By JOHN ARMSTRONG
TVNZ stars face pay cuts and tighter board scrutiny of their salary packages, the network's new chairman confirmed after a parliamentary grilling yesterday.
The select committee hearing into TVNZ also witnessed chief executive Rick Ellis expressing personal regret for hiring newsreader John Hawkesby on a salary of $750,000.
But after persistent questioning from National MPs, the Government-appointed chairman, Dr Ross Armstrong, finally admitted that senior managers such as Mr Ellis who approved Hawkesby's contract would not be held to account for the fiasco.
Instead, he blamed TVNZ's previous board for the $5.2 million settlement paid to the former newsreader, saying the board's oversight of major managerial decisions had been unsatisfactory compared to other state-owned companies.
National's Tony Ryall said Dr Armstrong's statement that managers such as Mr Ellis would escape Scot-free made nonsense of the Prime Minister's call for "heads to roll."
Yesterday's commerce select committee probe of TVNZ bosses and the hiring and firing of Hawkesby lasted just over an hour.
With the committee room packed with journalists, Mr Ellis admitted that "in hindsight" he regretted signing Hawkesby's contract in early 1998. However, he had been in the job less than two weeks and was hardly in a position to challenge the "enthusiastic and calculated" recommendations of other executives.
After signing Hawkesby's contract, he took steps to ensure the chief executive was not exposed to a decision of such magnitude again without referral to the board.
Paul Holmes, who earns between $700,000 and $800,000, last night refused to comment on the possibility of a pay cut from TVNZ, saying he "never commented on contractual matters."
One TVNZ source said there were huge differences between the salaries paid to Holmes, the lesser salaries paid to Judy Bailey and Richard Long, and those paid to the lower tier of newsreaders.
Bailey's salary has been variously estimated at between $300,000 and $400,000. She has vigorously denied a higher figure. The bottom end of the scale for presenters is around $130,000.
The source said the "top tier" of newsreaders would likely be tied into long-term contracts, making it difficult for TVNZ management to roll back salaries when they next came up for renegotiation. Cuts could therefore be more likely to fall among the lesser-paid producers, reporters and presenters.
Dr Armstrong said the board was looking at employment contracts and, given a lack of competition in the industry, it was "very likely" that presenters' salaries would be reduced.
Asked who should be held to account for the Hawkesby affair, Dr Armstrong pointed his finger at the previous board, chaired by Rosanne Meo. Accountability had to stop there, he said. It was "very hard" to make the chief executive accountable for what had happened.
The relationship between the TVNZ board and management was "loose" compared to New Zealand Post, which he had chaired for six years. Lines of accountability present in other state-owned enterprises were absent at TVNZ - and that was the board's responsibility.
Earlier, Mr Ellis sought to soothe MPs on the committee with a PR-style presentation outlining how TVNZ was successfully fulfilling its social obligations. He said the company was already anticipating Government policy by strengthening the balance between cultural objectives and commercial outcomes, particularly in local programmes and advertising.
Pay cuts loom for stars at TVNZ
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