Audits lift the lid on problems at trust
The failed Te Rapuora Trust had a ‘‘dysfunctional’’ board, did not detail conflicts of interest, and some staff did not have proper training, audits show.
The Nelson Marlborough District Health Board and Ministry of Health audits also reveal that the Maori health provider was overpaid more than $150,000 by the DHB for staff positions that were either not filled in time or were under-resourced.
They also found that three vehicles bought in February last year were purchased without proper authority, and that the son of the board chairwoman had the rent-free use of part of the trust’s Blenheim premises for a gym.
The audits of the trust’s finances and management, released under the Official Information Act, were carried out in October and November last year.
The trust, Te Rapuora o te Waiharakeke, closed at the end of the year because of financial problems. It is now in liquidation.
It was the first Maori health provider in the South Island, and served the Maori community in Nelson and Marlborough for 26 years. Services have since been picked up by four other Maori health providers.
The ministry’s financial audit found that while the trust was solvent at June 30 last year, it would have become immediately insolvent if it had to return funding overpayments.
Under the trust agreement with the DHB, the board had to be notified of any frontline job vacancies, and funding was to stop after two months if the position was not filled. The audit found that the trust under-resourced or did not employ staff for longer than the two-month period, resulting in an overpayment by the DHB of $151,248.
The trust was also liable to repay $32,000 to the ministry for not meeting obligations in its funding agreement.
The review identified eight family members of a Te Rapuora trust member who were employed or had been employed by the organisation or received funding from it.
The name of the member was blacked out in the copy given to the Nelson Mail. But the report noted that the trust chairwoman had disclosed on two occasions in 2011 that contracts related to her sons, and excused herself from any decisions.
The chairwoman, Margaret Bond, did not respond to requests for comment.
One of Ms Bond’s sons was also a tenant of the trust’s leased premises in Grove Rd, Blenheim, the review noted.
James Skipper opened the Bad Boy Boxing Gym in January 2011. Board minutes stated that through an agreement with the previous manager, no rent was charged. This agreement was extended for another year in August 2011.
Ms Bond had excused herself from that decision.
Te Rapuora said it had a conflict of interest register and made disclosures in board minutes, but they did not include familial or other relationships.
A separate routine audit of the trust for the DHB found that the conflicts register had not been updated since 2006.
That report found significant issues relating to the board’s performance. The manager, chairwoman and a board member all described the board as ‘‘dysfunctional’’.
The report also found evidence that community support workers were working outside their scope of practice.
One example was a worker doing wound dressings with no evidence of training in this. Three staff were working in mental health areas, including two in a mental health day programme, but did not have relevant training.
NMDHB Maori health director Harold Wereta said the DHB completed routine audits of community providers every three years, and Te Rapuora had been on the schedule for 2012.
‘‘The DHB was aware of service performance issues which were being addressed with Te Rapuora management, and we had been notified in March 2012.’’
Mr Wereta said the DHB was receiving legal advice on its options to recover overpaid funding.
‘‘We are also speaking to the liquidator, and have registered this amount owed to the DHB.’’
The Companies Office website says Geoff Falloon was appointed liquidator of Te Rapuora on December 24, and the last day for creditors to make their claims is February 10.
Mr Wereta said the information from the reports had been used to strengthen the new contracts the DHB had in place with other Maori health providers.