Registrar plays union’s game over missing accounts

Rodney Hide

I was recently told about some serious spending by the New Zealand Meat Workers Union that surprised me.

It was so surprising that I thought I should check it out.

No problem. I would just look up their audited accounts that the Registrar of Incorporated Societies would hold. That way I could determine if the story I was told was true.

I was shocked to learn the accounts aren’t there. The meatworkers have four branches and for the past seven years have only been disclosing the capitation fees paid by the four branches to the national body.

For the year ended September 2010 the disclosed income was $712,370.

The total income to the union is several million dollars a year.

That’s a failure over the years to disclose tens of millions of dollars

The law is clear. To be a union, an organisation must be incorporated. And incorporated societies must file annual financial statements that members of the public can inspect. The advantage of incorporation is that it gives a legal personality separate from the society’s members. In return, members of the public can inspect the society’s accounts.

But I can’t for the Meat Workers Union. Neither can you. And that’s been the case for seven years.

Why aren’t the meatworkers disclosing their full income and expenditure? I don’t know. I thought, at first, it could just be an oversight. I thought I would just point the failure out and get it fixed.

Parliament has provided the registrar with the power to require records. So I wrote to the registrar pointing out the meatworkers’ failure. I suggested he use his power to get the branch records for the last seven years and make them publicly available.

That was back in May. The registrar is Neville Harris, deputy secretary of the Ministry of Economic Development, which is part of a new super ministry. He advised me that he had been aware of the meatworkers’ failure to disclose their accounts since November 2011.  My information was not news to him.

He explained he had been in contact with the union and was following up with the objective of having it file a “revised financial statement” that includes information relating to the activities of its branches.

I have had no explanation why he doesn’t just demand the branch records and why he is speaking of just one financial statement singular when there are several years missing.

It’s a complete mystery to me why the registrar just doesn’t demand the branch records and made them publicly available. After all, that’s the law’s requirement of unions and incorporated societies.

Mr Harris and I now have had quite a correspondence. I can report that I am no further ahead than when I started.

This month he advised me that he has decided the way forward is to obtain an opinion from an external accounting expert and to endeavour to resolve this matter on the basis of that advice. I have no idea why the registrar is seeking that advice.

The problem is not an accounting one. It’s a legal one. The simple requirement is that the Meat Workers Union and its branches are required to disclose to the public their income and their expenditure and they aren’t.

The person in charge of making sure they do is Mr Harris. Parliament has granted him the power to ensure they do. He is refusing to use that power. Instead, he’s working with the union to get them to file and is seeking accounting advice. Heaven only knows why.

I will keep plugging away. And I will report progress.

It smells to me.

Especially in the wake of the scandal of the Australian Health Services Union.

My objective is a simple one: to get the New Zealand Meat Workers and Related Trades Union (Inc) to disclose its full accounts

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52 Comments & Questions

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Easy on, Rodney. Neville will be busy. There will be a company somewhere so busy trying to make ends meet it forgot to file last years annual return and Neville will be working them over.

The Unions, after all, have the time, muscle and money to fight back.

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Rodney have you even talked to the Union and asked them to comment?
The answer is NO!
Sorry Rodney your informant (Hamish Simson - CEO Affco, Michael Talley - Owner Affco, Allan Barber - Barber Strategic) are way of this planet, 100 years (1912) not 7 years as you claim.

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Hope they sort this out quickly, heaven only knows what the union would be saying if it was the governments books that hadn't been revealed for years.

Unions are outdated, time to get rid of them.

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Yes. You are quite right John. Business is only about making money and exploitation. The unions care for the workers. I should lighten up.

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As a self-proclaimed anarchist, Rodney, isn't the real issue that a union, a private organisation, needs to account to anyone for what they do with their money?

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Heh heh. As an anarchist I have issues with everything!

But I especially have issues with unions as anything other than voluntary organisations.

And even the Labour Party recognised that in giving unions special legislative power that there would be potential problems with the money they so acquired so they required in government that unions have to file annual accounts for the public to inspect just like any other incorporated society must agree to do.

I get very interested that there is a huge reluctance to reveal those accounts.

The more the union and the registrar resist attempts for the public to see those accounts the more interested in them I become.

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Ther seems to be a growing trend to give special treatment to ethnic and political entities unavailable to the tax payer. I see Unions as political groups.

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Thank you Rodders!

As a regular reader of Whale oil - i've learned of the MWU not having filed these accounts month's and month's ago - i've tried raising this exact issue as often as possible.

THe MWU are about 6 years late with their annual accounts. 6 years of unchecked mischief making - and no official oversight. Could NZ unions operate the same as the Aussie unions - rorting and prolific corruption by high ranking union officials? Not sure - let's look at the annual accounts.... Or should we ask Labour's latest NZ citizen for the truth and facts... Mr. Lui, Mr. Lui - if that is indeed your name, now that you've aquired NZ citizenship for only $15K directly from Labour Party MP's in a private ceremony in Parliament grounds - do you think Labour / unions would compromise NZ's integrity by acting illegally?

The hypocrisy the unions spout with requiring all employers to ensure every single "i" is dotted and every "t" crossed is astounding!

Mr. Harris should have his employment and effectiveness evaluated - as there's been a very clear dereliction of duty by him and his department over the last several years with unions filing annual accounts.

They should have given the unions 48 hours to remedy - and if not sorted by then, start formal remedies in accordance with the law the unions MUST abide by. One even needs to ask - is there a conflict of interest for him between his duties and his philosophical sympathies? Or is he just plainly incompetent?

Why the delay? Why the special treatment to the unions? Does he have some vested interest with the unions? Is he a unionist or a member of the Labour party?

The hypocritical irony here is the unions demand that ALL employers are always 100% correct with records, compliance and always operating within employment law - whose goal posts move with each employment court determination anyway - yet, the unions are nearly 6 years behind in filing / meeting their own legalities and requirements. They can't even determine their own staff's holiday pay correctly!!!

The Dept of Labour need to investigate this along with the AG!

Sunlight is the purest form of disinfectant - please, please keep looking Mr. Rodders and make sure they don't slither away from their responsibilities - either the unions or Mr.incompetent/Harris.

Please keep asking the authorities to pour sunlight into the darkest of corners - as there's been years of unchecked, un-audited, highly suspucious financial mis-management goings on with all manner of dodgy goings on happening.

The unions fund the Labour Party, who appoint Board Level and senior management into the likes of ACC, who in turn give the unions "grants" of millions of dollars for "training and safety" back to the unions.
What was achieved? What were the objectives? How many millions have the unions received during 9 years of a Labour government - now there would be some very, very interesting publically available info right there...

Keep up the great work Rodders - this single issue alone once all the dirty, corruption has been revealed could completely sink the corrupt Labour Party and their bully boy unions. NZ deserves nothing less - so please keep chasing this issue until ALL the facts are publicaly available...

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How was ACT's accounts ?

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ACT, like Labour, National, NZ First, the The Greens, and all other political parties in NZ, is not an incorporated society. Thus, its officers do not enjoy the benefits of limited liability that union officials do. Also, political parties are funded entirely voluntarily. Unions are not.

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Dont you get compulsory fundingfrom the taxpayer at election time?

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If the unions were companies Nevill Harris would be threatening them with closure for failure to comply with the law. He should do the same here. Just disestablish them.

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Time for a complaint to the Ombudsman, Rodney.

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Right, Alan. And the Ombudsman will do what exactly? She will be more ineffective than her mate Neville.

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I agree that the Ombudsman, since Sir Guy Powles, has progressively been dumbed down by a succession of career bureaucratic poodles.

Nevertheless, since the State Services Commission has become even worse, it remains the only sanction against bureaucratic malpractice other than expensive and equally glacially-slow court action.

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Alan, I think ultimately it may be more serious than that.

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"The person in charge of making sure they do is Mr Harris. Parliament has granted him the power to ensure they do. He is refusing to use that power. Instead, he’s working with the union to get them to file and is seeking accounting advice. Heaven only knows why".

I think you're drawing a long bow here Rodney. It is Mr Harris's statutory duty and obligation to ensure compliance, and he should be brought to account by the Minister, for his failure

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I am not sure of the long bow to which you refer. What the Minister does is up to him!

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I don't remember the details but didn't one of the meat companies during the strike earlier this year mention that there is something amiss with union funds?
The union said "nothing to see here" and the press dropped it quicker than you can say EMPU. Could be no connection to what Mr Hide has mentioned or there could be...

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Rodney you should search all the writings of the Owl on whale oil....the meat workers union is only one he has uncovered. I am sure Cameron Slater would give you all the stuff he has written about

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Yes agree read the Owls writing

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Yes indeed. I learned of the issue from the Whale. I have Owl's posts with much interest.

Thank you.

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Fantastic!

That's exactly where i've received my info from too. Whale Oil seems to be the only honest and legitimate investigative journalism around - besides NBR - all the other MSM appear to be so far left leaning they all need crutches to stand somewhere near balanced!

How is it a quasi-political party can hide and obfuscate financial situations, loans, and hyjinks whilst operating as political activists - having business's and workplaces collect their union membership fees for them, whilst the unions and union officials use these funds as their own "slush fund" they can take from when ever and how ever they like?

Without any official oversight for years and years!

Why is the Auditor General not looking into the blatant rorting and "related party" funding of the unions by the Labour Party from various tax payer funded government departments - once Labour become a government each time?

What is the difference between an individual syphoning off millions of dollars of funds that isn't their's and political activists deliberately inflicting industrial sabotage tothe tune of millions of dollars,(PoAL anyone?) at the complicit behest of the Labour Party to further their own political / activist interests?

Is this not deliberate and calculated industrial sabotage upon NZ Inc by the unions and the Labour Party?

The AG and the SFO are being caught with their pants down. Unions are operating without official oversight and because of that, some have had nearly 6 years of being able to "fudge" the books - where members of those are intimidated into silence whenever they ask for financial details relating to those unions.

Does the PM need to order a Royal Enquiry over these issues? It seems a major political party have been funded for years by illegally registered entities and resulting illegal activities and the AG / SFO are alseep at the wheel over their responsibilities with keeping NZ corruption free?

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yeah I have read Owls as well, frankly more credence given to Winston Peters. And if Whaleoil says its true, then damn well double check on that

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So really what you are saying that unions don't follow the laws of the land or the monitoring govt department are failing in their jobs. Whale and the Owl (whoever he is) seems to had too different sides. whale is just anti unions where the owl seems to be more interested in process.

I think there some big questions to be asked. Insolvent unite union have just been allowed to set up a chartible trust that's looks just like a union.

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Just saying.... I wonder if Unite Union's new charitable trust has approx. $152K in "assets"?

Conveniently about the same amount of money McCarten and Unite have owed the NZ tax payer for years and years.

Surely there's some highly suspect and dodgy goings on here - especfially where McCarten is involved - he and his union are a cancer on working NZ - so I really hope the SFO / AG are getting out their miscroscopes and opening dark corners to the disinfectant qualities of brilliant sunlight!

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Let's get back to the Big City Auckland and draw parallels to transparency.

The ACC is paying out tens of thousands of dollars in compensation for bullying in confidential settlements (in other words, cover-ups). And we only now know of the scale of the problem because we have whistleblowers bringing the cases to the public's attention.

What are you doing about it, Mr Hide? Ye creator of super city to herald in an era of responsibility and efficiency for Aucklanders from the creation of the super city?

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You miss the point. This about statutory filing of returns like tax returns. It is not a political statement. It is about if you have a car you need a license to drive. Simple

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One badly behaved union does not make all unions bad, except if you are right wing.

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Rodney the Owls work included a number of articles on the EMPU and their Training Foundation which is insolvent and the movements between the main EMPU and trust accounts. NBR ran an article on the EMPU failure to disclose the Pike River Fund. The NZCTU profiteering to stay afloat on ACC contracts. The MUNZ trust which donates money to the Union each year. What your thoughts?

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I read those articles. I am amazed they get away with it. However, I have done no work on those cases. The Meatworkers are enough for me for now!

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So Rodney does that mean you will be following up after you have done the meat workers union case?

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Right on the money here Rodney. The registrar is not a toothless tiger, but my experience is that the office is just never willing to use them... Keep up the pressure.

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Well Rodney as hopeless as the Companies Office/Registrar of Incorporated Societies may be have you ever had reason to study the work of it's sister organaisation the insolvency service?

Astonishing is the only way I can put it having had the misfortune to have them appointed liquidators to a company that owed one of mine a fortune. They did absolutely nothing when the Directors, having begged the Judge for a stay of execution on the basis they were 'trying to raise the money', promptly used the month's grace to transfer everything out of the company to an identical newly formed company. They (the Insolvency Service) tried to tell me it was standard commercial practice.

Unbeleivable!

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You get what you pay for.

Next time use a private sector liquidator. Why should the tax payers fund the creditors of a company in liquidation if the creditors themselves cannot be bothered to pony up?

You are just another prat looking for a government hand-out. Stop whining and write a cheque.

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Yes guys I agree I should have got a private liquidator in but there was a big IRD debt there as well and it looked awfully doubtful that there would be a collect. Turned out there were assets but no action from the Insolvency service to collect. Plus the Director came from a well known slippery family and we had blown a fortune on the deal already. Simply to pay a liquidator would have been as risky as a punt on an outsider at Te Rapa.

You may well be correct but the point is this - why have an insolvency service if they refuse to do the job properly? This was a case where the evidence was plain as day but do you think they would act?

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So you were not willing to risk your own funds to recover debt owed to you. Why should the taxpayer in general take the risk then in pursuing legal options to recover those assets if you as a creditor are not willing to?

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If it looked awfully doubtful to you that there would be a collect in pursuing this matter then wouldn't it be logical that it would have looked the same to the insolvency service?

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It looked extremely doubtful before the liquidation went through hence not throwing good money after bad by paying our own Liquidator. It only became apparent what was available afterwards.

And we may well have been mugs in this but the IRD had a $110000 debt which would have got paid ahead of us but Insolvency Service inaction made no attempt to recover that either so every single one of us taxpayers had a share in the debacle.

Just a disgrace which I do not dwell on but just because that is the case doesn't mean I have forgotten

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Why did the IRD not pay to chase thsee alleged assets?

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I think you miss the point - their job as liquidator is to assess the records and identify possible recovery actions. It is not their job to take on the cost and risk of those actions on behalf of the creditors who are the only ones to get the benefit of any recovery. It is up to the creditors to pay for that if they wish to pursue it as in any normal debt collection.

Also hard to reconcile your statement that the evidence was plain as day and yet you also believed that to pay a liquidator would be as risky as a punt on an outsider at Te Rapa.

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Liquidation is in the end a debt collection process. Why would you not simply seek to appoint a different liquidator if you thought the insolvency service was not handling the liquidation to the required standard? Did you do this?

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Getting a liquidator change is not quite as simple as that apparently. Our error was at the intial point when we did not get our own liquidator appointed.

As in my previous reply the evidence was on a plate to the Insolvency service but they refused to make use of it.

We were expecting nothing out of the liquidation but were dismayed to find that there could have been but slack Government Departments didn't bother to act.

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If the evidence was on a plate then why would it have been so risky for you to seek a change and pay a private liquidator to chase those alleged assets?

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Yes. I have heard some shocking stories of the insolvency service but haven't had the opportunity to follow up.

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mmm Maybe mr Harris belongs to a union and is just giving them time to rewrite them so they will read legal?
John M.

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It's been a very long time (17 years) since I worked for the Company's Office and did Incorporated Societies Act stuff (pre union's becoming incorporated societies in fact), but I recollect that the penalties for non-compliance in filing accounts were very low (circa $100 fine for failure if convicted). Not much incentive to comply there.

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Merely another example of ineffective civil servants or government ministers incapable of making decisions that may make them accountable in any way.They are everywhere!

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What's wrong with the writings?

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I have read the Owls work too. I noted when he started to raise the issue the unions started to post their accounts ASAP. Doesn't that say something? I also understand from his writings he only uses information in the public domain which is quite interesting that he has been able to do so much analysis. Whether his conclusions are accurate I don't know but he has definitely brought to the attention the gaps in the processes. I think Rodney has just given us all a clear working example. As Rodney says there are laws that must be followed and their is a ministry job to enforce.

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Careful Rodney! there is a big difference between a union or society filing accounts incorrectly based on poor advice from the independent professional accountants employed to manage that and corruption.
Are you accusing the union of corruption Rodney?, in this public forum Rodney? or are you libelling to get a higher profile?

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Rodney any update?

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