Wananga - More Hot Suppers Before Bedtime

Well, the Auditor-General's (A-G) sailings carried him in and out of days...and weeks...and months...and all the way over a year, until he finally washed up in the white-water - if you buy the Wetere interpretation of his concluding comments. Hot on the heels of the A-G's report came the Waitangi Tribunal ruling in the Wananga's favour, so they got the best and most deserved Xmas pressy - their survival, plus the right to determine what courses they offer and to whom. Rongo Corp came off next best with a sweet exit deal. Not so lucky were the poor old Wananga workers with their 0% pay rise, the NZ taxpayers (who include a sizeable proportion of Maori), the Cuban entities inadvertently dragged through the mud, and anyone who likes to see the principles of a fair society upheld by its institutions - all of whom are probably feeling that Santa was less than kind to them this year.

A close reading of the A-G's report (LINK) does not in fact support Mr Wetere's assertion pre-empting its release, (LINK) that the A-G did not find evidence of any criminal wrongdoing - the A-G does not even address this issue directly as it was not in his Terms of Reference, he certainly made no finding in relation to it, and he took great care to emphasise that he did not look into the activities of the AI Trust. Re nepotism, to hold that the A-G's conclusions about conflict of interest are an exoneration of the practices at the Wananga is disingenuous beyond belief, if not downright delusional!

So do not despair - the new year may yet see some semblance of justice! Surely some lucky lawyers and police officers got the TWOA Report for Xmas, and are spending their holidays immersed in the grip of this tragi-comedy, where the lead character, who made his first fortune from the misfortune of others (how else can you describe the insurance industry?), then submerges his personal gain for the good of the people only to resurface with yet another personal fortune made from others' misfortune - this time, lack of education. Ah, hubris!! And in the best tragi-comic tradition, the second time round a few companies appear to have been set up to keep it in the family, laughing all the way to the bank. Getting the Green Light for the exit deal will keep literary students debating paradox, or abject stupidity, for years - how the canny capitalist retained rights to a literacy cash cow from the cash-strapped Cuban communists who developed it... "consultantism' rules okay! Chuck "em a computer or two, and they'll be happy! Don't worry about petty details like log-frames, project cycle management, or budgets - appoint a project co-ordinator with a fancy title and friends in rich and powerful countries, call them an "international consultant' and no-one will blink twice before parting with their money or their project details. Or maybe the Cubans are in on the deal....it is not unreasonable in the circumstances to expect some clarification of this. But no, they are far too principled to continue to do business with such a discredited bunch of self-serving money-grubbers, regardless of the fact they also did some good - aren't they...?

Bearing in mind that the A-G's report was the end result of an "inquiry', not an investigation, which is an important distinction, could there be some hope that one of these great law enforcement minds might apply themselves in the taxpayer's interests? "Poor decision-making practices for significant expenditure' and "inadequate management of conflicts of interest' in private companies have seen several company directors in the courts, not only here but across the ditch as well. Think Allan Hawkins, think Alan Bond. Given the amounts of money involved, the evidence identified by the A-G (even with his apparently-limited powers and even more limited terms of reference) is surely sufficient to warrant a full police investigation into the Wetere companies and their cosy relationship with the Wananga, not to mention Rongo Wetere's use of the Wananga credit card.

The closest the A-G comes to making any statement of "innocence' is in relation to the use of cash in Cuba, where in his concluding comments on page 78 he says:

8.71 Based on what we saw, we found no evidence to indicate that cash was used fraudulently or was otherwise misappropriated.

Such an equivocal comment as "Based on what we saw" leaves it wide open to surmise that there may very well be evidence that he did not see that may indicate quite the contrary. Regardless, I disagree with the concluding comment that cash was not misappropriated, based purely on the evidence the A-G did see.

Misappropriation

www.dictionary.com defines misappropriation as:

n 1: the fraudulent appropriation of funds or property entrusted to your care but actually owned by someone else [syn: embezzlement, peculation, defalcation, misapplication]

2: wrongful borrowing

On pages 71-77 of his report, the A-G lists considerable evidence of the "wrongful borrowing' by Mr Wetere of money entrusted to his care. In addition to the dodgy records of travel expenses, there are the cash donations made by him to two Cuban organisations, at least one of which (8.56) involved USD$3000 of Wananga funds using the Wananga business credit card. This is the very same business credit card he had such apparent difficulty using for legitimate purposes. The A-G concludes in 8.58:

Even though there was a receipt for both donations, in our view a public entityshould not give donations in cash to foreign officials. This practice is unacceptable.

and in 8.63:

Overall, we expected there to be sufficient information available to confirm that all expenditure on TWOA business was properly incurred and accounted for. This was not the case with Rongo Wetere's international travel.

Am I reading correctly? The A-G obtained and discussed evidence of wrongful practices, concluded that the donations were unacceptable and travel expenditure was not properly incurred and accounted for, then concludes there is no evidence of misappropriation!

Not only does this conclusion fly in the face of your own evidence, A-G, but when anyone else does these things, they usually wind up in court!

Think of it like this - the government gave money to the Wananga to be spent on the education of Wananga students. This makes the Wananga akin to a lawyer's trust fund - you place your money with the lawyer "in trust' and specify what you require it to be used for. The lawyer is then supposed to use it for the specified purposes/s. If they don't, for instance if they use it for their own personal purposes or use it for purposes other than those specified, such as donating it to their favourite charity, then they have misappropriated those funds, however worthy the charity may or may not have been. Even if they "pay it back', they are still guilty of wrongful borrowing.

Just like Mr Wetere, several NZ lawyers, bank tellers, and others entrusted with the funds of others have lost their jobs for spending funds entrusted to them on other things, like themselves or their families. Even though some have even repaid it, like Rongo has repaid a little bit, many of them still faced criminal charges and went to jail. Think Donna Awatere. The courts don't excuse them on the grounds their colleagues didn't provide sufficient "help and advice.' Lesson One, Donna - don't spend it on your kids - buy people you want to impress in other countries some computers instead!

Hundreds of people illegally use credit cards - but unlike Mr Wetere, most of these people also face criminal charges, and are frequently sent to jail. And unlike Mr Wetere most, if not all, of these people did not personally sign off on the rules governing the use of those credit cards.

I would suggest that the A-G has presented sufficient evidence of the misuse of the Wananga business credit card for a criminal investigation, if not a prosecution, to be launched.

Nepotism

The Human Rights Act (1993) prohibits discrimination on the basis of race or family status, ie being a relative of a particular person, and the discrimination prohibition applies to areas of public life including education and employment. Exemption of the Government and its agencies from the Human Rights Act (1993) expired in 2001.

The pervasive conflicts of interest identified by the A-G may well qualify as breaches of the Human Rights Act, and as such, would clearly be unlawful. It is difficult to believe they were inadvertent - the A-G's report noted that despite being identified as early as 2002, the conflicts of interest continued, resulting in an internal review in 2003 of Rongo Wetere's involvement in a subsequent agreement with his daughter, which found a "clear conflict of interest" described as a serious issue, for which there was "no excuse." Even then, the practices continued.

We aren't dealing with a couple of crates of booze left over from the work function that someone took home, we aren't dealing with a couple of isolated incidents, we aren't dealing with a son or daughter getting the nod for a holiday job, we are talking tens of millions of dollars of taxpayers' money seemingly systematically funnelled into conveniently-formed companies over several years, to the benefit of SEVENTEEN members of the same family - not to the benefit the community, not to the benefit NZ society, but to the personal benefit of particular individuals. Mr Wetere apparently didn't learn a helluva lot about the equitable redistribution of wealth during his trips to Cuba.

That Rongo Wetere founded and developed an immensely valuable educational institution is irrefutable. It does not excuse that he failed to manage it in accordance with the most basic principles of good practice and accountability.

Accountability in Cuba

As for the difficulties in obtaining documentation for funds expended in Cuba, I draw attention to the New Zealand film festival held in Cuba in February 2004, funded by sponsorship. The entire budget, including two people travelling to Cuba to participate in the two-week festival, came in at just under $25,000 - less than the travel component alone of the Wananga 2004 trip (Page 81, Figure 10, A-G's report). Per diems for meals and incidental expenses were based on the NZ Ministry of Foreign Affairs per diem rate for the NZ director who attended.

The differences in costs between the two trips are staggering. Documentation for the film festival costs is with my accountant in Wellington, and is evidence that good documentation can, and has been, obtained for funds expended in Cuba, and in the same period of time.

Whilst agreeing that many processes and dealings with Cuban institutions can be incredibly time-consuming, bureaucratic, and frustrating, it is nevertheless possible to do business, including banking, with Cuba in a transparent and accountable way, as the film festival, and the many other NZ businesses dealing with Cuba, can attest. On request, Banco Metropolitano in Havana provides customers with a list of banks in other countries able to provide electronic funds transfers with no problems. The Hotel Nacional, where I believe Mr Wetere and Ms Krawll stayed in 2004, has a business centre and banking services open 12 hours a day, and an ATM that accepts only VISA cards. Whilst ATMs may not be on every corner in Cuba, I have yet to encounter one that distinguishes between a business and a personal credit card - the correct PIN number is the only requisite. I would hate to think that NZ businesses or other entities were deterred from pursuing links with Cuba because of Mr Wetere's largely groundless justifications for his failures to properly account for his spending.

The Cuban Connection

The inference of Mr Wetere's evidence and the A-G's comments, ie that Cuba is some third-rate country in these respects, is offensive not only to Cuban businesses and workers, but also to the principles of the Cuban revolution, in which many people lost their lives fighting to overcome the corruption, nepotism and favouritism rife under Batista and his predecessors' rule - practices similar to many of those highlighted in the A-G's report.

Donations

It is highly unlikely that the Cuban institutions who received "donations' from Mr Wetere were aware that they were in fact receiving NZ taxpayers' funds destined for the most vulnerable sector of NZ society - those who, unlike almost all Cubans since 1959, have been unable to complete their secondary education. "Receiving' misappropriated funds is itself a crime, and I am certain that these organisations would be appalled to consider themselves in such a light, and that most Cubans would be similarly appalled to discover Cuban organisations had accepted funds "borrowed' without authorisation from the most needy sector of NZ society.

It is highly unlikely that these organisations were aware that the person donating those funds had no right, either legal or moral, to do so. Given their cash-strapped situations, it is completely unreasonable to expect these institutions to repay money accepted in good faith. As a person who has worked long and hard, and at my own expense, to build good relations between the peoples of Cuba and New Zealand, I for one would like an assurance that Mr Wetere has made good on the donation from the Wananga business credit card, and repaid the Wananga from his own resources so that the people of Cuba and the people of New Zealand do not feel compromised in their relationship with each other by his behaviour.

Literacy Project

Cuba has a well-deserved high reputation for its literacy programmes, which have been responsible for the eradication of literacy in several Latin American communities, most recently Venezuela. Cuban literacy programmes are more than capable of standing on their own merits. Do they really need the assistance of dodgy entrepreneurs to succeed, or to reach other countries? How many countries will be beating the doors down to buy the Greenlight Programme - especially off an ex-CEO whose slack management practices lost him his job, and a co-ordinator who appears incapable of performing even the most fundamental tasks of project management - developing and sticking to a budget, and project plan? What Pacific Island countries, for instance, would want to be associated with the very practices that they are struggling so hard to eradicate, which have brought countries such as the Solomon Islands to their knees, such as rampant nepotism and mismanagement of public funds? What international donors, who fund the projects in these struggling states, would consider for even a moment spending so much as a cent on the Greenlight Programme with Rongo at the helm? Let us hope that any other countries considering utilising Cuban literacy expertise by-pass these "consultants' profiting from Cuban labour and expertise, and go straight to the source, so that the benefit from the labour goes to those who produced it - the Cuban people.

Cuba has a well-deserved and high reputation for allocating its resources equitably and for the greatest social good, in accordance with socialist principles. Cuba has a well-deserved and high reputation, particularly amongst Latin American countries, for successfully fighting and overcoming corruption and nepotism. Cuba has a well-deserved and high reputation for standing firm against capitalism, against all odds and in the face of the most imposing adversary. Now more than ever the rest of Latin America, and the world, are looking to Cuba as example of what can be achieved through a principled socialist alternative. One of the two most basic fundamentals to the Cuban revolutionary process, universal literacy and healthcare, is at issue here. When the proverbial hit the fan, who did Mr Wetere go running to for help? The socialist Progressive Party? The Labour Party? No, the rightwing National Party. Just what is the deal here? Is literacy now to be sacrificed to a capitalist mode of production, with individuals such Mr Wetere profiting from the labour of the Cuban people through his rights to the Greenlight Project?

The A-G's report serves not only as a timely reminder of the standards expected of NZ public entities and those working within them, but also of the principles of just and equitable societies. Whilst upholding Cuba's right to earn much-needed income from its knowledge and expertise including literacy projects, in light of the A-G's report, the practices highlighted therein and the subsequent terms of Mr Wetere's resignation, and in light of the principles of the Cuban revolution, supporters of Cuba both within and outside New Zealand are understandably wondering just what the nature of Cuba's future involvement with the Greenlight project is to be. Let's hope that like the Wananga, our supper too is still hot.

ENDS

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