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No conflicts in ex-Housing NZ staffers' consultancy

Wednesday 4th April 2012

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There were no conflicts of interest in former Housing New Zealand staffers setting up a consultancy that taps the skills of a British software supplier involved in an $80 million departmental transformation project, according to chief executive Lesley McTurk.

The Housing NZ boss told Parliament’s social services committee she was not aware of any conflicts in former chief operating officer Stephen McArthur and former chief financial officer Roy Baker setting up Wellington-based consultancy Tinakori Group in February.

Tinakori names Northgate, a British supplier to Housing NZ’s Enterprise Transformation Programme (ETP) as a ‘strategic business partner’ on its website.

The pair left Housing NZ in the latter half of 2011, having previously worked in senior roles on the ETP, which has exhausted an $8 million contingency fee and is expected to produce further costs of up to $8 million.

“There was no conflict of interest that I was aware of at the time of their employment at Housing New Zealand with Northgate” McTurk said. “What their consultancy arrangements are now is not Housing New Zealand’s business.”

McTurk said she raised the matter with Northgate when details of its relationship with Tinakori emerged.

Tinakori provides advice on business transformation policies, strategic leadership and planning, and builds and develops operational policies and measurement frameworks, according to its website. The company’s other directors Sarah Hill and Kevin Black are also ex-Housing NZ staff.

The agency’s chairman, Alan Jackson, told the committee the ETP project had drawn down on an $8 million contingency, taking the budgeted cost to $80 million, and will probably incur over-run costs of between 5 percent and 10 percent, or $4 million to $8 million. One of the major plans will see a call centre field the majority of tenant inquiries that don’t require more intensive handling.

The project will see the department install Northgate and Oracle software to align its business processes and replace ageing technology in a bid to cut costs, which McTurk said would save in the realm of $400,000 this year, rising to $75 million by 2015.

McTurk said the department is in the process of reassessing its housing stock, with about a third of its 70,000 houses the wrong place, wrong size or wrong condition to meet future needs. She flagged 1,400 new houses for the Auckland area to meet rising demand.

Housing NZ is setting up commercial relationships with businesses, iwi and non-profits in new developments, she said.

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