MUDTOPIA QUESTIONS BLOCKED AT COUNCIL: RDRR CALLS FOR FORENSIC AUDIT

Press Release: Rotorua District Residents and Ratepayers, 15 July, 2018

When Cr Raj Kumar sought to raise Mudtopia as a matter under urgency at the Strategy, Policy and Finance Committee of Council, on 12 July 2018, the Chair, Cr Raukawa-Tati, responded; “That’s been done and dusted. It’s been and gone. No thank you. That’s been addressed already in our previous Operations and Monitoring meeting with a paper presented and discussed.”

Cr Peter Bentley then pointed out that “Madam Chair, this is a matter of ongoing interest to many of the people of the public who feel that the Mudtopia issue has not been handled full well and there are an awful lot of gaps that still need to be filled in with regard to the accounts, and so forth.”

The Chair ruled “That is not an urgent item and has been before a standing committee and it is not appropriate that we go through it again. We have had reports on that, so I am not going to allow that as an urgent item.”

Council’s Standing Order 3.19.2 permits a chairperson to rule on the basis of their opinion as to whether a matter is of urgency or major public interest. While the degree of urgency may be arguable, the accounts provided by Council remain highly salient, as would have been demonstrated had the Chair allowed Cr Kumar’s statement to be heard. It follows.

“I have a statement to read and two questions to ask, and request that I be heard without interruption. It is very serious.

Many people visit my shop every day. The most common concern they have is about Mudtopia.

Some have read the Official’s Report given to the O&M Committee on 3 May that said that $523,491 was spent on “Festival Management” and that $955,796 was spent on “Other Expenses”.

These numbers were broken down on 31 May, in response to a LGOIMA request, and widely publicized in the Rotorua Daily Post on 4 July. The Festival Directors from Event Engine Limited, Simon Brady and Scott Rice, had received $397,996. $778,272 had been paid for “Materials and Services provided”.

In my opinion, and in many people’s view, these numbers are grossly excessive and the categories far too vague. There is public speculation about kickbacks.

Event Engine Ltd stopped trading in January 2018 and has not submitted an annual return to the NZ Companies Office. The Companies’ Registrar indicates it may be removed from the companies register, possibly for the Directors to escape liability.

My questions are:

1. Can Council direct the Audit and Risk Committee to commission an independent and forensic audit of a detailed profit and loss account of the event?

2. Given falling public confidence in the propriety of the transactions around Mudtopia, should Council refer the forensic audit task to the Auditor General?”

The ruling also blocked Cr Peter Bentley’s prepared motion: “That Council direct the Audit and Risk Committee to commission an independent and forensic audit of Mudtopia, and consider referring the task to the Auditor General”.

Members of the Rotorua District Residents and Ratepayers consider the chair’s ruling unacceptable, and given the high degree of continuing public disquiet, urge Council to consider commissioning a forensic audit. To prevent a possible evasion of legal liability, RDRR Secretary Reynold Macpherson applied to the Companies Office on 12 July to stop Event Engine Ltd from being wound up.

Dr Macpherson said that “If Council refuses a reasonable request for a forensic audit of Mudtopia accounts, residents and ratepayers can be forgiven for believing that irregularities may have occurred, and that a direct request to the Auditor General for an inquiry may the only course of action left to eliminate the possibility of corruption.”

© Scoop Media