Deal not good look, city boss admits

Mark Blake has a 50 per cent share in Australasia Blue, which has been awarded contracts to operate its Face 2 Face health and fitness programme at council leisure centres. Photo / Thinkstock

Contractor who sells fitness packages to gyms run by council - for which he works - says he declared interest.

An Auckland Council contractor has been earning tens of thousands of dollars a year from a fitness programme installed at 10 council leisure services by a company he part owns.

Mark Blake has a 50 per cent share in Australasia Blue, which has been awarded contracts to operate its Face 2 Face health and fitness programme at council leisure centres in West Auckland, North Shore and Manukau.

In the past nine months, the council has paid Australasia Blue about $25,000 in licence fees and $73,368 for member packs. The packs work out at $16 for each new member.

Mr Blake told the Herald he fully disclosed in writing and verbally his interest in Australasia Blue to Auckland Council and the former Waitakere City Council, which he joined about seven years ago to run its Henderson West Wave leisure centre.

"I have been transparent under the guidelines and rules," he said.

Mr Blake said he had also declared in writing to the council a personal friendship with the other 50 per cent owner of Australasia Blue, Ben Davies. Mr Davies is a director of a company, Blue Fitness, one of two companies that won a council contract in June 2012 to supply gym equipment. Mr Blake has nothing to do with Blue Fitness.

Mr Blake said it was his business how much money he had made from the council through Australasia Blue.

Council leisure manager Rob McGee said it was hard to assess the full amount paid by Auckland Council to Australasia Blue because seven of the leisure centres operated by a former Manukau City Council business unit changed over to the council only last year, but the sums were relatively consistent for all centres.

After Mr Blake joined Waitakere City Council, Face 2 Face was put in at West Wave and seven South Auckland centres before the Super City came into being in November 2010. Since then, the programme has been installed at Glenfield and Stanmore Bay leisure centres, where Mr Blake is based in a managerial role.

Council parks, sports and recreation manager Ian Maxwell said the awarding of new North Shore contracts was consistent with the council's procurement policy, but not with its spirit. "In hindsight is this going to look good? No," he said.

The contracts had been under the threshold for open tenders. "These decisions were made in light of information that centres using Face 2 Face outperformed those without it."

Gym fees

• Council contractor Mark Blake is a 50% shareholder in Australasia Blue
• Australasia Blue supplies fitness programmes to 10 council leisure centres
• Council paid Australasia Blue $98,000 in past nine months
• Mark Blake declared his interests in Australasia Blue to council
• Council says awarding of contracts consistent with procurement policy, but not spirit of the policy.