The Auditor General has agreed to pay $5.3 million to the Kaipara District Council in an out-of-court settlement without accepting liability for her failure to monitor expenses relating to the controversial Mangawhai wastewater scheme.
Both parties issued a statement late yesterday to confirm the settlement, reached after a mediation conducted by retired High Court judge Rodney Hansen.
In late 2013, the council took Auditor General Lyn Provost to the High Court for her alleged failure to scrutinise poor work done by the Audit Office when scrutinising the council books over the sewerage scheme. Under the then elected council's watch, the size of the project doubled from $35.6 million to an estimated $57.7 million.
Ms Provost offered an unreserved apology to the Kaipara community for the failings in some audit work carried out by her office but disputed the council's claim for damages arising out of those failings. The council alleged that some of the poor decisions it made could have been averted if her office had performed its responsibilities appropriately. Ms Provost's office yesterday said the amount of $5,375,000 was arrived at through mediation between her office, its insurers, and the council. The money will be paid by insurers. Both parties will bear their own costs in the litigation to date.
Council chairman of commissioners, John Robertson, said the payment was a reasonable settlement under the circumstances. He said the High Court action was meant to first establish there was negligence on the Auditor General's part and therefore damages should be paid.
