EXCLUSIVE: WAIKATO DHB – the Nats flunky taking the organisation down with him?

Many will have heard mainstream or social media chatter in the last few months about the ripoffs and rorts perpetrated by the rather unsavoury Nigel Murray, now former CEO of the Waikato DHB.

Murray spent three years upending the DHB’s organisational structure, pissing off the junior and senior doctors, and most union members in the organisation, minus the 15 months wasted gallivanting around the globe away from his job – at the cost to the taxpayer of $218,000. Given that this figure was on top of an almost $560,000 annual salary, the public have been justifiably angry at his profligacy.

Although Murray leapt off the cliff before he was pushed, in order to hide the full nature of his spending, it didn’t stop public airing of his $799 a night hotel rooms, his ‘accommodation’ of two mistresses on the public purse, or his non-attendance at international conferences the NZ health dollar funded him heavily to attend. Commendably, NZ Herald journo Natalie Akoorie has played a large and sustained part in airing Murray’s antics, unlike the local daily Waikato Times, which has been a combination of asleep at the wheel and rather too closely allied to DHB management.

Many projects under Murray have had dramatic cost blowouts, including a downtown Hamilton office block refurbishment, with no proper business case approved by the DHB Board, that leapt from $7.7M cost to $14.7M; and a ‘virtual’ or digital healthcare platform that appears to have doubled its original $8M estimate and more than halved its uptake at the same time.

How did all this happen, you ask? Where was the oversight? What was the Board doing (if anything)?

The answer lies in part with the political structure set up to govern each Board; every Board has four of its 11 members chosen by the Minister of Health, including the Chairs and Deputy Chairs. Only seven are elected on each Board.

DHB Boards are not set up to actually make any real decisions on the health spend in their areas; Health Ministers, through the Health Ministry, allocate almost all of a DHB’s Revenue, and mandate how much of it is to go into each area (eg GP’s/Primary healthcare, tertiary healthcare at the big hospitals, etc.). The Ministry sets targets for operations and procedures in every area, and there is very little room to move for local communities.

DHB Boards can only tinker round the edges of these targets and expenditure areas, and are essentially there as a piece of ‘democratic window-dressing’. The Government appoints men and women to the key positions that will be ‘safe pairs of hands’, who won’t rock the boat and will do the Government’s bidding. Having said that, some are more competent than others, and this is where the Waikato DHB story has a little more light shone on it than others.

For the Waikato DHB, the National Government appointed former senior National MP Bob Simcock as Chair of the Board some years ago. Simcock – once known as ‘Jenny Shipley’s bag-man’ when Shipley rolled PM Jim Bolger – had also been Mayor of Hamilton during the V8 debacle and massive overspend, and has been appointed to various company boards and other bodies – a true member of the local Nats’ old boys network.

In 2014, Simcock was instrumental in the Waikato DHB appointing the aforesaid Murray, who had previously been CEO at Southland DHB, leaving there under a cloud to take up the CEO post at Fraser Health, a large Canadian DHB-equivalent, before also leaving there under a cloud to come back to New Zealand. In Invercargill, Murray was outed as already working for Fraser Health before he left Southland DHB, while in Canada, he racked up $140,000 in expenses in just two years, and his organisation was under investigation when he left early to come to Hamilton.

Knowing of his dodgy history, both the senior doctors’ organisation and former Labour MP Sue Moroney personally and directly warned Simcock of the dangers in appointing Murray – before the appointment was made. Simcock claims Murray’s references were checked, but Blind Freddy could see the train wreck coming down the line – only Simcock and his Board couldn’t.

To make matters worse, Simcock – who, as in all DHB’s and most companies, is required to sign off all the CEO’s expenses, travel and conference attendance – failed to approve more than a small proportion of Murray’s expenses in advance of them happening, despite all the warnings about the guy. In one case Murray stayed in a private hotel in Hamilton for six months after arriving here (allegedly with someone who wasn’t his wife) when the normal period is one month maximum.

Every year, each DHB CEO is required to file an expenses return with the State Services Commission, which is a good monitoring tool – only Murray didn’t file one for either of the first two years, and Simcock, responsible for oversight of this, not only didn’t check this out, when he eventually found out six months later, he kept news of this from his fellow Board members for almost another six months.

The whole sordid tale of ripoffs and lack of governance is coming to light through legal and Audit NZ investigations, and another SSC investigation just starting.

But, from the public viewpoint we’ve had a rip-off artist as a CEO, and a Government-appointed Board Chair who didn’t have a clue what was going on, or if he did was too slack to do anything about it – BUT, has refused to fall on his sword, despite at least two Board members refusing to express confidence in him, as well as doctors’ organisations and many members of the public calling for him to go.

The real problem, is that Simcock’s refusal to clear out won’t allow those remaining to start looking forward, and to refocus on the healthcare needs of the region. There is a real risk that the Government could take the easy way out and sack the entire Board, in order to lance the boil, ensuring those within the Board who are trying to sort this mess out will go along with those complicit in creating the mess.