Kaipara District Council faces new Auditor-General inquiry into spending
Kaipara District Council is facing Audit Office investigation into its procurement. Photo / Susan Botting
New Zealand’s Auditor-General is investigating Kaipara District Council after weaknesses were found in its procurement processes.
The independent public spending watchdog’s latest probe examines the KDC’s procurement, contract management and governance practices.
The Audit Office scrutinises public spending to provide independent assurance to Parliament and the public about how resources funded by rates and taxes are used.
Kaipara Mayor Jonathan Larsen said he welcomed the review.
“We are always looking to improve processes and welcome the review and look forward to any findings.”
Larsen said Kaipara ratepayers could have full faith in their council despite the second investigation.
He said he had no concerns about the council’s functioning.
The Audit Office reviewed the council’s 2024/2025 financials, which identified weaknesses in procurement — the process used to plan, purchase and manage contracts for goods, services and infrastructure to ensure public money is spent fairly and delivers value for money.
The watchdog announced the terms of reference for its 2026 investigation on May 20.
It is now gathering and assessing information and will not comment publicly while the inquiry is underway.
“The annual audit has highlighted weaknesses in the council’s approach to procurement. In recent years, we have also received information raising questions about the council’s spending decisions, including questions about the council’s procurement processes and how it identifies and manages potential conflicts of interest relating to roading contracts,” it said.
“All public spending must be able to withstand scrutiny. The principles that apply to all use of public funds include accountability, openness, value for money, lawfulness, fairness and integrity,” the office said in the terms of reference.
The inquiry will will examine a sample of roading contracts, including how decisions are made and documented, how emergency procurement is controlled, how conflicts of interest are managed, and whether governance oversight is sufficient.
The office said roading was KDC’s largest spend, worth about $36 million in 2024/25.
A significant portion of this budget had been spent on emergency works after Cyclone Gabrielle in 2023 and the Mangawhai rainfall event.
“Supporting integrity in emergency procurement is an area of interest to our office because of the pressure that emergencies can place on governance and process.”
The inquiry may broaden its scope to include other areas of governance, procurement and contract management if the Audit Office deems it necessary.
Kaipara’s ouncil was also investigated during a 20-month Auditor-General inquiry, with a 2013 report on major cost overruns in Mangawhai’s community wastewater scheme covering its management from 1996 to 2012.
Then Auditor-General Lyn Provost’s investigation led to a seven-year Government intervention in KDC – New Zealand’s longest under the local government framework set by the Local Government Act 2002.
The new probe comes seven years after that intervention ended in 2019.
The latest investigation is narrower than the Mangawhai probe.
The Minister of Local Government appointed commissioners to run KDC for three years from 2012, then New Zealand’s longest term until surpassed by four months at Tauranga City Council in 2024.
A Crown Manager was appointed to the council for two years from 2017, followed by two years of residual Government oversight until 2019.
Auditor-General Provost’s 423-page report on KDC’s Mangawhai situation was presented to Parliament in December 2013.
■ LDR is local body journalism co-funded by RNZ and NZ On Air.