Embattled State-owned enterprise New Zealand Post has admitted paying millions of dollars in penalties to the South African Post Office after its overseas venture went sour last year.
The admission came as top NZ Post executives were hauled before Parliament’s finance and expenditure select committee for a third time to answer claims the company misled MPs about the existence of a damning report into its dealings with the South African Post Office (Sapo).
Anthrax scares failed to upset the mail market last year, with New Zealand Post reporting an increase in mail volumes of 1.3 per cent for the six months to December 31.
However, the increase in letters did not boost the performance, as NZ Post reported an after-tax profit of $16 million, down 28% on the previous first-half.
The result to December takes into account operating expenses of $5.7m for setting up Kiwibank.
The heat has been turned up on New Zealand Post after Parliament’s influential finance and expenditure committee refused to sign off its financial review and announced an inquiry sparked by it blocking the release of documents.
The finance and expenditure committee yesterday sought a six- week extension of its inquiry into New Zealand Post’s financial state of affairs after a series of revelations about its subsidiary Transend, whose three- year $54 million contract to restructure the South African postal service was terminated a year early.
New Zealand Post chiefs say they never intended to mislead MPs by denying they had a report about a troubled contract with South Africa Post.
It later emerged that they had received draft copies of the so-called Kroll report.
New Zealand Post is being accused by the Act party of trying to cover up the failure of an overseas consultancy job in South Africa.
It follows the leaking of a report into New Zealand Post’s International wing Transend and its failed postal contract with the South African Government.
The leaked report says the venture was disjointed and based on unrealistic targets.
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