The $5million mystery

by Lindsay Shelton
When I reported last week that a city council organisation had received a $5million management fee from the council, there was an angry denial from the organisation’s chairman. Which was strange, as the information came from his annual report. The mystery continues.

The organisation is Positively Wellington Venues, set up by the city council two years ago to handle bookings for the Town Hall, the Michael Fowler Centre, The St James, the Opera House, and the TSB Arena. The work had previously been done by council staff.

When I wrote about the new organisation, I was focusing on the salary of $260,000 paid to its chief executive Glenys Coughlan. Its annual report showed that when the council was doing the same work in house, a salary of $100,000 had been paid to the person in charged. The salary increase seemed extraordinary.

Positively Wellington Venues chairman Chris Parkin was defensive about the salary. She is “worth every penny of it,” he thundered in a comment that he sent to Wellington.Scoop. He also defended the fact that the chief executive has a family connection with Councillor Jo Coughlan, who’s on the board of the new organisation that had employed her.

For the record, Glenys Coughlan was married to Jo Coughlan’s cousin over 20 years ago. The only connection between them is that they both share a passion for improving Wellington.

But most of Chris Parkin’s anger was focused on denying that the new organisation received any fee from the city council, though such a fee was printed in his annual report.

The Council does not pay $5.1 million to Wellington Venues, it pays nothing. (Perhaps you are confusing us with the Museums Trust or the Zoo?)

Chris Parkin sent a second comment later the same day:

It may be a Council report, but certainly not from wellington venues. Suggest you quiz the Council’s CFO. I can assure you it is not a subsidy to Wellington Venues.

I was a bit slow to follow-up his suggestion. So I’m grateful to Wellington.Scoop reader Michael Gibson for doing the follow-up:

I have asked the Council CFO Peter Garty about the $5,444.776 Management Fee and here is his response:

“This is correct and represents the management fee paid by Wellington Venues Project (part of WCC) to Wellington Venues Limited so it appears as revenue in the Wellington Venues Limited accounts. The Chairman of the board would have seen these financial statements as they are signed off by him. The auditors, Audit New Zealand, have also signed off the accounts as part of the audit opinion.”

So now we have confirmation from the city council’s chief financial officer that a management fee of $5.4million was paid to Positively Wellington Venues, and reported in financial statements signed off by Chris Parkin.

But we still have a denial from Chris Parkin that any such fee exists.

Who’s right?

The next move seems to be up to Chris Parkin. Or his well-remunerated chief executive.

 

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