The investigation and subsequent reports were completed by Deloitte under a process that was subsequently found to be inadequate and as a consequence NZTA no longer stands by the findings of those reports — which have been removed from NZTA’s website. NZTA has also apologised to the manager who was the subject of the reports.
The Transport Agency (NZTA) has reopened an investigation into how a senior manager awarded a contract to a company run by a close friend.
contract Photo: supplied
It has also revealed that the manager was accused of blocking competition for a technology contract.
An inquiry found that contract was unfairly awarded.
"There was no procurement plan and the strategy or approach ... was not documented prior to a selection process being undertaken by an external working group ... as the selection method was direct appointment, the Group Manager should have approved the procurement plan."
Shortly afterwards the manager was promoted to one of agency's topmost jobs; 12 senior managers at NZTA were each paid more than $175,000 last year.
He resigned from the agency in March and is now an independent consultant.
Also in March, an audit by Deloitte was begun into financial, governance and other concerns at the team the manager led.
Deloitte passed its findings to the agency last week. They have yet to be made public.
RNZ has been seeking more information from the agency about contracts the manager had involvement in.
The agency said in a statement released at 6pm last Friday it was reopening an investigation - first done in 2018 internally and that largely cleared the manager - into two contracts awarded to the company run by his close friend.
However, the agency has not said if it would also re-investigate the case of a contract that an inquiry found was unfairly awarded.
In that case, the agency said a supplier in 2015 complained that the manager had dismissed their approach to discuss providing an online construction safety product.
An inquiry found that "a fair and transparent process was not used to give all suppliers a contestable process to compete".
This broke the agency's procurement rules, though the inquiry said one senior staff member had an opinion that the rules were not clear and another that the process for awarding the business was not unreasonable.
RNZ asked what action the agency took.
"No formal action" was taken regarding the former manager, it said.
The contract was not re-run, it said. It was awarded to a large US company. The agency did not say what the contract was worth.
RNZ has interviewed the manager twice previously, though he has not responded to our approaches about this new investigation.
He has said previously he has not done anything wrong and that he had been subject to repeated allegations over three years within the agency, due to his management style.
The agency has also released under the OIA the report of the 2018 investigation, sparked by a protected disclosure to its risk unit - the inquiry that it has now relaunched.
It and other documents show the manager in late 2014 awarded a $60,000 contract to develop an app for NZTA.
This went to a small Auckland company.
The manager had himself registered the small company early that same year, shortly after he had joined NZTA.
He was also the major shareholder in the small company up until about six weeks before he awarded the contract to it.
By then it was being led by the manager's childhood friend.
The 2018 inquiry said both contracts were run with a competitive process; and this despite being under the threshold set by the government that mandates such a process.
He broke NZTA rules for two years, and he had recognised but had not formally declared a conflict of interest as he should have, it said.
But this may not have been deliberate, it added.
Also, there was no evidence he benefited improperly, the inquiry found.
In a statement late on Friday, the acting agency's chief executive Mark Ratcliffe said he took these issues "extremely seriously".
The agency had begun spot checks of the companies register against senior staff's names.
He also noted how the individuals "primarily responsible for managing the issues" examined by the 2018 investigation - the manager, his manager, and the chief executive at the time - had all left the agency.
The chief executive from March 2016 till early this year, Fergus Gammie, resigned amid the warrant of fitness scandal.
