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08 November 2006
CCO report indicates double-dipping
A Manukau City
Councillor is questioning the practices of Tomorrow’s Manukau
Properties Limited, the council controlled organisation set up by
the Manukau City Council to develop Flat Bush Town Centre.
Following the release
of the company’s annual report, Howick Councillor Jami-Lee Ross
has expressed his concern over the apparent “double-dipping” by
one of the company’s directors where $129,700 worth of
professional services were provided to TMPL by Conway Davy
Limited.
The owner of Conway Davy Limited, Christchurch
based businessman Raymond Davy, is also a director of TMPL after
being appointed by the Council to the CCO’s board in 2005. In the
annual report covering the 9 months to 30 June 2006, the company
disclosed the amount paid to Conway Davy Limited, as well as an
additional $19,313 expense bill still owed to Mr Davy.
Mr Ross says he is concerned by the large amount of
work done by Conway Davy Limited because it blurs the important
line between governance and management. “As a company operating on
behalf of Manukau City ratepayers I would have expected to see a
higher standard of conduct. TMPL should not be in a situation
where it is contracting tens of thousands of dollars of work from
a company owned by one of its directors.
“Mr Davy is acting in
a position where he is making decisions as a TMPL director and
then carrying out those decisions via Conway Davy Limited. It is
akin to a councillor owning a company which has a $100,000
contract with the council. The public would never approve of the
situation.”
Mr Ross has written
to Manukau City Council chief executive officer Leigh Auton
questioning the details of the situation between TMPL and Conway
Davy Limited. Mr Ross has questioned whether Conway Davy Limited
is continuing to provide professional services to TMPL, and
whether or not the CCO followed correct practices when
commissioning the work from Mr Davy’s company.
“It appears that TMPL
have not sought competitive tenders for the work which would be
normal practice when awarding contracts of this value. Instead
TMPL has given the job directly to Conway Davy Limited.”
Mr Ross has also
asked Mr Auton to investigate how TMPL’s $26,327 travel bill has
been spent by directors and whether or not Mr Davy received
reimbursement for travel solely as a director of TMPL, or also in
conjunction with his work involving Conway Davy Limited.
Mr Ross says that
although he believes CCO’s have the potential to generate a lot of
benefits for Manukau City if correct practices are followed, he
fears that the situation between TMPL and Conway Davy Limited has
embarrassed the Council and will have a negative impact on the
work done by other CCOs.
“The practices being
carried out by TMPL are embarrassing and out of order for a
council controlled organisation. If Mr Davy wishes to continue in
an executive position working for TMPL, then he should resign his
position as director of TMPL. It is not appropriate for him to
continue as a director if his company is carrying out tens of
thousands of dollars of work for the CCO.”
In addition to the
$129,700 worth of professional services provided by Conway Davy
Limited, TMPL’s annual report lists Mr Davy as receiving $15,000
in director’s fees.
ENDS
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