The sorry saga raises a number of questions about the state of local government in New Zealand.
A new business, run by a cake decorator, which had no track record in waste management won a Westland District Council project to build a $7 million sewage plant in Franz Josef, a Stuff investigation has found.
Techno Economic Services, which is based in South Auckland, won the council project in the middle of last year, despite never having provided waste management or construction services before. The company was not a registered company at the time it won the tender. It registered with the Companies Office several months after securing the Franz Josef contract.
Neha Bubna, the sole director and shareholder of the company, runs a cake shop in South Auckland, specialising in birthday and special occasion cakes. She is a recent migrant from India
The process was overseen by Vivek Goel, the council's assets manager who stood down last month as a Serious Fraud Office (SFO) investigation into his activities began. The SFO has declined to discuss the allegations against Goel
Goel was in charge of organising tenders and supervising contracts for council projects such as wastewater treatment
The project was not put out to public tender. It is understood three companies were approached for expressions of interest in the project
Goel's recommendation would have cost each of Franz Josef 's 240 ratepayers over $28,000 each, excluding the costs of running the plant which was estimated at $150,000 a year
The previous council approved the plan as it progressed from stage to stage, despite intense opposition from the tiny Franz Josef community. Before the contract could be finalised, a new council was elected and in November the incoming council, led by Mayor Bruce Smith, rejected the deal
The current council has opted for a plan to build oxidisation ponds at a cost of about $1m
Goel had a history of bankruptcy. Despite this background he was still hired by Council as its Asset and Contracts Manager. The whole sorry saga smacks of corruption similar to the recent corruption case against an Auckland Transport manager. Is it any wonder the Serious Fraud Office has been called in to investigate in Westland, but how could this happen in the first place? Where were the checks and balances? Whose head will roll?
The answer is that there are no longer any checks and balances on local government in New Zealand. Ratepayers find their money going into dodgy Trust Funds, handed out as grants instead of providing essential services, and Council bureaucrats running their own highly political agendas without any care for the purpose of local government.
The government has done nothing to tighten up accountability in local government. Instead it has allowed local government to become a byword for corrupt practices. Changes to the Local Government Act introduced by National have done nothing to stop the slide because the Act lacks any teeth.
Fairfax has done a good job uncovering this nasty story and bringing to the attention of the wider public. Social media, especially through Whaleoil and Kiwiblog, is also playing its part in shining the light on local government rorts. The Auckland Ratepayers’ Alliance acts a watchdog on the waste that is endemic in Auckland Council.
Local government is in serious need of reform if the nation’s decent into corruption is to be reversed.