Ministry of Pacific Peoples blasted for $40,000 farewell by public service watchdog

Leauanae Laulu Mac Leauanae had not been involved in the planning or decision-making for the event.
Leauanae Laulu Mac Leauanae had not been involved in the planning or decision-making for the event. Photo credit: Getty Images / MCH.

The Ministry of Pacific Peoples has been blasted by the public service watchdog for spending nearly $40,000 on farewelling its former chief executive who was moving to another ministry.

The expenditure included $7143.64 on travel and accommodation for 12 guests, $3083 for discretionary expenses like photography, flowers, and ceremonial drummers, and $7555.49 on gifts.

There was "no evidence of an agreed budget" and "limited monitoring or oversight of expenditure", it's said. 

The Public Service Commission, which has been reviewing the spending after it came to light in December, said the former Ministry of Pacific Peoples (MPP) chief executive Leauanae Laulu Mac Leauanae had not been involved in the planning or decision-making for the event. 

"However, as chief executive at the time he was responsible, overall, for agency expenditure," a statement from the commission said. "On being made aware of the money spent on gifts he immediately repaid the $7500 and returned all the gifts."

Public Service Commissioner Peter Hughes said it was "not appropriate" spending. 

"This is a case of one agency getting it wrong," said Hughes.

He said when mistakes are made, he expects public service chief executives to be accountable.

"Mr Leauanae owned his part. When he became aware of the matter, he immediately repaid the money spent on gifts in full and returned all cultural gifts to MPP. He also repaid the money spent on travel for his family and a guest who did not have a formal role in the welcome. That is appropriate and I thank Mr Leauanae for putting the matter right at the first opportunity."

Hughes said he had reminded chief executives of his expectations. Events could be held in a culturally acceptable way while also aligning with guidance on sensitive expenditure, he said.

"It is important to be able to host events in a manner that is culturally appropriate, and there are well established rules and policies to support that," said Hughes.

"New Zealanders expect their tax dollars to be used responsibly and appropriately."

Pacific Peoples Minister Barbara Edmonds, who took on the portfolio earlier this year, said it was "disappointing this has happened".

"Like all Ministers, I expect agencies to spend taxpayer dollars prudently. They were not met on this occasion," she said.

"Since becoming the Minister for Pacific Peoples, I have made my expectations around financial controls and practices clear.

"Senior Leadership at the Ministry has since changed and I have confidence in the new Chief Executive to ensure this doesn’t happen again."

The new Secretary for Pacific Peoples Gerardine Clifford-Lidstone told Newshub in a statement that decisions on "sensitive expenditure are now scrutinised and documented", with clear budgets set out before spending decisions are made. 

"This will ensure that something like this does not happen again. MPP's financial controls, practices and conventions now better reflect the prudent use of public money." 

A report released by the Public Service Commission on Wednesday said the MPP in December provided it with a response to an Official Information Act request about the costs of a fono - meeting - and a farewell event.

After receiving information showing the events had estimated costs of $86,000 and $46,000 respectively - this was later revised down to $72,157.01 and $39,262.22 - the commission decided to undertake a review. This was expanded in June to include expenditure on a welcome event for Leauanae when he became the head of the Ministry of Culture and Heritage (MCH).

The report said MPP held an all-staff meeting (fono) in Wellington on October 13 and 14 last year, with staff attending from the ministry's Auckland and Christchurch offices. The purpose was to reconnect their team and discuss priorities and future plans.

While this was being planned, it was announced that Leauanae had been appointed Secretary for Culture and Heritage at MCH from October 17.

A decision was made to align his farewell with the fono given most MPP staff would be in Wellington. 

It was held in the afternoon and evening of October 13, with community members and public servants present for one part and just staff for a second part. About 213 people attended overall, including 100 staff and 113 others.

The review considered the spending against a range of criteria, including whether it was for a justifiable business purpose, whether it was moderate and conservative, and whether it was done transparently and with proper authority. It was also looked at in the context of MPP's policies and external advice on cultural considerations. 

It found that the spending on the fono was consistent with MPP's policies as it had a clear business purpose, was the first all-staff fono in two years, and was intended to replace any future in-person business group planning days for the rest of 2022.

While the farewell had a justifiable business purpose, the report said the nearly $40,000 bill "was not moderate or conservative".

The report said the MPP leadership team considered the farewell a "community event" and Pacifica community leaders from Pacific nations represented by the ministry were invited. This included 12 guests whose travel and accommodation were provided at a cost of $7143.64.

"The cost of the farewell included $3083.00 for discretionary expenses such as photography, flowers, and ceremonial drummers. It also included $7555.49 spent on gifts to the outgoing Secretary. Upon being made aware of the expenditure, the outgoing Secretary returned all gifts and reimbursed MPP the $7555.49 spent on gifts."

It makes clear that Leauanae wasn't involved in the event's planning or decision-making and was on annual leave immediately prior to the farewell.

"However, as Secretary and Chief Executive of MPP at the time of the farewell, they still had overall accountability for spending decisions and for the content of, and adherence to, MPP policies."

It said the expenditure had "inadequate oversight" and wasn't consistent with MPP policies or the Public Service Commission's model standard on chief executive gifts, benefits and expenses.

"MPP's Hospitality, Gifts and Entertainment Policy did not provide sufficient guidance to staff on cultural gifting, including gifts to departing staff. There was no criteria or framework in the policy for the reimbursement of gifts for staff. 

"The review found no evidence of an agreed budget for the farewell, and limited monitoring or oversight of expenditure. An example of this was catering for the event based on the number of expected guests rather than the number of guests who had accepted the invitation, resulting in significant over-catering and unnecessary cost."

The watchdog said an event budget that was moderate, conservative and actively overseen would have provided clear boundaries.

"The limited oversight of expenditure and the decision to hold the farewell in two parts contributed to the overall cost," the report said.

"Independent advice to the review was that farewells can be held in culturally acceptable ways that still align with the guidance on sensitive expenditure and that the public would see as appropriate."

The review also looked at the welcome event for Leauanae as the new Secretary for Culture and Heritage on October 17. This was organised by MCH with input from MPP. About 150 people attended, including three ministers who aren't named in the report.

The MCH spent $7558.70 and was responsible for the programme, venue, catering, cultural considerations, guest numbers, and invitations. The report said it was a justifiable business purpose and was moderate and conservative.

However, MPP's spending of $4919.47 on this event wasn't consistent with its policies and wasn't recognised as sensitive expenditure, according to the report. It had responsibility for its own guests, including the family and guests of the incoming Secretary.

"There was no upfront discussion on the approach to funding travel or accommodation for guests and no budget was set. "

Leauanae, who was consulted on this guest list, said his family were there was "tapua'i", meaning to be witnesses or supporters. 

"A Samoan proverb states "E le sili le ta'i, na i lo le tapua'i" which means, the supporters or witnesses are just as important as the person being honoured or achieving success. In the pōwhiri setting, family and guests are just as important as the individual being welcomed."

He said he was conscious of "not being overly involved or perceived to be coordinating his own welcome" and intended to pay for his family and personal guests' travel.

"However, during the process of coordinating the welcome event he understood that MPP signalled it would cover these costs. He did not question this and acknowledges he should have done so. He has since reimbursed MPP $4115.38 for the cost of flights of all family members and guests."

The report also took issue with who signed off on some of the expenditure.

In a statement, Secretary for Pacific Peoples Gerardine Clifford-Lidstone said she accepted the expenditure on the farewell didn't comply with internal policies and other guidelines.

"This must be remedied with urgency. I have reviewed MPP's policies and guidance on sensitive expenditure to ensure they are robust and reflect the Public Service Commission's standards and guidance, as well as the Office of the Auditor-General's guidance on sensitive expenditure. 

"Important decisions about sensitive expenditure are now scrutinised and documented, and clear budgets set before any spending decisions are made. 

"This will ensure that something like this does not happen again. MPP's financial controls, practices and conventions now better reflect the prudent use of public money." 

ACT Party leader David Seymour said the ministry would be gone if it was in power.

"Pacific communities in New Zealand have thriving cultures, and are more than capable of sustaining their cultures and languages without a dedicated Government Ministry. 

"The Ministry is unable to point to any achievements other than successfully spending its $30.6 million budget. Under ACT, the Ministry for Pacific Peoples would be gone."