20 Mar 2014

Kohanga funds may be at risk

10:04 pm on 20 March 2014

The Education Minister is indicating government funding for Te Kohanga Reo Trust Board may at risk if it does not fully address allegations of mis-spending and restore public confidence.

Hekia Parata has called in the Serious Fraud Office to investigate allegations regarding the board's commercial arm.

Hekia Parata speaking to reporters at Parliament.

Hekia Parata speaking to reporters at Parliament. Photo: RNZ / Chris Bramwell

An Ernst & Young review found there was no misuse of public money by the Kohanga board. But as the money handled by its wholly owned subsidiary Te Pataka Ohanga is not deemed to be public money, the review did not look into the allegations that business credit cards were mis-used.

In the 12 hours after the report was released, a trustee came forward with further concerns over Te Pataka Ohanga, Ms Parata said on Wednesday. She said the allegations had been referred to the SFO because it is in the public interest but she does not know how much money is involved as the Government does not own Te Pataka Ohanga.

Despite being asked repeatedly to confirm its future funding on Thursday, Ms Parata kept saying that while the trust board was delivering the services it was required to, it had not adequately dealt with persistent allegations.

Meanwhile, the minister's office has confirmed the Ernst & Young report cost about $90,000.

Kohanga members admit time for change

The embattled Kohanga Reo National Trust has rejected claims its board members are not up to their job, but admits it is time for a change.

Kohanga Reo National Trust HQ in Wellington.

Kohanga Reo National Trust HQ in Wellington. Photo: RNZ / Diego Opatowski

Maori politicians have criticised the board in the wake of allegations of mis-spending by the commercial arm of the trust, saying its members are not fit to govern the organisation that oversees New Zealand's 450 kohanga reo Maori preschools.

Mana Party leader Hone Harawira and Labour Party MP Shane Jones say some of the trustees are appointed for life but do not have the right skills to govern an organisation with a budget of nearly $100 million a year.

Trust board spokesperson Derek Fox said members are the sort of people who have been running kohanga reo successfully for 32 years, and long-term membership provides stability.

Though kohanga reo around the country are supporting the trust, Mr Fox said, there are members of the trust board who themselves have said it is time for a change. "An opportunity I guess to discuss those sorts of things will occur next month when Kingi Tuheitia is hosting a meeting of kohanga reo people at Turangawaewae."

Parata accused of mishandling review

Hekia Parata is being accused of mishandling the review into alleged mis-spending.

Greens' co-leader Metiria Turei.

Greens' co-leader Metiria Turei. Photo: RNZ / Chris Bramwell

Green Party co-leader Metiria Turei said the ministers knew about the allegations for many months before they initiated the investigation and she cannot understand why there has been such a long delay.

Ms Turei said they have waited to do a proper review until after the Ernst & Young report and now they are taking it to the Serious Fraud Office. "I'm very concerned that the ministers aren't taking responsibility for their failure to act when they first heard that there were issues with the spending."

New Zealand First leader Winston Peters said he does not believe the allegations that prompted the SFO referral are new because people have been talking for a long time within Maoridom about their concerns. "Why the minister would have heard that in the last 12 hours when we've been hearing it for the last 36 months is beyond me."

Labour Party MP Shane Jones said a letter to the SFO is an attempt to close down the story. He said it is hard to imagine new information has been made available that the ministers did not already know about, and if that is the case it suggests the whole investigation was what he calls "a brown-wash".

Mr Jones said if he is the next Maori Affairs minister Te Kohanga Reo Trust Board will be on notice, because he does not believe the mix of personalities currently there are capable of fulfilling governance responsibilities.

Prime Minister John Key, who is on a visit to China, has backed Ms Parata's action in referring the matter to the Serious Fraud Office. "The minister is taking the issue very seriously, and rightfully so. The spending of taxpayer's money and the integrity of that is important to every New Zealander."

The Department of Internal Affairs (DIA) confirmed on Wednesday that its charities services division is investigating the Kohanga Reo National Trust. The department would not comment on the exact nature of its investigation, but Ms Parata said she understands it relates to Te Pataka Ohanga.

Programme snubbed, says presenter

One of the television journalists whose programme broke the Kohanga Reo Trust story said the programme now appears to have been deliberately snubbed.

The allegations of mis-spending were revealed by Maori Television's Native Affairs programme in October last year, sparking the review.

Ernst & Young looked into claims that Te Pataka Ohanga's general manager, Lynda Tawhiwhirangi, mis-used business credit cards to pay for dresses, fuel and accommodation. She was suspended in October last year after the allegations surfaced.

Native Affairs presenter Mihingarangi Forbes said despite regularly calling the minister's office about the issue, she heard about Tuesday's news conference announcing the review outcome only second-hand.

She told Radio New Zealand's Morning Report programme calls had not been returned, and it was hard to see it as anything other than a deliberate snub, when her programme had a lot of questions that need to be answered.