Jonathan Milne

For a couple of years now, the Auditor General's office has been sounding a note of concern about the financial statements from the council every year and questioning whether it could actually remain as a going concern, which is a pretty serious concern.

And the council had acknowledged that and said, well, basically, we are really struggling.

They were...

constantly living at the very limits of their $500,000 overdraft.

The former mayor, Monique Croon, told me there were rusty, derelict cars piling up all over the island that they couldn't afford to move, they couldn't afford to fix the potholes on the road, despite some funding from NZ Transport Authority.

So they were really struggling just to do the basics.

Their rates can't even come close.

They don't even pay a fraction of what it costs to maintain the infrastructure on the island, like the roads, like the airport, like the port.

So what they get is a grant from internal affairs from the government every year, several million dollars, that basically keeps the wheels turning.

But they say even that wasn't enough and that they were struggling to deliver.

Yeah, I mean, I talked to you about this $500,000 overdraft and they're living at the limits of that.

Well, guess what?

The new CEO comes onto the island and even before he started in the role, he told the outgoing CEO, hey, you need to put some real money into the council house that I'm going to be bringing my wife and child over to live in because it's...

pretty run down, hasn't been upgraded for about 15, 16 years.

So initially the council agreed to, you know, to about $200,000, I think, on renovation.

And then with the incoming CEO, Paul Eagle, was urging they up that to $500,000, half a million dollars.

The same number as their bank overdraft.

So this...

Ended up being quite gold-plated.

Poor legal us for high-end, merely kitchen appliances.