Auditor gets free rein to probe Housing NZ claims

Kevin Brady

Auditor-General Kevin Brady has been given a free hand to investigate a whistleblower's allegations against Housing New Zealand Corporation (HNZC), and its attempt to keep him quiet.

The final terms of reference for the inquiry were released on Monday, and one states Mr Brady will find out "in particular" whether chief executive Helen Fulcher authorised the confidentiality deal or was aware of it in advance.

The whistleblower, a former contractor with the corporation, was told in a letter late last year that $3000 owed to him would not be paid unless he agreed not to take allegations of accounting irregularities to the media, MPs or ministers.

It has outraged opposition MPs who are demanding that Ms Fulcher be stood down in the same way as Gerard Coles, the senior manager who signed it off.

Housing Minister Chris Carter and HNZC's board chairman, Pat Snedden, have both described it as a serious mistake.

In terms of the inquiry, Mr Brady will also be able to investigate any other matters he "considers it desirable to report on".

In a statement last night, HNZC revealed that the allegations made by the man, who has not yet identified himself, were of three main types:

* That certain accounting practices in respect of HNZC's housing modernisation and maintenance programmes were inappropriate and produced misleading financial results.

* That certain inspection activities relating to those programmes were carried out inadequately, or not at all.

* That the contractor was subjected to bullying by other staff in response to his disclosures.

Mr Brady will investigate the events leading up to the confidentiality agreement, how it was negotiated, how its terms were arrived at and what advice was taken about it. He also has a mandate to find out who authorised the agreement "and in particular whether the chief executive officer of HNZC authorised the agreement or was aware in advance of its terms".

Mr Brady's completion target is May 19.

Earlier today the whistleblower said Ms Fulcher did know about the "gagging clause" in the letter.

"I know for sure, for 100 per cent, that Helen Fulcher knew about these discussions," he said on National Radio.

He said other people had shared his concerns about accounting irregularities and had taken issues to senior management, but they had not been investigated.

- NZPA