Mangahwia Waste Water Scheme

Mangawhai Wastewater Scheme

The Auditor General reports:

"The matters the Office of the Auditor General report covers are long and often complex, but the overall picture is simple. I summarise it as a woeful saga. Overall, the inquiry found that:
• KDC failed to attend to its fundamental legal and accountability obligations.
• KDC effectively lost control of a major infrastructure project.
• Some of the work done on behalf of the Auditor-General has fallen short of the standards I expect. 

Overall, KDC has ended up with a wastewater scheme that works, but it has come at a significant cost. The fact that we cannot put a precise figure on that cost is indicative of KDC’s poor management.
KDC’s records did not contain good or systematic information on the total amount spent. However, our best estimate is that the total cost was about $63.3 million. The overall costs are not just financial. They include a failed council, councillors who have been replaced with commissioners, the departure of a chief executive, a severely damaged relationship between the council and community, an organisation that has needed to be rebuilt, and much more.

KDC’s decision-making processes were also poor throughout the entire 16 years of the wastewater project. KDC relied too heavily on its professional advisers and had a practice of receiving briefings and effectively making decisions in informal workshops. The governance and management arrangements put in place specifically for the project were also inadequate. In our view, these underlying problems made it harder for KDC to deal with the problems that emerged as the

project progressed.

KDC decided that it wanted to explore a public private partnership (PPP) approach, to keep the debt “off the balance sheet” and to put as much risk as possible on to the private sector provider.

In my view, this decision took KDC out of its depth. It followed all the right basic steps when it initially went to the market for advisers and put the project to tender, but it did not fully understand the complexity of what it was doing. The early decision to use a PPP approach put too much emphasis on achieving a certain accounting outcome and the transfer of risk, and not enough on value for
money and affordability. KDC’s decision-making about the PPP was not consistent with the good practice guidance that was available at the time.

KDC’s approach to funding the project was inadequate. It did not do enough to check the appropriateness of the policies it was adopting. The changes KDC made to its Treasury Management Policy meant that it effectively had no borrowing limit for the wastewater project. It also implemented its debt segmentation policies badly.

There were problems with the way some of the audit work of KDC was carried out. The review noted that audit quality varied significantly over the period covered by the review, although there was a notable improvement in later years. The review criticises the quality of documentation in some audit files, particularly the documentation that should explain why particular audit judgements were reached. "

$11 Million scheme escalates to $62 million.

Ratepayers argued that the debt associated with the project was treated unlawfully. National MP introduced a local bill into Parliament to retrospectively validate the illegal rates.

Supreme Court rejects ratepayers claim, resulting in an $115,000 invoice from Kaipara Council to Bruce and Heather Rogan. This invoice had to be paid by 22 May 2020.

Ask yourself if Viranda would have committed the millions of dollars it has already invested in this proposal if it did not have the nod of approval from the KDC, and absolute certainty that the development would be approved exactly as it was proposed

As for Peter Wethey’s comment at the beginning, all that can be said is that the KDC staff make all of the decisions and most of the elected members are in blissful ignorance of what goes on. Just like us ratepayers and residents.

An elderly Mangawhai couple could be kicked out of their own home over a longrunning rates dispute with Kaipara District Council.
Bruce and Heather Rogan say their quality of life has plummeted as a result of the

The Rogan's have been issued a summons by the Kaipara District Council to pay their costs of $115,000. This demand has the potential for the Rogan's to lose their family home for a Council issue that the Office of the Auditor General found illegal and lacking the competence of 'Best Practice'.

We are asking everyone to help the Rogan's financially by giving through 'Give a Little' (click button) or by donating directly to their bank account 38-9012-0318164-00. All help is appreciated.


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