Royal Mail forced to defend Toime

Royal Mail yesterday closed ranks around its new deputy chairman after allegations that Elmar Toime had presided over extravagant spending at a subsidiary of New Zealand Post where he is chief executive.
Mr Toime’s appointment to Royal Mail came days after opposition MPs in New Zealand demanded his resignation after the country’s auditor-general condemned “wasteful and excessive” spending at Transend Worldwide, a New Zealand Post unit. Royal Mail said: “We have complete confidence in the appointment of Elmar Toime. He was appointed on the basis of his proven track record and this issue has been dealt with by New Zealand Post.”

It is understood that the allegations of failing to stamp out financial impropriety at Transend, which have been circulating for a year, were known to Royal Mail chairman Allan Leighton and the government before Mr Toime’s interview and appointment.

Sources dismissed the row over Mr Toime as “a storm in a teacup” and said Mr Leighton would never have made the crucial appointment if they had had any substance.

Mr Toime, New Zealand Post chief executive for 10 years, has been taken on at Royal Mail because of his record in driving through change in postal services and retail banking. Banking is to be a pillar of the loss-making group’s renewal plan.

He has also been chosen to provide an experienced counter-weight to new chief executive Adam Crozier, the former Football Association boss appointed for his marketing skills. He is senior both to Mr Crozier and David Mills, head of Post Office Ltd.

This week Mr Toime, welcomed the auditor-general’s report and accepted there had been extravagant spending (on hotels, meals and air travel) by “a small number of staff” at Transend where he served on the board.

“I am satisfied I have taken the appropriate action in dealing with some sloppy procedures in relation to Transend,” he said.