Further breakdown of Mudtopia Festival costs revealed

Rotorua's Mudtopia festival has come under fire since it was put on in December 2017. Photo/Supplied

More than $2500 worth of wet wipes, $46,000 of social media advertising and $15,000 spent on accommodating, feeding and entertaining a South Korean delegation has been revealed in a thorough breakdown of the cost of Mudtopia.

In July the final cost of the festival was revealed to be $1.6 million made up of festival management ($519,251), capital expenses ($166,403) and other expenses ($996,160).

A detailed cost breakdown has now been released following a Local Government Official Information and Meetings Act request by the Rotorua Daily Post.

The Rotorua District Residents and Ratepayers group said in a statement at the weekend it had asked the Auditor General for an inquiry into the Rotorua Lakes Council-run event.

Event Engine Ltd was engaged as the festival director to deliver and manage the event costing $397,996.

The new data shows the company was paid a further $75,970 for "expenses".

The company has been deregistered but was previously operated by Simon Brady and Scott Rice.

Brady told the Rotorua Daily Post the $397,996 fee covered the entire festival management team; marketing, PR, music promotion, stage management, sponsorship and more, over almost 18 months.

He said expenses incurred in the planning and delivery of the festival were also passed on to the council.

"For example travel costs, contribution to office expenses, the purchase of web domains, sustenance for crew and volunteers during the event set-up."

Brady said, in his opinion, several things contributed to the financial position of Mudtopia.

"All events carry a degree of risk and when you have a new event concept, the risk is heightened. Not to mention, the set-up costs in year one are an investment for the future.

"To a certain degree, ticket sales suffered from the challenges around communicating such a unique and new event proposition."

He said media attention in relation to the purchase of mud from South Korea also had a negative impact, as had a busy events calendar.

"Mudtopia is definitely not the only event to suffer from the impact of the jam-packed summer."

The Mudtopia Festival cost $1.6m to put on. Photo/File

In the cost breakdown 58 entries totalling $4709.78 were recorded as "RDC Bank of New Zealand (Purchasing Card)". The entries fell under the travel, advertising and marketing, materials and services and other categories.

The council said these represented "minor items purchased with a council purchasing card".

The price of these items ranged from $3.91 to $421.74.

At least $15,800 was spent on the Boryeong delegation from South Korea. It included accommodation, meals, transport - including a $4510 flight for the mayor of Boryeong - visits to Te Puia, the Polynesian spa and interpretation services.

In a written statement drawn from multiple sources and staff, the council said the cost to host the delegation came from the event budget and was part of a "reciprocal agreement with council in exchange for intellectual property, advice and support and promotion of Mudtopia at the Boryeong Festival".

The statement said 14 of the 16 member delegation paid for their own travel costs and accommodation was sponsored.

In addition, three entries adding to $770 were classed as flights for an advisory board member to Christchurch.

A further three entries totalling $1605 were classed as reimbursement of transport expenses and travel costs for the advisory board which had been appointed to provide governance oversight of the event. There were eight board members.

The council statement said one of the advisory board members was from Christchurch and the council covered the cost of some but not all of her travels to and from Rotorua to attend board meetings.

A further $1574.20 spent on "board fees and travel" was for an Auckland-based advisory board member who attended the meeting but later withdrew due to other commitments.
The breakdown also revealed that while Event Engine hired Endeavour Live Ltd to operate social media for the event, and Shine Public Relations to do the PR, the council also paid Applause Communications $25,000 to do PR and communications.

Endeavour Live Ltd was paid $48,820 for social media advertising by the council.
The council statement said Shine PR had been engaged to do the public relations and communications but withdrew in March 2017 and was replaced by Applause Communications.

The Rotorua District Residents and Ratepayers group said in a press release it had asked the Auditor General to investigate what it believed was "significant financial, accountability and governance flaws in the management of public funds" relating to Mudtopia.

Secretary Dr Reynold Macpherson said the group had reached the limit of its resources and the willingness of council to provide answers, without charging the group.The group's chairwoman, Glenys Searancke, said the group's "deep concern" was justified.

"Many of the contracts entered into are with companies not in Rotorua which makes the extravagant spending even more questionable when local businesses were bypassed."