Transparency needed in PGF: report

WELLINGTON: The auditorgeneral says the $3 billion Provincial Growth Fund (PGF) needs to be more transparent about how it operates.

That is one of three recommendations in a report released yesterday.

But Regional Economic Development Minister Shane Jones, who is in charge of the fund, said he had seen no evidence officials had not been open about how the money was being spent.

Mr Jones did not agree with other findings in the report — he utterly rejects that the PGF has been tainted by unmanaged conflicts of interest — and in his mind, transparency problems do not exist.

The recommendations are.—

The Ministry of Business, Innovation and Employment (MBIE) further strengthens transparency about the operation of all parts of the fund’s application, assessment and decisionmaking processes.

MBIE and the Ministry of Transport work together to continue to enhance consolidated reporting and more meaningfully report to Parliament and the public on the fund as a whole.

MBIE completes and publishes, as quickly as possible, a plan for evaluating the overall effectiveness of the fund to ensure transparency of how officials plan to give assurance to Parliament and the public about what it is achieving, both regionally and nationally.

Auditorgeneral John Ryan told RNZ that even though the fund was a work in progress, there were some areas that still concerned him.

‘‘There is some reporting of funds that have been given out to different funds . . . There is some reporting on jobs, although we mention in the report that is a very hard number to verify and to see whether it meets the requirement of the fund.

‘‘So what we are expecting is that there is much clearer reporting consolidated across the fund about what was expected, where we’re at against that and what’s been achieved.’’

Mr Ryan noted that — as acknowledged in the report — the fund was still a ‘‘work in progress’’.

‘‘All the money has not been allocated and all the money has not yet been spent, either.

‘‘What we’re expecting at this stage is to be able to see all the projects that were funded, what was expected of those projects and what’s been achieved . . .

‘‘Ultimately, what we need to know is if there is value for money in $3 billion of public spending, and a plan needs to be in place to evaluate that now.’’

Mr Jones said the auditorgeneral had identified how MBIE could tighten up its processes and how to bring greater robustness to project evaluations.

‘‘A lot of the projects are long term, such as the $500 million that was allocated towards the billion trees strategy, so it’s only over a longer period of time as those forests develop that we’d get a full indication as to how it’s turned around the fortunes of climate change, employment and local industry,’’ he said.

‘‘When we created the jobs, to deliver the infrastructure outcomes, many of which are yet to take place, then other jobs will flow after the infrastructure has been developed.’’

The report said it was difficult to find evidence of how manifesto projects had fully met the criteria.

‘‘Well . . . I don’t accept that,’’ Mr Jones said.

‘‘I think the Provincial Growth Fund investment in the Maori Battalion Museum, the racetracks, the KiwiRail speaks for itself. They’ve been incredibly successful.’’ — RNZ