Trustees quit after inappropriate use of $340,000

Two senior officials of the Southland District Health Board have resigned after the trust they ran was found to have inappropriately used $340,000 meant for needy Invercargill children.

The resignations of board member Maria Pera and the board's Maori health general manager, Dion Williams - two of the three trustees of the Murihiku Iwi Whanau Services Trust - follow the announcement of a $110,000 settlement between the board and the trust.

The third trustee was Sonia Bragg, Ms Pera's sister and Mr Williams' mother-in-law.

A report to Thursday's board meeting outlines how the three trustees used $340,000 from another trust they ran - Invercargill Family Start Trust - to pay themselves "excessive" fees and to buy and sell cars for personal use.

They had a three-year $3.6 million contract to provide Family Start services to needy families in Invercargill. The contract was terminated in March at the same time as an audit of the trust.

Board interim chief executive Dr Nigel Murray said yesterday that although the money was used inappropriately, there were no instances of fraud, theft or misappropriation involved.

The assets of both trusts had been transferred to a new one overseeing the Invercargill Family Start programme.

The three trustees had also made personal contributions of $15,500 each towards the $110,000 settlement.

Dr Murray said he was satisfied that Murihiku Iwi Whanau Services Trust and the individual trustees had been held accountable through the settlement reached.

Mr Williams' employment at the board was terminated in June but, as a part of the settlement, the two parties had agreed to withdraw the dismissal upon receipt of Mr Williams' resignation, Dr Murray said yesterday.

In May, the three trust members said they had nothing to hide after being accused of dishonesty.

In a statement yesterday, Ms Pera said her position as a member of the board was no longer tenable.

She was delighted the mediated agreement had found no instances of fraud, dishonesty or misappropriation, but tendered her resignation "because of the long and arduous process of resolving the issues and strained relationships".

- OTAGO DAILY TIMES