Broadcasting Minister Willie Jackson defends $16.1 million costs of scrapped TVNZ-RNZ merger, next steps

Broadcasting Minister Willie Jackson has denied that the $16.1 million spent on the scrapped TVNZ-RNZ merger is a waste of money – and still hopes it will go ahead one day.

Jackson was being grilled on the merger in select committee today for the first time since it was scrapped in PM Chris Hipkins’ policies bonfire on February 8.

He rejected National MP Melissa Lee’s claim that the $16.1 million exercise was a total waste of money.

“We are talking about future-proofing NZ media and while we don’t have a merger we know where we are going. And in a better time, when we don’t have a cyclone and we don’t have the floods of the century, we might be able to roll that merger out.

”We know a heck of a lot more now. We’ve got a framework, a fully formed business case, which evaluates the multiple options. We’re much more informed in terms of what New Zealanders want.

“I think it’s been money well spent. We are talking about an industry that had been collapsing on us. There was a huge acknowledgement across the sector that we have to do something. That challenge is still in front of me and I’m trying to get a cohesive strategy.”

He also addressed reports that the establishment board would stay in place until its scheduled end date in June, adding to the costs of the exercise.

He said since the merger was scrapped, the board had met twice at a total cost of $10,300 in board fees. It would wind up after delivering a final report, which he said would be at the end of the month.

The board had met on February 16 and met again – with Jackson – on Monday this week to discuss its wrap-up report.

Cabinet papers state that the daily rate for the board chairwoman Tracey Martin was $1150 and the other eight members $865 each.

It was not expected to meet again until the report was delivered and the board wound up.

National MP Melissa Lee also asked about the ongoing costs of consultants.

The consultants advising the board had been paid $6.5 million since 2019 - $3.87 million of which was with Deloitte, whose contract was terminated at the end of February, as soon as possible after the merger was scrapped. Only three of the other consultants were still at the Ministry of Culture and Heritage working on the final report.

Asked why the board and consultants could not have been wound up sooner, Jackson said nobody had known for certain that the merger was going to be cancelled. “Nobody knew until February 8.”

He said he had been told in December to put the case forward to Cabinet on why the merger should continue in February, as other ministers had been told to do for their projects.

“Prime Minister Jacinda Ardern had made it clear to myself and to other ministers that we had to justify and present a case in terms of where we were at. So when we all left for the Christmas break, I was preparing that case over December and January. So to think everything gets cancelled on February 9th is a bit unrealistic.”

He justified the consultants saying a merger was complex and the Ministry of Culture and Heritage did not have the in-house corporate expertise for it.

He said the next step would be more funding for RNZ - he would not say how much that would be, saying Cabinet was considering a Cabinet paper with recommendations.

He said RNZ had been underfunded for some time – partly because of a funding freeze during the last National Government. The prospect of funding RNZ better rather than the merger had been discussed during the process.

“RNZ will need an immediate injection, but more than that they will need their base funding to be topped up.”