Callaghan spending on entertainment and travel goes under the microscope

Callaghan Innovation spending has been put under the microscope by the New Zealand Taxpayers’ Union, which yesterday released a breakdown (HERE) of the science-funding agency’s entertainment expenses for 2015/16.

The privately funded monitor of public spending also examined Callaghan Innovation’s spending on domestic and international airfares in 2015/16.

For good measure, today it announced it has asked the Ombudsman to look into its allegation that Callaghan Innovation abused the Annual Report process to avoid responsibilities under the Official Information Act.

The Taxpayers Union has long been carping about aspects of the public funding of research and development.

In June last year its report, Socialism for the Rich, by Jim Rose, showed the annual cost of “corporate welfare” had climbed to $1.6 billion – or $931 per New Zealand household.

The Taxpayers’ Union commented:

In the past, the Government has directed investment at ‘public good’ science – research and development that has low commercial viability. Now, funding is going towards trying to commercialise technologies in the private sector. It’s socialised costs for privatised profits.

Last month the Taxpayers Union revealed Callaghan spent $304,000 on “entertainment” in 2015/16.

At the weekend it published a breakdown (available here) of those expenses for 2015/16.

Among the items were:

* $5212 on 188 visits to the Beer & Burger Joint (downstairs from Callaghan’s Auckland office);

* $4298 on lunches and dinners at Marvel Bar and Grill;

* $2063 on a team dinner at a drag queen cabaret bar (K Road’s Caluzzi);

The Taxpayers Union commented:

“Much of this spending is justified as entertaining ‘clients’ – but that’s absurd considering this agency’s ‘clients’ are actually businesses receiving Callaghan’s taxpayer-funded handouts. These ‘clients’ are already getting taxpayer pork; boozy dinners and latte lunches are just the gravy on top.”

According to the Taxpayers Union analysis of Innovation travel expenses, the 384 staff (as per their 2016 Annual Report), spent an average $2,641 apiece in domestic airfares and $1,079 on international airfares.

The union’s comments:

“Where on earth is Callaghan flying? They already have teams based in Auckland, Wellington, and Christchurch.

“The international travel spend is just as bad. Callaghan only operates in New Zealand, but still spent $414,000 on overseas airfares in just a year.

“We suspect part of this travel expenditure is for ‘customers’, i.e. businesses applying for grants. This is absurd – these businesses are receiving taxpayer money, now we discover we also pay for their flights, accommodation, wining and dining

The referring of Callaghan Innovation to the Ombudsman is a response to Callaghan’s response to a request on August 10 for a breakdown of its entertainment expenses for the most recent financial year, 2016/17.

Callaghan denied this request on the basis that:

“If we were to provide you with the information you have requested, we would be releasing information about our total expenditure before it is published within the Callaghan Innovation 2016/17 Annual Report. We are therefore refusing your request for this information under section 18(d) of the Act, as the information you have requested will soon be made publicly available.”

When the Annual Report was released later in the year, total expenditure figures were included but not broken down to show entertainment, accommodation, and airfares.

Callaghan has said (HERE) its total spending was “not unreasonable for a client-facing organisation of our size”, but there were a few cases of spending that were “not appropriate”.

It said it has tightened relevant policies to ensure work-related spending by staff is modest and appropriate for the public sector.


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