Legal action over 'botched' scheme

Auditor General of New Zealand Lyn Provost at a Mangawhai community briefing in 2013. PHOTO: FILE

Kaipara District Council has filed legal proceedings against former chief executive Jack McKerchar and the Auditor General over the controversial Mangawhai Community Wastewater Scheme that ended up costing ratepayers about $57 million.

In August commissioners running the council voted to pursue Mr McKerchar through the courts for his handling of the "botched" system around the process that was initially estimated to cost $10.8 million.

Kaipara chairman of commissioners John Robertson confirmed papers were filed about a week before Christmas against Mr McKerchar in the Employment Relations' Authority and against Auditor General Lyn Provost in the High Court.

He refused to discuss the cases as they were before the courts.

It's understood the case against Ms Provost may relate to her earlier admission of poor work done by the Audit Office when scrutinising the council books.

Mr McKerchar and Ms Provost will be given an opportunity to file statements of defence before hearings take place. Mr McKerchar could not be contacted for comment on this story.

A check revealed legal proceedings against Ms Provost were filed on December 11 with the High Court in Wellington but no hearing dates have been set down as yet. Her office refused to comment when approached.

"Since August 2014, when Kaipara District Council announced that it will take legal action over the Mangawhai Community Wastewater Scheme, the matter has been in the hands of our insurer," said Tamar McKewen, spokeswoman of the Auditor General's office.

Kaipara ratepayers were told the final scheme would cost no more than $10.8 million when it was first announced in 2003.

That figure ballooned to $37 million in 2009, while at the same time the council took out a loan for $57.978 million for the scheme.

In a report condemning the decision-making around the scheme last year, Ms Provost said the council's decision to basically double the size of the project from $35.6 million to an estimated $57.7 million "wasn't appropriate".

There have been calls from Kaipara ratepayers to hold Mr McKerchar accountable for his role in the botched scheme.

Mr Robertson earlier said the former chief executive should be held to account for his role in the previous elected council's failure to assess and set rates legally, to ensure a number of statutory requirements were met and its failure to manage its finances prudently.