Ryall dismisses criticism over South Link dispute

Tony Ryall.
Tony Ryall.
''Electioneering nonsense'' is how Health Minister Tony Ryall describes a call for scrutiny of his actions over the South Link Health funds dispute.

Green Party health spokesman Kevin Hague said Mr Ryall's handling of the issue should be included in a Royal commission of inquiry into Cabinet ministers' behaviour.

The inquiry should consider ''why Southern DHB didn't act sooner and the Ministry [of Health] barely acted at all''.

The Ministry of Health was asked to investigate the multimillion-dollar Southern health funds dispute in December 2010.

Last week, following advice from forensic investigators hired by the DHB in February, the Southern board referred the dispute to the Serious Fraud Office.

The dispute is over the spending of about $5.3 million in savings (now believed to be about $15 million with interest) SLH achieved on contracts with South Island district health boards in the 1990s.

South Link Health rejects any suggestion of fraud, saying it spent the money on approved programmes and has no case to answer, commercially or criminally.

Earlier this year Mr Hague, a former West Coast DHB chief executive who has been closely following the dispute, alleged the ministry had not really done anything, because Mr Ryall did not want it to.

He alleged this was also the reason the DHB had not complained to the police or the SFO previously, or pursued court action.

He said he could not prove that at the time, and accepted it was denied, but ''no convincing explanations'' for the inaction were given.

''I think we have to consider the ministry's strangely slow and half-hearted response to the matter being referred to them against the backdrop that has been revealed over recent weeks.

''Tony Ryall's friend and parliamentary next-door neighbour Judith Collins stands accused of exactly this kind of inappropriate boundary-crossing, and many believe this to be endemic in the National Government.''

An inquiry should not be restricted to the behaviour of Mrs Collins, he said.

Its scope had to be broad enough to ''probe the wider culture of unethical behaviour by Cabinet ministers''.

Mr Ryall did not answer questions about whether he had concerns about the Ministry of Health's failure to investigate the dispute when asked to do so by the DHB in 2010, or if there would be any review of the ministry's actions.

His office said because the matter was before the SFO, he had nothing further to add.

The State Services Commission, asked whether there was a need for review of the ministry's actions, said it was ''unable to comment, as this matter has been referred to the Serious Fraud Office and may be the subject of an investigation''.

The office of the Auditor-general, which was alerted to concerns about the ministry's apparent inaction over the dispute last year by DHB member and former Otago DHB chairman Richard Thomson, also had no comment on the review question.

In its report to the DHB last October, Audit New Zealand said the board should refer the dispute to the police if it considered there was evidence of fraud. If it did not consider there was fraud, it should reach an agreement with South Link Health on ''future actions'', the office advised.

The Ministry of Health this week avoided answering when asked whether there would be a review of its handling of the matter.

The acting director of the National Health Board, Michael Hundleby, said ''after being referred the commercial dispute, the National Health Board agreed to join mediations with South Link Health and Southern District Health Board to work with both sides to come together and resolve this matter''.

Former Southern DHB chief executive Brian Rousseau, who released some emails related to the dispute earlier this year because he was concerned about the accuracy of statements being made about the knowledge of the possibility of fraud, said he did not wish to comment on the referral of the dispute to the SFO.

Former board chairman Errol Millar said he was pleased the dispute was going to be investigated.

The matter had gone on ''far too damned long''.

It is not clear how long any investigation might take.

At this stage, the SFO said it could only confirm the referral.