Paul Eagle has stepped down as CEO of the Chatham Islands council amid the investigation. Photo / Mark Mitchell
A former MP misled an official probe into his “excessive” spending as Chatham Islands Council chief executive by creating his own financial records, including adding another person’s signature to documents and editing and creating contracts, a watchdog says.
When questioned about the spending by the Auditor-General, Paul Eagle initially denied misleading the investigation and later confirmed he had created or altered the documents because he “panicked”.
The former Wellington Deputy Mayor, who later served as Labour’s MP for Rongotai between 2017 and 2023, said he does not agree with all the report’s findings.
Eagle has offered to apologise to the community for his “shortcomings”.
He resigned from the council last month.
The Chatham Islands Council owns a house that it rents to the chief executive.
The property required work in 2022 and the council budgeted $200,000 of Crown funding for the project.
When Eagle was named as the incoming chief executive in late 2023, he travelled to the Chatham Islands and inspected the house.
After his inspection, he emailed a list of suggested improvements, including kitchen upgrades, replacing the bathroom fittings, replacing the diesel heater, work on the deck and converting the garage into visitor accommodation.
The outgoing chief executive requested to increase the budget to $500,000 to undertake this work, which was later brought down to $460,000 by the council.
Upon starting at the council, Eagle took over managing the project to upgrade the house and “sought further changes to the scope of the work”, the report said.
As part of the kitchen upgrades, the council was quoted $10,000 for Fisher & Paykel kitchen appliances. Eagle later emailed the builder asking for Miele kitchen appliances instead, a premium German brand.
Those appliances were priced at $18,102.45 and were later ordered.
Eagle separately sought approval from the council to convert the garage into visitor accommodation, which councillors rejected. Eagle later continued to work on that aspect of the project himself.
Because he stood to benefit from the spending, it was inappropriate for Eagle to manage the project, the Auditor-General said in its report, released publicly after being tabled in Parliament on Thursday afternoon.
The report said the purchasing of expensive appliances coupled with the work done on the property was “widely considered to be excessive” by suppliers.
“Further, the project was not well managed, and the changes the chief executive requested increased costs beyond what was necessary.”
On at least two occasions during his tenure, Eagle directly engaged consultancy services with a supplier he had a “pre-existing connection” with, the Auditor General said in its report.
Part of the spending was for a 30-year strategy, budgeted at $109,600 (plus GST).
Eagle’s wife was proposed as a subcontractor as the on-island project lead for the work, as she was deemed well-qualified, no steps were proposed to manage the conflict of interest, the report said.
The Auditor-General said it did not see “any evidence that other elected members or council staff were aware of, or briefed on, the existence of a conflict of interest”.
The 30-year strategy plan was ultimately not commissioned due to another project, a governance review of the council, getting priority for consultant work instead.
In total, the council paid the consultancy firm about $350,000 (plus GST) between February 2024 and May 2025, $164,000 of that from the Better Off Funding, a local government initiative of the previous Government aimed at investment in community projects and infrastructure, about $186,000 for the council to cover.
Eagle also received leadership training but the invoices from the supplier for this work went unpaid by the council.
The training supplier threatened to get a debt collector involved, after a back and forth, Eagle offered to pay for the training out of his own pocket and the supplier agreed to withdraw the invoices.
The Auditor-General said Eagle failed to properly document the contractual arrangement with the consultants, was not transparent with the council about how much he was spending on consulting services and the council failed to properly manage the “clear conflict of interest”.
Credit card spending and reimbursement claims were found to be an area lacking oversight.
Eagle was contractually entitled to six return flights between the Chatham Islands and the mainland, but this was not adequately managed, with “little or no consideration of the need to manage the perception risk that people were privately benefiting from this form of public spending”, the report said.
One example of spending that “lacked a clear explanation” was Eagle using his work credit card for $979.43 of spending, filed as simply “food” over a five-day period in May 2024.
The report said that overall travel or accommodation spending was not excessive, but processes around managing the spending were lacking.
Throughout the investigation, Eagle provided documents which had been “altered or created” by him to paint an inaccurate picture of his spending, including adding another person’s signature to them, the report said.
While he initially claimed the quotes and contracts were made by others, he later changed his position and said he made the documents himself.
The Auditor-General found multiple instances of this, including one case involving quotes and contracts for work on his house which appeared to be from the builder but were actually edited or made by Eagle, and another case where dates had been changed on documents.
“The chief executive’s explanation was that he generated or edited the documents to provide an accurate record of what had happened,” it said.
“Rather than provide an accurate record of events, the information that the chief executive provided was misleading, specifically, it created an incorrect picture about when certain events occurred (for example, when a contract was signed) or whether they had happened at all.”
Eagle asked the builder involved in work on the house to provide him with a copy of his signature, which the builder gave and that was then added to the documents.
The Auditor-General said it did not see evidence that the contracts were “discussed with, or shown to, the builder before the chief executive added the builder’s signature”.
It also found Eagle provided misleading information to other public organisations.
“We consider that the chief executive’s actions were unacceptable and demonstrated exceptionally poor practice and judgment”.
The Auditor-General had “not reached a view on the legality of the chief executive’s actions”, the report said, but considered it sufficient to “draw the council, Parliament and the public’s attention to the matter”.
The report said “significant improvements” were needed to fix what it deemed as “seriously concerning” issues at the Chatham Islands Council, specifically highlighting a failure to follow policy and practice, minimal controls over spending, and a lack of integrity and ethical leadership.
Because of its financial challenges, the council would likely not be able to address the problems alone, and would require assistance from central and local government in the form of training and development, support for procurement activity, and investment in record-keeping, financial reporting and contract-management systems.
In responding to the report, the council has accepted the findings recommendations, and said it is undertaking work to make improvement.
Mayor Greg Horler said the council was “focused on moving forward constructively”.
“Our community expects the council to operate with the highest standards of transparency and accountability,’ he said.
“We accept the findings of the Auditor-General and are committed to ensuring that the lessons from this report result in stronger systems and better governance.”
The Herald has repeatedly sought comment from Eagle, but received no response.
He did provide the Auditor-General with a response letter to the draft report, which he asked be published with the final copy.
“I acknowledge the serious issues you have identified in the report, including issues related to my role as chief executive,” Eagle said.
“While I do not agree with everything in the draft report, I accept and take ownership of the concerns about my performance and apologise for any impact it might have.”
Eagle said that because he was required to start in the role earlier than anticipated, due to illness of the outgoing chief executive, he “did not receive a formal, structured induction process covering the policies, processes, systems and documentation expected of the role”.
The decision to take on the role in the Chathams was “motivated by a genuine commitment to the local community and family connections here”, including that of his adopted son.
The council’s financial situation was “more tenuous than I had anticipated” prior to starting, he said.
“Despite the lack of resources and formal processes, I proceeded with confidence to progress the changes I, and the former mayor, thought the Chathams needed to secure its long-term economic future.”
“I accept that my confidence was misplaced and I made mistakes. I regret not seeking guidance sooner.”
His response to the Auditor-General’s investigation “fell short of the standards expected of a chief executive”, Eagle said.
“In hindsight, I recognise I panicked when I realised documentation was incomplete and I tried to fix this,” he said. “I deeply regret that those actions did not meet the standards I expect of myself and my role.”
Actions had already been undertaken to strengthen systems at the council under his watch, Eagle said.
“I would be willing to participate in any suitable hui or engagement process to acknowledge my mistakes and to apologise for my shortcomings as chief executive of their council.”
In a Facebook post by the council on February 12, it was announced that Eagle would “step down” at the end of the month.
“The decision is made following a review of council matters and the parties have agreed that new leadership will better support the long-term funding and sustainability issues to be addressed.”
Ethan Manera is a Wellington-based journalist covering Wellington issues, local politics and business in the capital. He can be emailed at ethan.manera@nzme.co.nz.