Get up, stand up

This weekend is the Annual General Meeting of Te Runanga o Ngati Awa and I want to encourage you all to go.

It is our only chance to hear first-hand what TRONA has to say and be able to ask our own questions. Well at least this is what I’ve been taught to believe.

Last year’s meeting was my first TRONA AGM.

I went with a group from Wairaka determined to ask questions. We knew answers would be limited and, at some stage, we would be label radicals, activists, haters, wreckers, negative or nuances. But here’s the thing, we knew we had to go and do what we did.

We had all heard the stories about failing internet companies, luxury golf courses up north only that had crumbled at the first hurdles, castles being built in the name of men and a dysfunctional culture.

Some of our questions were answered, many were not.

It was this event that inspired this blog.

And as I look over the past 12 months I realise nothing much has really changed. I don’t expect to get too many answers out of this weekend and people are still labelling this blog as a part of a group of “negative nuances”.

But ten new faces on the TRONA board is a sign of what can be done by the people and I urge you to stand up and demand a change.

As always I begin with the warning that this is the information that I have collected, take from it what you will and make your own decisions about it. But always remember you can always go to this year’s AGM at Wairaka on Sunday if you want to ask our management and governors for yourself.

This week I picked up a TRONA annual report. After attending most of the board meetings this year I wasn’t expecting the bottom to have fallen out, but I still wanted to take a read before this weekend and on the first look things seemed good.

The document is sleek-looking with glossy pages and sharp images. It pumps up the Runanga and notches achievements from the past year including cutting costs “to bring the Runanga back into near positive cash neutral” and the restructuring of Development Ngati Awa.

But upon reading it again there are some glaring mistakes and concerning themes.

However rather than concentrating on spelling errors and minor details I wanted to start this post by reminding you of Jim Davies and the $3.8 million contract with the CO2 New Zealand Management company.

Mr Davies is a good, honest man who has worked in the area of forestry and farming for more than four decades. Up until July he was the chairman of the Ngati Awa Farm Committee.

However he was forced to resign after he received a letter from runanga chief executive Enid Ratahi-Pryor explaining the financial arm, Ngati Awa Group Holdings Ltd, had voted to remove him because he spoke to the media about concerns around the tribe’s carbon credit investment.

Since then NAGHL chairman Wira Gardiner has made himself Ngati Awa Farm committee chairman and Wilhelm Studer has been selected for the remaining spot.

And perhaps you agree that Mr Davies shouldn’t have spoken to the media but his forced resignation was quick, so quick he that he did not have time to give his last report.
But I wanted to share what Mr Davies had written in his report.

In it he said the report’s purpose was to state the “Farm Committee’s” position on the “CO2 Ngati Awa Farm Land Management Agreement”.

“Subsequent investigation by the Farm Committee revealed that a conflict in fact did arise because Graham Pryor was a NAGHL director as well as being General Manager at the Ngati Awa office. He was also an Iwi director at Tukia , plus having a vested interest and directorship at CO2 New Zealand Ltd, an Australian carbon trading company.”

As already outlined in previous posts Graham Pryor is one of five people on the board of Ngati Awa Group Holdings Limited (NAGHL).  The other members are Waaka Vercoe, Joe Mason, Brian Tunui and Sir Gardiner.

“In 2010, Mr Pryor, with NAGHL chairman Wira Gardiner, executed a $3.8 million contract with the CO2 New Zealand Management Company.

At the time Mr Pryor was a director of the CO2 New Zealand Management Company.

Sir Gardiner says Pryor did not become a director of NAGHL until after the contract with CO2 New Zealand Management Company was instigated. However a report from the NAGHL Audit committee says Mr Pryor was the one who received crucial legal advice about the deal before it had been signed on behalf of the tribal company.

Also identified in the audit committee report was that Mr Pryor had failed to disclose the potential conflict of interest and, more seriously, there was no policy to demand it.

Mr Pryor and Sir Gardiner had also executed the contract without prior approval from the rest of the NAGHL board.

At a meeting earlier this year Sir Gardiner said he had required Mr Pryor to resign as a director of the CO2 New Zealand Management Company when he became aware of the potential conflict of interest”.

Mr Pryor did so but he still remains within a stone’s throw of the deal as a director of a company called Tukia Group.

Set up by the six iwi involved in the Central North Island (CNI) forestry settlement, Tukia Group included Ngai Tuhoe, Ngati Tuwharetoa, Ngati Raukawa, Ngati Whare, Ngati Rangitihi and Ngati Whakaue.

In his report Mr Davies says Tukia Group is also tied up with two other companies, CO2 New Zealand Ltd and Carbon Energy.

 “This arrangement effectively places CO2 New Zealand and Carbon Enery in control of the group. In other words, a collection shell companies comprising a mere handful of principals. All names are readily available on the register, with one in particularly featuring throughout.

“CO2 New Zealand was designed to benefit from carbon opportunities that may arise from the Treelords deal, or any other Iwi management opportunities that may occur.”

And then there was also story in this week’s Beacon focussing on Mr Pryor and the Tukia Group.

For details sake the Companies Office lists CO2 New Zealand as having a 45 per cent shareholding in CO2 New Zealand Management Ltd company. The two companies have the same two Australian-based directors, Andrew William Thorold Grant and Harley Ronald Whitcombe but Mr Pryor is not listed as a director.

The story in the Beacon goes on to describe Mr Pryor as being the Tukia Group chairman and says the company continued to trade until June 30 2013, at which time shareholders agreed to cease operations and hand some assets back to the CNI iwi holdings.

It explains the settlement with the six central north Island iwi was worth $418 million and the story explains that Tukia Group was meant to be a joint venture that invested in natural resources. Each tribe advanced $550,000 to develop a geothermal opportunity at Tauhara. It does not mention the CO2 New Zealand Management company or its owner CO2 New Zealand Ltd.

But it does describe the failure of the Tukia Group and concerns from the other Iwi about its performance.

“Tuhoe Te Uru Taumatura chairman Tamati Kruger said Tuhoe advised other directors last year Tuhoe was no longer supportive of Tukia and advocated its early wind up,” the Beacon reports.

The story points to the company’s financial collapse as the reason for the concerns.

“Ngati Rangitihi is recorded as having a paid a further $85,000 according to its annual reports, but it is not clear why.

“Tuwharetoa paid an additional $1.25 million to bail out Tukia in 2011. Today Tukia still exists, but it is hard to determine in what form… Auckland firm Johnstone Associates is Tukia’s accountant but staff member Rupit Kshatriya will not comment on the state of the company, referring the Beacon to chairman Graham Pryor.

“Mr Pryor, also chairman of CNI signatory Te Mana o Ngati Rangitihi Trust, has not responded to questions from the Beacon.”

 A side bar said that according to an annual report that Te Mana o Ngati Rangitihi trust, which is part of the CNI deal and the organisation that Mr Pryor leads, Tukia had sold its 45 per cent in CO2 New Zealand Management Ltd.

Now, let’s not forget Mr Pryor was the man who facilitated the $3.8m deal between NAGHL and the CO2 New Zealand Management company. Described as “re-afforestation project" in the TRONA annual report, the contract was negotiated by Mr Pryor while he was still a director of CO2 New Zealand New Zealand Management and at least involved with the NAGHL board.

The TRONA annual report outlines that an agreement with “CO2 New Zealand Limited Partnership” was entered into on 20 October 2011.

“As part of this agreement along with the subsequent Carbon Sequestration Management services agreement entered into in July 2012 and variation agreement in January 2013, the group committed capital expenditure of establishment fees of $3, 186,177 through to 2017 and ongoing annual mangment fees of $164,749 per year for 2018-2020, $198,835 per year for 2021, $87,360 per year for 2022-2031 and $70,980 per year for 2032-2062.”

In other words, Ngati Awa will pay $6.6m ($6,630,150) to CO2 New Zealand Limited Partnership over the 50-year life of the project.  As at 30 June 2013 a payment of $1,912,527 has been made, despite a memo on 17 October, 2012, from NAGHL and Trona chief executive Mrs Ratahi-Pryor to Sir Gardiner that warned of conflict of interest concerning Mr Pryor.

The memo from Mrs Ratahi-Pryor also said that there was a “get-out-jail” clause because of the conflict of interest that could be enacted before December 2012.

Obviously the TRONA board did not remove Mr Pryor nor was he reprimanded for holding back crucial information at the time of the deal. In fact he was made chairman of the Investments Committee and Mr Vercoe, who wrote the first report to signal concerns in this area, was replaced as Audit Committee chairman by Brian Tunui.

So what I really want to know in this entire murky saga is: What exactly does Ngati Awa get from the $6.6 million contract with CO2 New Zealand Ltd?

Other questions on my mind are also:

- Why did the Runanga decide to write-off $181,000 owed by Ngati Awa Development Trust and $188,000 owed by Ngati Awa Research and Archives?

- Was the decision to pay the members of the new Ngati Awa Development Trust, that now includes members from Te Whare Wananga o Awanuiarangi, Ngati Awa Social and Health Services (NASH), Te Reo Irirangi o Te Manuka Tutahi and Ngat Awa Tertiary Training Organisation, to attend meetings included in the budgets?

- What do amounts do the NAGHL board members receive in fees or honorarium including the chairman and deputy chairman?

- Ngati Awa have committeed to a $6m ($6,281,000) mortgage from ANZ to pay for the Tumurau farm, which was bought last year - have any other partners been found for the 49 per cent, that NAGHL has identified that it does not want to own, apart from Rotoehu Forest Trust and Kiwinui?

- What services do Mataatua Quota ACE Holdings Ltd provide Ngat Awa?

However, do you reckon I will get to ask all of these questions at the AGM? And even if I do, do you reckon I will get any answers?

I don’t hold out much hope, so this weekend I am going determined to get an answer for one question: How is Te Runanga o Ngati Awa going to help with the fight against the proposed marina and protecting Opihi Whanaunga-Kore?

Ma te wa

How many more?

Another head has rolled at Te Runanga o Ngati Awa.

After more than 27 years Jim Davies has ended his tenure with the Ngati Awa Farm committee following a request for him to resign.

Te Runanga o Ngati Awa (TRONA) chief executive Enid Ratahi-Pryor requested Mr Davies resign in a letter dated May 22.

“I am writing to advise you that the board of Ngati Awa Group Holdings Ltd (NAGHL), in its capacity as shareholder of Ngati Awa Farms Limited, has passed a resolution to remove you as a director of Ngati Awa Farms Ltd…

“I have been asked to seek your resignation as a director of Ngati Awa Farms (Rangitaiki) Ltd and as a member of the Board of the NGati Awa Farms (RangiTaiki) Joint venture. It would be much appreciated if you could let me have those resignations by return.”

When asked whether Mr Davies was forced to resign from his post, Mrs Ratahi-Pryor replied: “A resignation is exactly that a resignation.”

She refused to answer why Mr Davies had been asked to resign. However Mr Davies said the request was made following a phone conversation in which he was scolded for his role in a story that had appeared in the Whakatane Beacon.

Mr Davies had provided the Beacon with a copy of an internal document that was written by Mrs Ratahi-Pryor for the NAGHL chairman, Wira Gardiner.

The document outlined an option in the Companies act that would allow NAGHL to request that CO2 New Zealand Management Company to demonstrate fair value for a $3.8 million contract.

“Under that section if a company enters a transaction in which a director is interested, the transaction may be avoided at any time before the expiration of three months after the transaction is disclosed to all the shareholders.”

The document when on to outline the conflict of intereste issue involving NAGHL board member Graham Pryor where he was also a director of CO2 New Zealand Management Company at the time that the deal was instigated.

“Consequently, if Graham Pryor was an interested director at the time and the transaction has not yet been disclosed to the Runanga as the shareholder in (NAGHL), it may be possible to avoid the transaction unless CO2 New Zealand can establish that the company has received fair value,” Mrs Ratahi-Pryor said in the document.

Despite the price of carbon credits dropping from $27 to less than $3, the option was not taken up by NAGHL.

Mr Davies said he felt compelled to make a public stand because of the responsibility he felt to the iwi.

He outlined his concerns in a report that he had hoped to give at the next farm committee meeting to be held on June 4.

In it Mr Davies says the farm committee concerns were taken to a NAGHL meeting on August 16, 2012, however the report was ruled out of order by Mr Gardiner.

The report was then emailed to TRONA chairman Te Kei Merito, who acknowledged receipt of it a week later and gave an assurance it would go back to NAGHL. Mr Davies was set to give his report next week.

However Mr Davies handed in his resignation last week.

“After 27 enjoyable, interesting and rewarding years at Ngati Awa farm, I formally hand in my resignation from the boards of Ngati Awa, Ngakauroa and Tumurau farms as requested," he wrote.

“No doubt this action may take care of some of your immediate problems. However the questions on truth, transparency and accountability in the CO2 Ngati Awa still remain unanswered.”

Now this raises the question of: why was Mr Davies forced to stand down and yet Mr Pryor is still a director on NAGHL and the chairman of the investments committee?

Information is power

Once again I am a little bit late with this post but I wanted to take my time so that my approach is measured and considered.

As you are aware I was meant to talk about the Ngati Hokopu hapu meeting after it was announced  that the chief executive of Te Runanga o Ngati Awa (TRONA) would attend and answer questions.

Enid Ratahi-Pryor had said she would like to attend the meeting to “decipher” and “demystify”    information coming out of the runanga.

However because it was the first meeting of the year it was felt there was too much business to get through so Ngati Hokopu requested Mrs Ratahi-Pryor attend another meeting at a later date.

That meeting is to be held at Wairaka Marae on March 6 at 6pm.

Therefore this week’s post will not be about what was discussed at the Ngati Hokopu hapu meeting; rather I would like to take some time to talk about the TRONA board meeting held at Te Manuka Tutahi last week.

It is the first board meeting that I have attended and I left feeling even more despondent.

I have a number of concerns but today I will highlight one area and that is: Ngati Awa’s financial arm will not be able to give the full annual grant to the runanga this year after heavy losses by its carbon credit investment.

Every year Ngati Awa Group Holdings (NAGHL) gives TRONA $1.5 million to fund the tribal operations.

However the group’s accountant, Murray Haines, told the TRONA board that NAGHL would only be able to give $400,000 from operating cash flows this year.

“An estimated $1.1m of the obligation funding will need to come from reserves due to the Carbon impact.”

Mr Haines said the tribe’s investment in carbon credits had recorded a year-to-date loss of $809,000.

“It is expected that the total for this financial year will be $1.9m. In the review by PriceWaterhouseCoopers it was concluded that an inflation adjusted carbon price of $25 per term was required. The current price is $2.35.”

The investment has already cost the tribe $2.2m in previous years and now the Runanga is considering whether to write the asset off.

“Writing off 100 per cent is the worst-case scenario. When I say write off it means that instead of keeping it as an asset we make it a cost,” Mr Haines said.

The report also highlighted that a net loss of $939,000 is being predicted with an expectation that the return on investments of 1.2 per cent instead of the budgeted 3.5 per cent.

On a positive note Mr Haines was able to say that an agreement with GoNet had been reached where the internet service provider would pay for the shares acquired from the tribe.

Mr Haines had claimed at last year’s AGM that the tribe had sold the shares for nothing but last week he outlined a plan for GoNet directors to pay $300,000 for the shares. The first instalment is due in April.

In addition Mrs Ratahi-Pryor had declared earlier in the meeting that the organisation had achieved a cash-neutral position. In other words the amount of money coming into the organisation was the same as what would be going out for this year.

The board gave Mrs Ratahi-Pryor a round of applause when she announced the achievement however only one member raised concerns about having to take money from the reserves to fund the runanga’s operations when it was outlined by Mr Haines.

When Mr Haines started his financial report four members left the table but as he went along hapu representative Regina O’Brien made it clear that she disapproved of having to take money from the tribe’s reserves.

She said she was deeply concerned that TRONA would have to use money from the reserves for operations.

Her point was noted but board chairman Te Kei Merito decided to move the meeting on and the situation wasn't discussed any further.

Meanwhile during the meeting Mrs Ratahi-Pryor said a reporter from the New Zealand Herald had obtained a copy of an audit report that had been commissioned from the international accounting firm, PriceWaterhouseCoopers .

Mrs Ratahi-Pryor suggested the board pass a motion to embargo the meeting report until the next hui. The board voted and passed a resolution for all of those in the public gallery to hand the meeting report back before they left.

During Mr Haines presentation Mrs Ratahi-Pryor approached me and asked me to return the report immediately. There were four other people in the public gallery but I was the only person approached.

I declined and said I would return the report before I left the meeting.

The move to restrict information deeply concerns me. As an uri of Ngati Awa I believe it is my right to receive information about the runanga and its subsidiaries.

Add to that there is no legal requirement of embargo. It is a request not to publish the information before a certain date, that is all, and in this case the date is two months away at the board next meeting on April 26.

After much consideration I have obviously decided to ignore the request not to publish information from the report and have chosen to share it with you.

My reasons are simple.

In the past three years the runanga have lost $5.2m in failed investments and from what I can tell from attending the board meeting is that we stand to potentially write-off another asset. In addition we are also losing money despite the chief executive’s assertion that the runanga is cash-neutral.

And even though it maybe the hapu representatives’ responsibilities to report back to the people this is too important to leave up to chance that you might attend your own hapu meeting and then hear a fair report of the goings-on at the runanga. The internet has the ability to reach so many more people and I am determined to share whatever information I find out.

What you choose to do with that information is up to you.