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FEC Calls In Auditor-General On Transend

National MP Hon Murray McCully and ACT MP Rodney Hide said today that they were pleased that the Finance and Expenditure Select Committee had concluded its lengthy financial review of NZ Post with a call for the Auditor-General to undertake a full audit of NZ Post's Transend.

"The Committee's review of Transend revealed three serious problems: a culture of corporate extravagance at the taxpayer's expense, NZ Post managers unable to control or check expenditure, and a Board that had failed in its governance duty.

"NZ Post is owned by the taxpayers of New Zealand. It employs ten thousand people and turns over a billion dollars a year. NZ Post is a business critical to the success of New Zealand economy.

"The Committee discovered a performance by NZ Post's Board and management that fell well short of acceptable practice in any business state or private whether large or small.

"The Financial Review was made difficult by NZ Post failing to answer questions clearly and honestly. NZ Post appeared through the Committee hearings not to accept the need to be held to account to the taxpayers of New Zealand. The FEC's report slams NZ Post for proving "unhelpful" in providing requested information and declares that, "We do not expect to be treated this way by any organisation that appears before this committee, including State enterprises". Chairman Dr Ross Armstrong and CEO Mr Elmar Toime are now before the Privileges Committee for having misled the Committee.

"NZ Post's failure to pass the FEC's review reconfirms our view that Minister Mark Burton, Board Chairman Dr Ross Armstrong and CEO Elmar Toime must go. These three men have overseen the waste of millions of dollars of taxpayers' money and, damningly, still refuse to accept that anything is awry. The Committee's unanimous decision after a six-month review to call in the Auditor-General shows just how wrong they are.

"The Financial Review was a difficult one as the Committee had to balance the need to protect the commercial interests and reputation of NZ Post against the need to hold management and the Board to account. The Committee's work and recommendations clearly demonstrate that the Parliamentary system can work and sends a firm signal to all government departments and SOEs that Parliament's Financial and Expenditure Committee will indeed be holding them to account on behalf of the New Zealand taxpayer.

"The Auditor General has now a big job on his hands. We trust that NZ Post's Board and management will now put an end to the spin and games that the FEC had to endure and co-operate with him and his team. The Auditor General should begin his investigations with the Mander Report documenting staff allegations against Board and management and Deputy Chairman Mr Syd Bradley's 6 September 2001 letter to Chairman Dr Ross Armstrong that documents some of the key issues. We look forward to assisting the Auditor General in his inquiries.

"Finally we pay tribute to the men and women many of whom remain unknown to us who risked their careers and legal action to bring to our attention the financial shenanigans at NZ Post. They blew the whistle on NZ Post's management and Board only after exhausting all other possible avenues open to them. We have done our best to protect them while assuring the accountability that all taxpayers deserve and desire. They are brave people motivated to help NZ Post and the country move forward. We thank them.

Ends

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