DHBs reminded to keep eye on CEOs

DISTRICT health boards have been reminded by the auditorgeneral to keep a close eye on their chief executives.

Last year, Waikato DHB chief executive Nigel Murray resigned after issues arose with his expenses: an investigation found the former Southland DHB chief executive spent $120,608 on unjustified travel and accommodation.

A letter sent yesterday to chief executives and chairmen of district health boards by Greg Schollum, deputy controller and auditorgeneral, said DHBs only employed one person — the chief executive.

‘‘It is vital that boards exercise their oversight of chief executives with diligence, demonstrating awareness that the tone and culture set at the top of the organisation is ultimately the board’s responsibility,’’ Mr Schollum said.

He also reminded DHBs of the provisions of the Protected Disclosures Act — the ‘‘whistleblower law’’ — and that disclosures could be made to the auditorgeneral under that legislation.

‘‘I would like to remind senior staff at DHBs that, if they have concerns about financial mismanagement or misuse of public funds in their organisation, regardless of the level at which it occurs, they should bring it to the attention of their auditor,’’ Mr Schollum said.

‘‘All DHBs should ensure that their policies and processes for protected disclosures are up to date, easily accessed, and understood by their staff.’’

Mr Schollum’s letter was written to alert DHBs to issues arising from the auditorgeneral’s annual review of DHBs.

Highlighted issues included:

DHBs needed to improve asset management requirements.

DHBs could strengthen contract management.

DHBs needed to approach financial yearend cutoffs and valuations consistently and not make judgements biased towards a particular result.

Mr Schollum said DHBs were finding it increasingly difficult to live within their means, and nationally DHB deficits for the audit period had been more than $119 million — $60 million over budget.

‘‘Several DHBs are operating savings plans and taking steps to reduce expenditure and/or gain efficiencies,’’ he said.