The Dunedin City Council has called in an independent
auditor to scrutinise a senior manager's contract to supply
vending machines at Moana Pool.
However, council infrastructure and networks general manager
Tony Avery said the council was still to form a view about
whether aquatic services manager Steve Prescott had a
conflict of interest from the deal.
Mr Avery did confirm Mr Prescott was in charge of negotiating
and renewing contracts to keep the machines at Moana Pool,
while at the same time profiting by up to $10,000 a year from
his own contract to restock them.
That was a matter to be considered as part of the
investigation, so the council ''has not formed a view as to
whether a conflict of interest exists'', Mr Avery said.
His comments came as he confirmed independent auditing firm
Crowe Horwath, which has an office in Dunedin, had been
called in to scrutinise the contractual arrangements
surrounding the machines.
The company regularly provided internal auditing services for
the council, Mr Avery said.
The move came after it was confirmed last month Mr Prescott
had been profiting from a private contract to supply vending
machines at the pool.
Mr Prescott later confirmed he had been receiving between
$6000 and $10,000 a year for the last 12 years from the deal.
The investigation has since been widened to include the
handling of an earlier official information request, after
the Otago Daily Times was told in February last year
council staff were not privately profiting from the machines.
Yesterday, Mr Avery also released more details of the
council's financial relationship with the owners of the eight
vending machines, four of which were owned by Coca-Cola
Amatil (NZ Ltd).
The other four had been owned by MultiSnack Ltd, later sold
to Bluebird Foods Ltd and then, earlier this year, to Vending
Mr Prescott handled the contractual arrangements between the
council and the companies, including the renewal of
contracts, Mr Avery said.
Coca-Cola's contract followed a ''competitive tender
process'', but details of the deal with MultiSnack Ltd were
less clear, Mr Avery said.
The council held no record of how the contract had been
agreed, but ''we understand'' it was also awarded following a
competitive tender process, Mr Avery said.
''All subsequent contract rollovers have been conducted by Mr
Prescott,'' he said.
Information released yesterday showing the council had
received $158,790 since 2008 from a revenue-sharing deal with
the owners of the vending machines.
The money went back into the council's aquatic services
budget and was further bolstered by an additional site fee
paid by the machine owners to the council, Mr Avery said.
Exactly how much that was worth would not be disclosed for
reasons of commercial sensitivity for the companies involved,
Mr Prescott's contract to stock the machines was with Vending
Direct Ltd, while Coca-Cola Amatil used an independent
Mr Avery told the ODT he hoped the investigation would
be complete within two weeks.
Mr Prescott remained on normal duties in the meantime, and
continued to stock the machines. His contract with Vending
Direct was due to expire early next year.