RNZ board approved unlawful $5m overdraft as $12m financial hole went undetected, 58 roles at risk

Summarised by Centrist

RNZ's board approved a $5 million overdraft without the legally required ministerial authorisation, while its audit and risk committee failed to detect a financial shortfall approaching $12 million. 

Despite experienced directors, financial oversight procedures and repeated assurances that spending was under control, the taxpayer-funded broadcaster is now preparing to cut the equivalent of 58 full-time roles.

According to RNZ, the board approved the overdraft in June 2026, despite the Crown Entities Act requiring authorisation from both the finance and media ministers.

A director subsequently questioned whether approval was necessary but was reportedly assured by then-chief financial officer Hilary Parker that it wasn't.

No internal or external legal advice was sought, even though RNZ's own borrowing policy referenced the relevant legal requirements.

External auditor EY eventually identified the breach, which board chair Brent Impey has acknowledged.Meanwhile, the broadcaster's financial position deteriorated dramatically.

An anticipated $470,000 deficit became an $11.8 million loss, with errors and unexpected costs including $2 million in incorrectly recognised land-sale revenue, $3.2 million in additional personnel expenses and $6.4 million in operating cost overruns.

RNZ's audit and risk committee met five times during the financial year and included experienced directors, some with accounting qualifications.

Former committee chair Jane Wrightson said the board had no knowledge of the financial problems when she departed in June.

Fellow committee member Andrew Szusterman said management repeatedly assured directors that spending was on budget.

Parker resigned unexpectedly on 2 October, with the extent of RNZ's financial problems emerging later that month. No finding of deliberate wrongdoing has been established.

Chief executive Paul Thompson has accepted responsibility, while an independent review will examine the financial reporting failures, internal controls and governance arrangements.

RNZ now plans to reduce staffing by the equivalent of 58 full-time roles by March 2027, subject to employment processes.

Read more at RNZ | The NZ Herald (paywalled)

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