Reality check

Written By: - Date published: 10:13 am, May 28th, 2008 - 29 comments
Categories: housing - Tags:

Housing NZ’s decision to hold a conference for 94 staff at the luxury Tongariro Resort raises serious issues about extravagance in the public service. My first instinct, like others, was to assume the worst and condemn the Ministry for its extravagance with public money.

Clearly $65,000 for a 90-person conference sure sounds like a lot of money, even if it includes $12,000 in travel costs and another $5,000 in extras. Per person accomodation and food worked out at $250 a night – a figure that on the face of it seems hard to justify.

So I decided to do a bit research. You see, I’ve got a friend who as part of her job books conferences for a large organisation. Last year she was tasked with booking a two-day conference for a similar number of people. She was under strict orders to keep costs to a minimum, so she chose a budget venue in the central North Island in order to minimise transport costs, booked people into shared accomodation and made sure all extra costs were kept to a minimum.

The cost? $40,000 for two days, or $222 per night for each person. That’s just $28 per person less than Housing NZ’s discount deal at the Tongariro Resort. Once she’d added the cost of transport and extras the price was upwards of $60,000.

Now I’m not going to argue that having public servants staying at a luxury resort is a good look when there are people on waiting lists to get into state houses and existing tenants wait weeks to get basic service, but if the Herald’s figures are anything to go by it seems Housing NZ genuinely got itself a bargain.

The real question here is this: political perceptions aside, is there anything fundamentally wrong about a public sector organisation giving its staff better accomodation for the same price as a budget venue?

29 comments on “Reality check”

  1. milo 1

    I see nothing wrong with this at all. Unfortunately, the media like to make scandals out of travel, conferences and ‘payouts’. But many are in fact justified, and this one certainly is.

  2. Ironically, National’s Phil Heatley, who brought the issue up, had just appeared at a $1400 a ticket one day conference. Not a waste of money, apparently.

    National conferences are expensive (travel, accomdation, conference venue, food etc), that’s life. Seems to me, they got a pretty good deal.

    Disappointing the media went sensationalist on this immediately, rather than doing some research, like Tane has done.

  3. Hell, it was $110 for an analyst just to attend the Budget lockup (fortunately, I counted as media, so it was free 😉 )

  4. insider 4

    As soon as I saw it I thought it looked cheap.

    But remember Labour made an awful meal of a very similar WINZ conference in the 90s. So what goes around comes around.

  5. mike 5

    Perception is key for a dept like Housing NZ and it’s a very bad look. 3rd termitis strikes again

  6. erikter 6

    Steve Pierson, could you please explain the difference between this conference and a similar event sponsored by WINZ years ago, when Labour was opposition?

    Yes, the same conference that caused Steve Maharey to complain bitterly about a culture of excess and extravagance in that organisation.

    I look forward to your thorough explanation.

  7. Yep,the price per head seems reasonable. What was the conference about ? The real question is: was the conference necessary or could the same result have been achieved without a conference ?

  8. Tane 8

    erikter, this site isn’t responsible for what Labour MPs say, let alone what they said ten years ago.

    As I understand it though Rankin’s WINZ conference was genuinely extravagant and included the department paying $165,000 on charter flights, $65,000 of which went missing.

  9. Bryan. If we’re going to have a public debate on the worthwhileness of spending $250 a person every time a public service does something, nothing will ever get done.

    But like I always say, it’s not in politican’s interest to allow waste in their departments that could be spent productively or on tax cuts, nor is in a department head’s interest to waste money that could be used on better results, and none of them want embarrassing media stories.

    That WINZ conference in 1999 was about $2000 a head, and, like Tane said, the big deal was that money went missing.

    captcha: conference 28 -scary.

  10. Snelly Boy 10

    Such ‘stories’ are never going to be a good look for a govt agency and the govt of the time regardless of the cost effectiveness or benefits of the get together. It’s a no win situation.

    This is for the expenditure is seen as being that of ‘our money’.

    This sentiment is understandable for the majority of the public who will never ever get the opportiunity of engaging in such perceived larging it up. One’s own hardship, jealousy or simply innonence of how the business world at large really operates behind public facades drives this resentment.

    What annoys me on these occasions though is the outrage expressed by the right wingers when so many of that ilk will regularly have their snouts in the trough of corporate waste.

    They will argue strenuously that’s different for it’s ones own money to do with what one wants but who ultimately pays for the waste though?

    The consumer and shareholders that’s who.

    If the public (and shareholders) truly knew of the extent of money and time pissed away in the name of entertainment and networking and on what, their attitudes to both coporate and govt expenditure would alter.

    And yes, I do speak from experience.

  11. erikter wrote:

    “Steve Pierson, could you please explain the difference between this conference and a similar event sponsored by WINZ years ago, when Labour was opposition?”

    About 1510 dollars per person and a chartered aeroplane…

  12. andy 12

    yeah, whats 65k when your going to retro fit all state houses with insulation at our expense.

    I can say as a neighbor of many state houses I am glad that all those people will have toasty feet while I am left to struggle with my $16 a week tax cut, which BTW will not cover my increased costs for water, gas, petrol, food, electricity, car rego and the cold….

    Sell the houses and build better more efficient housing and get harder on long term tenants. Plenty are just sitting in houses to big or they have ‘got ahead’ in a manner that state housing is designed for, but are never reassessed and moved on.

    3 houses border on my property all occupants in the homes for over 15 years, all working age and working, why the need for a state house again.

  13. Tane 13

    I can say as a neighbor of many state houses I am glad that all those people will have toasty feet while I am left to struggle with my $16 a week tax cut

    Yeah andy, those state house tenants have it pretty sweet, eh. Man, what I’d give to throw in my comfortable salary, clean toilets 16 hours a day and rely on the whims of Housing NZ to keep a roof over my family’s head.

  14. National disgrace 14

    Housing NZ staff conferencing in a luxury lodge while tenants huddle in state houses? Disgraceful. I hope under National, corrections ministers and staff would meet in disused jails. The one just south of National Park looks suitable, and real cheap.

  15. andy 15

    Tane,

    You have no idea what I do! I never said they had it sweet, but it is pretty sweet if your landlord retro fits your house with insulation and does not increase the rent?

    I rent my house, I work hard, have no kids but feel I get penalised at every turn for my CHOICES!

    tell me again why a solo mum (working) with two adult kids both working and living at home need a state house? That is only one of 12 in my street, all long term tenants. The idea of a state house is good but plenty don’t need them.

    Hand up is fine, but it should not be a long term proposition for most.

  16. illuminatedtiger 16

    You have a problem with poor kids getting warm houses? Should insulation only be for the rich?

  17. Draco TB 17

    Andy:
    Have you written to the minister about your concerns? Have you written to HNZ?

    People rorting the system is everyones concern but coming on here and complaining about these things won’t get anything done.

    Also, there is help that may be available to you to insulate your house.

  18. Matthew Pilott 18

    Andy,

    I am sorry that you are jealous because the state chooses to be a good landlord.

    You’re also berating Tane for making assumptions about your work, while doing exactly the same for state housing tenants on your street. If it riles you so much, have you looked into the criteria for state housing? Can you be sure you know every detail of your neighbours and whether they meet the criteria (if yes, then you’re probably a stalker)? Do you know the process behind moving out of a state house?

    The irony of your approach being that everyone else is talking about poor State Housing tenants, and how that money could have been spent paying poor Dot’s rent for seven years.

    Yet hearing from you, they’re the lucky ones.

    Who’s a guy to believe – annoyed blogger or lazy MSM?!?

  19. andy 19

    You have a problem with poor kids getting warm houses?

    tell me again why a solo mum (working) with two adult kids both working and living at home need a state house? including insulation?

    Poor Kids is fine, better health out comes and all that, yep fine no argument.

    Structurally HNZ is broken, 8,000 on waiting list and they are not managing tenants effectively, they coudn’t even evict the Salt family in Mt Albert.

    http://www.nzherald.co.nz/section/1/story.cfm?c_id=1&objectid=10510630

    The Solo mum next to me has been in the house for over 15 years, both kids university educated, one a lawyer one works for winz. The time has come for some other family to get a shot, know we are subsidising these people needlessly.

    Should insulation only be for the rich?

    what is rich in your mind? Would that be one dollar more than the maximum allowable to get into a state house? Should those working poor not in a HNZ house miss out too as they face similar problems, may even be on waiting lists for a house.

  20. andy 20

    Draco,

    they are not rorting system, the system has forgotten them.

    Matthew,

    I am not jealous, annoyed yes. The benefits to NZ as a whole from state housing have become spotty at best. Dot is in a special case as her house maintenance will be put off as those properties on Kupe st are subject to a treaty claim.

    Stalker, ha thats funny. Have lived next door to them for some time, what i am getting at is that they should be in a private rental (with help from winz if needed) and the house with nice garden etc would be better in the hands of a young family in need.

    Also the residential tenancy act covers state houses so the process on moving out is simple, quick call on the 0800 number.

  21. Matthew Pilott 21

    Sorry Andy, you had me worried, knowing so much about your neighbours. Well that’s better than not knowing their names, like most people.

    It’s hard to tell if the situation you describe is representative of NZ State Housing in general – although given the long wait list and the number of long term tenants perhaps this isn’t too isolated a situation.

    This being the case, perhaps the needs of tenants should be more closely monitored – moving a tenant out of state housing would have a very big impact upon them though, and it must be done carefully; I can see why it would be a difficult thing with which to strike a balance.

    Reference to Dot was a general reference to the media’s interpretation of State Housing tenants – that they are dependant on help, and the money spent on the conference could be better spent upon them. Which is a vastly different story to the picture you paint of relatively well-off tenants getting state assistance well beyond requirements.

  22. Draco TB 22

    they are not rorting system, the system has forgotten them.

    Then remind the system by writing letters to the appropriate people.

  23. Stalker, ha thats funny. Have lived next door to them for some time, what i am getting at is that they should be in a private rental (with help from winz if needed) and the house with nice garden etc would be better in the hands of a young family in need.

    I live in a cul de sac with several HNZ properties. I’m very grateful for the fact that a period of tenancy turnover seems to have stabilised. I’m a big supporter of pubic housing, but I signed a collective letter asking HNZ to evict one new tenant (mentally ill, dangerous friends) and a similar eviction took place a few houses down, after some scary behaviour. We’re back to tenants we can happily regard as neighbours.

    You should be careful what you wish for …

  24. Structurally HNZ is broken, 8,000 on waiting list and they are not managing tenants effectively, they coudn’t even evict the Salt family in Mt Albert.

    They manage 200,000 properties. In that context an 8000 waiting list doesn’t seem quite such an issue.

    And how on earth is it HNZ’s fault that the Tenancy Tribunal ruled against its bid to evict the Salt family?

  25. middleground 25

    Please don’t mistaken HNZC with DBH, where Housing New Zealand ‘Corporation’ is a Crown Entity and Department of Building and Housing can be alternatively specified as a ‘Ministry’.

    HNZC provides state housing services for those in need.
    DBH provide information and guidance on building law and compliance, services including weathertight homes, and advice for tenants and landlords.

    So in response to: “Housing NZ’s decision to hold a conference for 94 staff at the luxury Tongariro Resort raises serious issues about extravagance in the public service. My first instinct, like others, was to assume the worst and condemn the Ministry for its extravagance with public money”
    – HZNC employees are not public servants. HZNC is also NOT a ministry

    If you need further insight to the difference between Public Service departments and Crown Entities, visit SSC’s data sheet here http://www.ssc.govt.nz/display/document.asp?docid=2815&pageno=4

  26. andy 26

    You should be careful what you wish for

    Too true. Have regular police presence at state house over the road too 🙁

    They manage 200,000 properties

    I was under the impression that it was 68,000ish, 200k sounds alot?

    Draco

    See my previous link about the Salt family upthread, people have tried.

  27. Vanilla Eis 27

    Sorry Russell, andy is right. HNZC manage around 68k properties, but house 200k people. But by the same token, the 8000 waiting list is likely people waiting, not number of properties needed.

    middleground is also correct – HNZC =! DBH.

    Additionally, the Tenancy Tribunal falls under the Department of Building and Housing, and HNZC are still bound by the Residential Tenancies Act when it comes to terminating a tenancy. They have some exceptions under crown law, but mostly they have to provide reasonable proof – normally accepted as 21 days of arrears, breach of a ten-day notice or breach of contract. If none of these conditions apply, then the Tenancy Tribunal will not terminate a tenancy in the landlords favour.

    Following on, andy, HNZC tenancy contracts will stipulate that if your income increases beyond the threshold then you start paying market rates for the property. I haven’t worked for HNZC, but during my time at DBH I got to know the RTA a little. Merely increasing your income beyond the threshold is not legal grounds for an eviction.

    edit: corrected the number of properties. andy was spot on, as far as the 2006-2007 year goes. check the HNZC annual report for more details:
    http://www.hnzc.govt.nz/hnzc/web/about-us/annual-report/annual-report_home.htm

  28. Ted 28

    “Housing boss may be punished over conference

    28/05/2008 16:28:18

    Housing New Zealand’s chief executive looks set to be punished for spending $65,000 on a two-day conference.

    Ninety four staff member spent two days at the Tongariro Lodge earlier this month in an effort to improve the way the staff provide service to state house tenants.

    Housing New Zealand’s chairman agrees the venue was inappropriate, and is planning to review the performance payment to chief executive Lesley McTurk.

    State Services Minister David Parker says the improper use of funds are taken into account when heads of Government departments have their pay reviewed.

    Housing Minister Maryan Street has spoken out in support of the conference, saying it allowed staff to improve the service they offer to state house tenants.

    But the Prime Minister says the Tongariro Lodge is the wrong venue for a conference of that kind. She says while any organisation, be it a parliamentary caucus or a Government department, will get staff together, you have to be very careful about choosing the venue.

    Miss Clark says she advised Ms Street not to try to defend the conference. She says Ms Street is a relatively new minister, who was trying to say that some good would come out of the conference”

    From NewstalkZB. Evidently it’s not just the Nats who have a problem with it. I wonder if the review will also take the HNZC getaway at the Hotel and Spa du Vin in to account.

  29. pohutukawa kid 29

    In a long career in both the private and public sectors I’ve forgotten how many courses, conferences, and other versions of groupthink activities I went to both in NZ and overseas. They’re a fact of working life and nothing to get excited about.

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