KEY POINTS:
Sacked members of the Hawkes Bay District Health Board are furious that they did not get a final face-to-face meeting with a review panel before it last week issued its damning report into conflicts of interest at the DHB.
They question whether the review team headed by MidCentral DHB chairman Ian Wilson ensured natural justice in its inquiries.
Former DHB members, such as Kevin Atkinson (chairman) and Peter Dunkerley, each of whom are criticised in the report, are considering legal options. But the board has a financial deficit and former board members can no longer access DHB funds for a challenge. Even getting access to board papers will be difficult unless Commissioner Sir John Anderson gives permission.
The report slammed the former board for failing the most simple test of good governance. But, in contrast to the panel's preliminary findings circulated late last year, the final report only mildly criticised Government-appointee Peter Hausmann for failing to make adequate disclosures concerning a proposed joint venture between the DHB and his company, Healthcare New Zealand.
National MP Tony Ryall has labelled the report a whitewash, claiming it was an about-face from the draft report. He told Parliament the initial findings strongly criticised Hausmann for dealing with DHB management on the terms of reference for a community services tender without the board's knowledge.
Hausmann met the panel in Wellington on February 20, with fellow Healthcare NZ director Ken Douglas. Douglas said Healthcare NZ wanted the meeting to ensure the company's position was recorded correctly. Healthcare NZ directors had been incensed by the panel's draft findings, which he said did not correctly record the history of the aborted attempt to set up a joint-venture for delivering community services in Hawkes Bay.
"I saw the first draft and read it and said 'What the hell's going on here?'," Douglas said last week. "It was wrong in law and wrong in fact."
He said later material from the panel still did not record accurately the fact that Healthcare chairman Doug Catley, Hausmann and himself had met former DHB chair Kevin Atkinson and chief executive Chris Clarke in December 2004 over the proposal for a joint venture.
Douglas said that a week before the report was due to be released, the inquiry team sent Healthcare's lawyers an extract of the DHB board's minutes that reported on the joint venture discussions.
Douglas says he had a "bloody furious" interchange with Wilson over the matter. "That's why I think they got so vicious with Atkinson [in the final report]."
When asked on Monday, Wilson was non-committal on who had pressed legal buttons.
A Herald on Sunday investigation last year revealed the DHB board scuttled a request for proposal process in February 2006 after a whistleblower, Deborah Houston, drew Atkinson's attention to emails between Hausmann and DHB chief executive Chris Clarke, which she believed went beyond the DHB chairman's instructions.
But the report noted Atkinson was fully aware of Hausmann's early involvement in the tender. "He had a responsibility to make sure the board was fully aware of it, especially as Mr Hausmann, in his first public appointment, was not properly inducted nor trained about conflict management."
The panel also criticised Atkinson for failing to ensure the board managed other conflicts of interest, such as that concerning pharmacist Peter Dunkerley.
Last year, Hausmann drew attention to a letter he had written to former Health Minister Pete Hodgson asking him to initiate a wider review of the board and chairman's performance and governance. He still wanted the inquiry's terms of reference widened.
Hausmann also drew attention to what he called inconsistent treatment and management of the board members' interest register. He said Healthcare's community services proposal would involve a centralised dispensing service for drugs, which he claimed could have financially affected the performance of pharmacies then owned by Dunkerley.
Hausmann also claimed the DHB's chief executive had lost confidence in the chairman. (Atkinson has a note from Clarke expressing his confidence in the board.)
And he raised issues over lab services contracts and drew the inquiry's attention to draft DHB minutes, which stated that another member had claimed the Ministry of Health fabricated documents to provide unbalanced advice to the minister over the community services request for proposal.
The panel's report indicated it did widen its inquiry to focus on governance. It also found Dunkerley did not manage his conflict of interest adequately.
Dunkerley says there is "a lot of hysteria" around the report and he hopes the issues will be debated when things settled down.
But he also believes he and Atkinson should have had a final chance to meet the panel and address the critical issues.
Atkinson believes the inquiry should have addressed other issues that the former board recently uncovered. These include the secret emails between Hausmann and the executive, which Ryall told Parliament showed Hausmann changed tender documents to his advantage. Ryall said both parties withheld these and they came to light only after independent forensic analysis of the back-up tapes.
But Douglas is scathing of any attempt by the former DHB board to challenge the inquiry. "They're going to have to use their private money and so they bloody well should. Hausmann rebelled against sloppy governance - they tried to cover their tracks and got caught."
Health Minister David Cunliffe said former board members could approach the commissioner if they felt that it was in the board's interests. "Certainly, when the commissioner came in he acted to lift an injunction that was being sought by members of the former board, without which it was unlikely that the public would currently have access to the independent review.
"They have the proper opportunity to correct issues of fact and contest issues of judgement, and I'm advised that a range of parties did that. There is only one report and that was the one that was issued."
