22 May 2017

Whistleblowers tell of 'incredible' day their jobs were axed

9:44 am on 22 May 2017

Two former transport ministry workers have described how they were forced out of their jobs after raising the alarm about the fraudster Joanne Harrison's behaviour.

The two whistleblowers say they alerted senior managers to fake invoices and dubious travel Harrison was taking but were then targeted in a restructuring she helped lead.

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Two whistleblowers say they alerted managers to fake invoices. Photo: 123RF

Harrison was sentenced to three years and seven months in prison in February for stealing $723,000.

In addition to the theft it was revealed she tricked another government agency into hiring her husband and also got a job for a friend who was on the Ministry of Transport's payroll for 10 months but never turned up or did any work.

Last week, the ministry's new chief executive Peter Mersi announced he had appointed an independent investigator to look into claims staff who were raising red flags about Harrison were restructured out of the organisation.

He previously refused to investigate the matter.

Two of those who lost their jobs have now spoken to RNZ on the condition they are not publicly identified.

They were in no doubt the concerns they raised led to their axing.

The first said they believed an invoice Harrison presented for a company called Mazarine Associates in 2015 was fake and brought that up with their manager and others.

"I suppose I got most suspicious when I got an invoice for Mazarine, we couldn't find anything about them - they had no website, there was no phone number or email address on the invoice.

"And I remember at the time I took the invoice to a woman who worked closely with Joanne Harrison, she was like Jo's right-hand man ... and I said to her 'do you know what these people did for the ministry'? And she said 'no I don't'!

"I also raised questions about it in a team meeting about this invoice at the time, I said 'it's a very unprofessional invoice' and as it turned out this is one of the ones she used to embezzle a lot of money from the ministry."

It's now known Harrison diverted nearly $500,000 to Mazarine and another bogus consulting firm.

Other senior managers were telling Martin Matthews, the then chief executive of the ministry, they were "astounded" with Harrison's behaviour as early as 2013 - but she was not caught until 2016, and the first employee said they could not believe Mr Matthews didn't act sooner.

"I think it's disgusting quite frankly and the fact he is now Auditor-General is appalling - he should be held accountable.

"I don't think a good chief executive should allow one of his general managers to go against ministry policy - well, you could excuse it once, but to allow it to go on for three years it's not a good thing, is it."

The other employee who lost their job said they shared the concerns about the fake invoices and also alerted Mr Matthews' office to an international trip Harrison took to the United Kingdom to attend a conference which had been cancelled.

They also questioned the ministry's funding of Harrison's frequent domestic trips to Kerikeri.

They said they believed raising those red flags about Harrison had cost them their jobs.

"I've got no doubt, in my own mind, but they've probably covered themselves - the way they do when they do restructures.

"When we raised issues sometimes we were told 'you're only here to pay the invoices and if they're signed and approved that's all you have to worry about'.

"But we were old school - and we were loyal and we were conscious of it being taxpayer money."

They said the timing of the redundancies did not stack up either - being let go at the "busiest time of the year".

"December was a huge payment run and we worked very hard that month and on the 10th of December three of us walked out of the finance division and a temp walked in.

"It's incredible really - it did not make sense."

Unhappy with the terms of reference of the inquiry set up last week by Peter Mersi, they've written to the State Services Commissioner Peter Hughes asking him to investigate the matter, totally independent of the Transport Ministry.

Prime Minister Bill English told Morning Report it was not his place to express confidence in Mr Matthews.

"Parliament have to make that decision because the Auditor General is appointed strictly independently from government.

"But it is also important that the State Services Commissioner is looking into any new information about actions that should have been taken or unfair treatment of public employees."