Monday, September 9, 2013

Everyone involved must be prosecuted in transport corruption case

Posted on September 9, 2013 by mintoformayor in Press Releases

The sacking of a senior manager at Auckland Transport yesterday for alleged corruption in administration of roading contracts means prosecutions must follow.

“If there is enough evidence to sack this manager then prosecutions must be brought against everyone involved – not just the manager but the suppliers/contractors at the other end as well.”

Fraud cases in the private sector often end with the sacking of staff involved because private companies don’t want the cost and distraction of on-going legal action. This must not be the case here despite Auckland Transport being based on private sector structures.

“With the Serious Fraud Office involved the sums are likely to be in the hundreds of thousands.”
“This is public money and we must demand full accountability and transparency.”

Two additional issues are raised by this issue.

Firstly Auckland Transport is a CCO (Council Controlled Organisation) which spends hundreds of millions of Auckland ratepayer money without the democratic oversight or input from the council. This ACT Party model, established by Rodney Hide, is much more likely to result in corruption and must be changed.

Secondly the contracting model used by Auckland Transport and other CCOs to carry out their work is wide open to abuse and corruption. Studies in the United States by POGO (the Programme on Government Oversight) estimate the cost of doing work using this model can be more than double the cost of employing people directly.

Auckland Council must get to the bottom of this latest corruption allegation and then investigate the cost-effectiveness of “contracting out”.

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