Scenic Hotel company versus Andrew Little

Founders of Scenic Hotel Group, Earl and Lani Hagaman, say they would welcome an Auditor General investigation into allegations and insinuations made by Andrew Little, and they are considering legal action Little’s comments.

NZ Herald: Scenic Group founders consider legal action

The $101,000 donation was made on 18 September, the last week of the election campaign in 2014. A month later Scenic Hotels won a contract to manage the Matavai Hotel on Niue, which is owned by a trust appointed by Foreign Minister Murray McCully on behalf of the Niue Government.

Mr Little said the timing “stinks to high heaven” and wrote to the Auditor General last week asking for an investigation into the donation and the handling of the contract, which was signed between Scenic Hotel Group and the hotel board in October 2014.

The Auditor General is yet to decide whether to investigate but in a statement, the Hagamans said they would welcome an investigation from the Auditor General and would cooperate fully.

“In fact we request that an investigation occurs urgently in order to remove any doubt about the integrity and honesty of our name,” said Mrs Hagaman.

Lani Hagaman said the management contract for Matavai Resort Niue was gained by Scenic Hotel Group in an open and contestable process against other hotel groups.

Mrs Hagaman said it was a “political beat-up” by Mr Little.

“We are not interested in being Mr Little’s political football. These nasty and unfounded allegations need to stop and I would urge Andrew Little to stop wasting tax payer money on trying to promote his own political party and ego.”

This is a fairly predictable response to Little’s attack.

His insinuations suggested collusion between the National Party, Murray McCully, Scenic Hotels and the board members of the Niue Tourism Property Trust (including Jacinda Ardern’s father, ex policeman and New Zealand High Commissioner to Niue) in the awarding of a contract.

Ian Fitzgerald, the chairman of the Matavai Niue Limited which runs the Matavai has also now spoken, saying he would have “absolutely no concerns” if the Auditor-General looked into the process.

Mr Fitzgerald is one of four board members appointed by the Niue Tourism Property Trust to oversee the running of the hotel, which $18 million of New Zealand aid money has been invested in. The agreement was negotiated and signed between Scenic Hotels and the board rather than the Trust itself. Mr Fitzgerald said he was unaware Mr Hagaman had donated to the National Party and the board had only dealt with Scenic Hotels Group’s managing director, Brendan Taylor. It was in contract negotiations with Scenic Group for six months before the contract was awarded – well before the donation was made.

This confirms some obvious timing issues with Little’s claim – a one month timeframe from donation to awarding of the contract, suggested as a coincidence of concern, seemed far too short to have credibility.

In a statement, Mr Little said he was pleased the Hagamans would fully cooperate with an investigation. “The public deserves full transparency on this issue given National’s largest financial donor gave the party $100,000 during a tender process, then a month later his company was awarded a major government contract. The public must have confidence that the process led by Murray McCully was above board.”

Little is still digging – digging at McCully and digging a dirty politics hole.

If the Auditor General decides to investigate and finds impropriety in the awarding of the contract then there could be serious repercussions for McCully, who has signalled his exit from politics next year anyway.

If no problem is found this will not look good for Little, at a time that his credibility as a potential Prime Minister may come under increasing scrutiny and pressure.

Little has provided no evidence of impropriety, he has just made very strong insinuations in saying the timing “stinks to high heaven”.

Winston Peters gets away with this sort of dirty politics quite often but it is remarkable for a Labour leader to directly involve themselves in an attack like this.

This was a very risky move by Little, following an attack on tax expert John Shewan last week. It could be make or break for his leadership and possibly for his political career.