Review of nepotism at EQC had gaps

A $25,000 review of Earthquake Commission (EQC) recruitment processes did not interview four relatives of management employed by the commission and left questions over its examination of nepotism, a report says.

The report shows the review was open to comment only from those selected by the reviewers, Wellington recruitment firm KSJ Associates, and was conducted over a period ‘‘not conducive to the best outcome’’ – the Christmas-new Year break that involved only one week of work.

The criticisms were made by former State Services Commission deputy commissioner Malcolm Inglis in his peer review of the KSJ report. The review and the report were released yesterday.

Mr Inglis said it was not clear from the KSJ report ‘‘the extent to which a full forensic examination for evidence of inappropriate influence was done or indeed possible’’.

The four relatives were considered ‘‘passive participants’’ and not interviewed.

‘‘These factors leave the review and its conclusions subject to criticism,’’ Mr Inglis said, although he concluded that had the shortcomings been remedied, the result would have been the same.

The KSJ review was prompted by revelations of children of senior staff being appointed to highly paid field staff positions after last year’s Christchurch earthquakes and again when the field staff workforce was reduced from about 800 to 200 for this year. Field staff currently employed earn $105,000 for a oneyear contract.

The review looked only at the processes for appointing field staff for this year.

EQC board chairman Michael Wintringham said the KSJ review found the commission’s processes were appropriate and that it had gone to some lengths to ensure they were fair.

‘‘Naturally, not everyone got their preferred outcome, but it’s pleasing that the processes used in these unusual circumstances measure up to external scrutiny, were robust and there was no evidence of bias or nepotism,’’ he said.

‘‘Where KSJ identified weaknesses in the process, there were checks and balances that mitigated these.’’

Mr Wintringham said the selection process had been criticised because it was not open to external candidates and that too few successful candidates were from Canterbury.

‘‘The fact is EQC already had a large pool of experienced assessors and estimators to choose from.

‘‘Given the dramatic reduction that was to take place in their numbers, there was no justification for seeking external candidates. Furthermore, candidates were selected on merit.’’

With regard to claims of bias and nepotism, Mr Wintringham said the KSJ findings were supported in a peer review by Mr Inglis.

‘‘As Mr Inglis says, a family relationship should not favour or disfavour an applicant,’’ he said.

‘‘Selection should be on merit, and that was the basis for appointments in the 2012 recruitment . . . The process required a declaration of any conflicts of interest, including family and other connections with EQC.

‘‘The moderation process and final approval of appointments involved three decision-makers, making it highly unlikely an appointment would be inappropriately influenced.’’

The report shows the recruiters did not consider work experience in selecting field staff.