Lee’s company may owe $100,000

October 13th, 2009 at 7:04 am by David Farrar

The NZ Herald reports:

Evidence emerged last night of potentially serious breaches of contract between the television production company of National Party list MP and funder which could cost the company at least $100,000 in repayments.

The funding organisation’s chief financial officer, Wayne Verhoeven, sent the MP a letter on June 12 outlining what it considered to be breaches of its funding contract through inflating company profits from the contingency fund.

The contract between Asia Vision Ltd and NZ on Air explicitly prohibits the producer making any changes to the agreed contingency budget or the agreed company markup (production company overhead) without the consent of NZ on Air.

Mr Verhoeven’s letter accuses Ms Lee of using money from the contingency budget to increase the markup from 8 per cent to 10 per cent over five series of Asia Downunder.

The five years of contingencies total $100,126.

Last night, Ms Lee described it as “an innocent error”.

She said she had replied to NZ on Air in June but had not yet had a response.

“I have been waiting for them to let me know the outcome.”

Ms Lee told the Herald she had not been aware that the errors had been happening as the finances were handled by the production manager and accountant.

“At a time when there was no increase in funding, the company reduced its profit margins so it could continue making quality television and prudently maintain a contingency fund,” she said.

“This has come as a total surprise. The company wasn’t aware that the money set aside in the contingency was technically expected to be refunded.

“I’m not deeply involved in the day-to-day accounting, but the company’s moved quickly to rectify the problem and will pay back any money deemed to be outstanding.”

The company had amended processes to ensure such an error could not happen again, she said.

“I’d also urge other production companies to seek advice and make sure they comply.”

This issue is quite separate from the false allegations made against Lee before the by-election, but they are cause for concern in their own right.

Normally I would hold a case like this up as an example of the dangers MPs can have in continuing with business activities as an MP, but this actually predates Melissa’s election to Parliament.

Labour released the NZ on Air letter last night.

It had previously complained about Ms Lee’s company while she was National’s candidate in the Mt Albert byelection. NZ on Air cleared her in May of misleading the agency.

The Labour Party says Broadcasting Minister Jonathan Coleman must have known about the letter.

“Unless he fronts up and tells the public what he knows, he could be accused of a cover-up,” Labour deputy leader Annette King told TV3.

Dr Coleman said he had known about it since August 18.

It is unclear whether or not the company does have to pay back $100,000 or not, as at this stage we do not know their response to the response from Lee.

From a political management point of view, this should have been sorted out within weeks, not months, of the issue being raised.

If I was advising Melissa, I would have counselled her to get a final decision from NZ on Air as soon as possible, to repay immediately any money owing (if that was the final decision), and then to do a media release announcing what has happened. You front-foot the issue, rather than wait for the Opposition to discover it.

Now it is still a bit murky, as we are yet to hear from NZ on Air what their final position is, but it certainly is not a good look even on facts known to date.

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46 Responses to “Lee’s company may owe $100,000”

  1. Viking2 (11,261 comments) says:

    Its takes years for a Govt. organization to make a decision. How could Mellissa get one in days? Oh that’s right, I forgot, the Govt. servants have a new found urgency.NOT.

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  2. village idiot (748 comments) says:

    ‘Innocent mistake’

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  3. Tom Semmens (79 comments) says:

    “Hundred grand? What hundred grand?? OH! THAT hundred grand! It’s, ummm, just “resting” there. In my account. I was going to transfer it to you tomorrow. Really.”

    Honestly, at this rate National will have to change it’s name to National-PF.

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  4. village idiot (748 comments) says:

    It took Labour years to look corrupt. You Tories have matched, nay bettered them in months !

    What troopers!

    What next, Mr Cooper?

    [DPF: Sadly for you the public don't share that view. In fact yesterday's Roy Morgan had National at an *all time* high and Labour and the Greens both dropping]

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  5. Redbaiter (13,197 comments) says:

    Oh gee. Mr Semmens cares about $100,000 mistakenly approved in payments to Melissa Lee. Its such a refreshing change to see a communist who actually cares about the taxpayer’s money. I remember too his loud complaining about the money stolen by Labour to finance their election campaign. What an absolutely stirling champion of the taxpayer he is.

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  6. BLiP (28 comments) says:

    Coleman, of course, is ducking and diving, seeking to blur any accountability he might have in this situation with an exercise in smokey mirrors.

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  7. Redbaiter (13,197 comments) says:

    “You Tories”

    You gormless braindead commie prick. If only Melissa Lee was a Tory instead of some politically unaware glorified welfare beneficiary making race based TV shows financed by money stolen from the taxpayer.

    Tories. Pffft, you wouldn’t have a clue you one dimensional bore.

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  8. village idiot (748 comments) says:

    Surely a ‘one dimensional bore’ is an impossibility, just as a scandal-free Tory party is an impossibility!

    You a ‘tory’ red? (Now there’s a nice juxtaposition!)

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  9. Redbaiter (13,197 comments) says:

    You’re always at the ready with false allegations, tired old political misnomers and smears but when it comes to real ideas, you don’t have anything.

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  10. village idiot (748 comments) says:

    [DPF: Sadly for you the public don't share that view..]

    Sadly for the public.

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  11. Tassman (238 comments) says:

    Poor Lee, I thought she was quite political when she was hosting her TV program but her naivity might be proven the cause of her fate. Like Philip Field, will she descend the same criterion that was established specifically for non European and Maori MPs or will she get the Tory priveleged treatment of a blunt defence and everything is hoki dori… Like a poor consumer, I think her used-by date is expired! Just don’t go anywhere near the lower socio economic areas just in case there’s an unexpected earthquake or tsunami or landlslide and a flood. That’s if you can survive a runaway burglar…

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  12. village idiot (748 comments) says:

    Smears! From you!

    Hahahahahahahahahahahahahahahahha!

    That’s rich!

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  13. Redbaiter (13,197 comments) says:

    “Hahahahahahahahahahahahahahahahha!”

    Gee. Good try. Almost had me convinced you were laughing rather than making those choking weasely squealing noises the left always make.

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  14. village idiot (748 comments) says:

    I wasn’t laughing, Red, I was typing! The only sound you would hear is the tapping of the keys. The rest is in your head.

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  15. Redbaiter (13,197 comments) says:

    “Hahahahahahahahahahahahahahahahha! I wasn’t laughing, Red,”

    I guess that should stand as testament to the amazing rationality of your average communist “green” believer.

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  16. village idiot (748 comments) says:

    Bored. Off to work I go.

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  17. Redbaiter (13,197 comments) says:

    “Off to work I go.”

    Stay home and give the taxpayers a break.

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  18. Robert Winter (100 comments) says:

    Yep, it’s a good poll for the Tories, but it won’t last, and the Government lacks a strategy and strong performers, is under attack from its own supporters for a lack of direction (Ms O’Sullivan is very grumpy with Mr Key), has a leadership challenge being promoted publicly by its own side (Mr Key to go around 2014 in favour of Mr Joyce) and, with Double Dipton, ‘Innocent Mistake’ Lee, ‘Old Goat’ Worth, ‘Economical with the Truth’ Smith, to add to ‘What Shares’ Key, is hardly a bastion of probity and rectitude. Meanwhile, Mr Brownlee has single-handedly stirred up conservationists of all shades, Ms Wilkinson has failed as a minister, Ms Bennett is being hidden from view. Ms Tolley is sinking under the weight of her portfolio. Mr Power is rescuing Mr Finlayson. Mr Hide is stuffing up the Supercity process, and when his draconian controls on localk government expenditure are revealed, will infuriate local government nationally. And debate about flat taxes and CGT will really thrill the average punter.

    2011 is no longer the clear run that National would have been expecting. Labour is feeling pretty chirpy, all things considered, and should be.

    [DPF: By speculating on whether John Key might step down partway through a third term, you seem to be conceding he will win the 2011 and 2014 elections. Thanks]

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  19. Tauhei Notts (1,644 comments) says:

    Would it be a terribly sick pun to suggest that Melissa Lee is the first portent of National’s “slippery slope”.

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  20. Redbaiter (13,197 comments) says:

    ” all things considered, ”

    Yeah. Imagine where Labour would be polling if National were doing it half right.

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  21. Simon (714 comments) says:

    Can’t make it in the real world apply here at NZ on Air for free money.

    They are probably all doing it but Lee is now an MP so she is a target.

    Audit all NZ on Air payments for the last nine years and get it all paid back.

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  22. cha (3,853 comments) says:

    Would it be a terribly sick pun to suggest that Melissa Lee is the first portent of National’s “slippery slope”

    Yup, terrible but sort of funny.

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  23. peterwn (3,211 comments) says:

    If there is a real problem, John will no doubt act decisively – recent history shows that is the best choice. It can even be a poll booster. If it is marginal then her list placing in 2011 may not be anything to write home about (62 perhaps).

    Funny there are rumours flying round the traps that John will be gone in 2014 or a bit after with Stephen Joyce becoming leader. Looks like left wing astroturfers are trying to sow little seeds of doubt everywhere.

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  24. bchapman (649 comments) says:

    I’d go for the incompetence rather than conspiracy theory on this one.

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  25. Robert Winter (100 comments) says:

    @peterwn: not the Left, Ms O’Sullivan and others in the National camp. The argument goes something like this. Mr Key can win elections but he is too pragmatic (Labour lite) and won’t deliver the policies, so, establish National in power under Mr Key, but groom a leader to take over who will use that electoral base and introduce the ‘right’ policies. It’s tied to an argument about Mr key not being into politics for the long haul. The Left doesn’t need to sow ‘seeds of doubt’, the Right is doing it quite happily.

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  26. toad (3,672 comments) says:

    @bchapman 8:32 am

    $100K worth of “incompetence” over 5 years!

    I’m not an accountant, but I do know what a contingency is. If a contingency has been funded and you don’t need it for its intended purpose, you pay it back. You don’t just pocket it.

    [DPF: So should welfare beneficiaries pay back their special needs grants if it turns out they don't need all of them?]

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  27. Herman Poole (297 comments) says:

    Robert,

    If this government ‘lacks a strategy and strong performers’ and is polling 57.5% (as a guess is this higher than labour has polled in 10 years?), please offer us your description of how labour going with 28% support?

    Your silly, mistimed comment, if at all serious, is an example of how weak-minded and delusional the labour support base is. IMO there is still bounce in these results from the last labour government that after a year shows just how loathed they really were across NZ before they were kicked out.

    It’s people like you Robert that are the cause of Nat 57.5% Lab 28%.

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  28. Robert Winter (100 comments) says:

    @Herman Poole”: ad hominem. so probably rattled, or merely grumpy.

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  29. bchapman (649 comments) says:

    The public like moderate governments who negotiate and consult- what more evidence do you need

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  30. Elijah Lineberry (306 comments) says:

    Sounds a deceitful business by a National MP.

    I have always thought (even before her comments about South Aucklanders heading to Mt Albert) Mrs Lee seemed highly ‘suspicious’; there is something about her I just never trusted and, giving credit where it is due, many thousands of Tory supporters in Mt Albert stayed home in tacit agreement with me.

    I, of course, voted for the Libertarianz candidate Julian Pistorious, but there we are.

    One hopes she will not do the usual Tory MP trick..(Worth, English, Bakshi, La Varis, Allen, Waring, Duncan Macintyre etc).. of claiming no wrongdoing and vowing to keep other people’s money; one also hopes the National party selection chappies do the right thing in 2011.

    http://www.nightcitytrader.blogspot.com

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  31. Inventory2 (10,173 comments) says:

    @ Elijah – so only Tory MP’s rort the system eh? Sheesh, I could have sworn that I read somewhere that Phillip Field got banged up last week as our first convicted corrupt MP, and he was no Tory – silly me, I must be confused, because I know that you wouldn’t knowingly mislead us …

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  32. Elijah Lineberry (306 comments) says:

    So you admit she is rorting the system? she is guilty?

    http://www.nightcitytrader.blogspot.com

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  33. bchapman (649 comments) says:

    Crikey, what an exercise in futility trying to ascribe humans failings to particular parts of the political spectrum. Both sides have their share of rotten apples, both sides have lots of earnest, honest humans beings. The role of sites like this (as well as to get lots of hits) and the media is to weed out the former and encourage the latter.

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  34. Pete George (23,309 comments) says:

    The role of sites like this (as well as to get lots of hits) and the media is to weed out the former and encourage the latter.

    You wish.

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  35. MikeG (412 comments) says:

    John Key “The contingency accounting sounded confusing”

    A bit like accounting for GST?

    What is it about accountants that National Party people employ?

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  36. toad (3,672 comments) says:

    DPF said: [DPF: So should welfare beneficiaries pay back their special needs grants if it turns out they don't need all of them?]

    Indeed, they should DPF.

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  37. Robert Winter (100 comments) says:

    @DPF: to recount a National strategy-in-the-making about National’s future leadership (the transition to Joyce option widely being discussed in National circles) concedes nothing about the any election outcome including that of 2011. One really should read what is there. not what one wants to read, unless, of course, one is very post-modern.

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  38. village idiot (748 comments) says:

    Melissa Lee was John Key’s ‘Golden Girl’, wasn’t she?

    Has that man got poor judgement or what!

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  39. Chris C (224 comments) says:

    Holy shit. I wish I had the cashflow to make a $100,000 error that could just be paid back.

    If she can make accounting errors in the multiples of thousands, not notice and be in the position to pay it back, why does she need to be subsidised to make the programmes?

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  40. kisekiman (224 comments) says:

    In the interests of denying the lefties oxygen over the issue, she should rectify the “innocent mistake” and pay it all back immediately regardless of the decision from NZ on Air.

    As an aside and I’m willing to run the risk of copping demerits for being off topic but while looking at her bio on Wikipedia it stated she was ranked as the world’s 51st most beautiful female politician in a poll conducted between 10 December 2008 and 19 April 2009 by the Spanish newspaper, 20 minutos.

    Commenters might like to check them out. http://listas.20minutos.es/?do=show&id=66425&c=1233508233

    My vote goes to number 15 for Germany, Julia Anastasia Bonk.

    Indeed.

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  41. village idiot (748 comments) says:

    It’s all over! There is nothing to see here! John Key says it was an innocent mistake.

    Here’s me thinking it was scandalous! What a duffer I’ve been!

    [DPF: I want to read the actual letters and reports before reaching conclusions. You have obviously read them, so maybe you can summarise for us]

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  42. village idiot (748 comments) says:

    Chinese word ‘pong’. Must mean something.

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  43. Rex Widerstrom (5,327 comments) says:

    John Key should by now be waking up to the fact that the words “Melissa Lee” aren’t going to crop up in any sentence that doesn’t also have the word “liability” in it.

    Another folly of MMP… “diversity” candidates. It’s fine to choose your shirts based on the desire to have one of every colour – if they prove to be faulty you can take them back and get a new one.

    But we deserve a little more thought and vetting going into a party’s choice of List MPs, surely?

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  44. Richard Hurst (796 comments) says:

    Sorry Melissa but you ARE the weakest link……

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  45. Hurf Durf (2,860 comments) says:

    Considering the only golden girls the Gweenscum have are Delahunty and Tooway, I’ll take that as a compliment.

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  46. Robinson 666 (115 comments) says:

    It was due to an accounting error.

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