executive John Spencer and Business Roundtable head Rob McLeod.

"It proves the financial arm is insulated from all the argy-bargy that we continue to confront at the tribe's social level."

The result has also seen the tribe's commercial asset base, which excludes around $40 million in tribal assets held by the lands trust, increase to almost $180 million.

That gives it a combined asset value of $220 million, well up on its original $170 million treaty settlement. The growth followed the creation of a new management team and board of directors in 2002.

Board chairman Mr Spencer said the result reflected the creation of a strong commercial culture and a stable platform to make decisions.

"Today, after two years of reinvention, the group has no external debt and has substantial gains in profitability."

Tainui's portfolio includes property, fisheries, tourism and equities and fixed-interest investments.

Gambling stake 'inappropriate' says Morgan

Tainui's co-chairman has applauded the decision by the tribe's financial arm to sell its shares in Hamilton's SkyCity Casino - an investment he considers "highly inappropriate".

Tukoroirangi Morgan's comments followed Sky City's announcement this week agreeing to buy a 15 per cent holding from Tainui Group Holdings for $10.5 million.

"We must be socially responsible," said Mr Morgan. "Gambling isn't appropriate. I applaud the sale of the shares. This thing devastates families and is a problem for a number of our people."

Research by Auckland University's community health department showed problem gambling affected about half the Maori population some time in their lives, and almost 10 per cent every day, he said.

It highlighted studies showing Maori were two to three times more at risk of problem gambling than Europeans.