Latest / Best of Business / Simon Moutter: Kāinga Ora Chair says it was the right time for CEO Andrew McKenzie to step down

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Simon Moutter: Kāinga Ora Chair says it was the right time for CEO Andrew McKenzie to step down · Best of Business

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  Speaker 2: Ever do for ce Ellen's.
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  Speaker 3: Higher Order House in New Zealand, chief executive Andrew McKenzie
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  Speaker 3: is quit. He's going to leave the agency in October
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  Speaker 3: with the three hundred and sixty five thousand dollars payout.
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  Speaker 3: He apparently agreed with the new chairperson, Simon Mutter, that
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  Speaker 3: it was time to step down as the agency prepared
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  Speaker 3: to undergo significant changes in the chair Simon Mooter's.
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  Speaker 2: With us now, Simon, Hi, Heather.
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  Speaker 3: Did he come to you and say I want to quit?
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  Speaker 3: Or did you go to him and say it's time
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  Speaker 3: that you quit?
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  Speaker 2: Oh? I look, given that given the extent of change
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  Speaker 2: going on in this organization, with the changes through the
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  Speaker 2: government's budget allocations to KO and the and the findings
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  Speaker 2: of the independent review, it was only right that we
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  Speaker 2: that I sat down with Andrew McKenzie and had a
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  Speaker 2: conversation about his future and given the change to his role,
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  Speaker 2: we came to the conclusion that it was the right
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  Speaker 2: time for him to move on after eight years doing
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  Speaker 2: a very good job for the business.
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  Speaker 3: He seems like a really smart guy. Was he just
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  Speaker 3: not up to it.
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  Speaker 2: He's very I think he's been a very effective CEO,
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  Speaker 2: and I think if you look back at his achievements,
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  Speaker 2: there were many. He's done a terrific job. He was
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  Speaker 2: there at the birth of the king Or organization and
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  Speaker 2: led the organization one thing. Yeah, he's done an amazing
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  Speaker 2: job building the biggest construction program for new for residential
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  Speaker 2: in New Zealand. The organization will deliver around three and
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  Speaker 2: a half thousand new homes this year. Was an extraordinary achievement.
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  Speaker 3: But then KO is massively in debt, so was that
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  Speaker 3: that smart?
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  Speaker 2: Well, No, that's the financial settings that are agreed with
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  Speaker 2: the government that new construction is funded one hundred percent
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  Speaker 2: by debt. So that's that's been a decision made between
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  Speaker 2: all of the parties, the ministries and king Or over
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  Speaker 2: the last few years. And if you build a lot
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  Speaker 2: of houses, you will increase the debt. And now that
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  Speaker 2: debt is becoming expensive to service, and that's part of
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  Speaker 2: why the government and the Independent Review have called for
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  Speaker 2: a new plan that makes sure we live with inside
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  Speaker 2: a manageable debt cap and that we run the business
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  Speaker 2: in a financially sustainable way, and we'll be delivering that
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  Speaker 2: report in November. How we're going to do it.
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  Speaker 3: What's kind of been lost in the story with Andrew
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  Speaker 3: McKenzie today is that there's also five board members who
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  Speaker 3: have quit. Why did they all leave it once?
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  Speaker 2: Well, no, they the board, some of the board, the
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  Speaker 2: board members, we're in the process, says, you know, the
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  Speaker 2: review report recommended there be a refresh of the board.
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  Speaker 2: So the Minister, the Ministry and I have been working
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  Speaker 2: through those changes. There will be a set of new
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  Speaker 2: board members appointed later this week. And some of the
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  Speaker 2: board members who who finished up yesterday their terms had
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  Speaker 2: actually ended some time ago, and we're just staying on
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  Speaker 2: for this process to take its course. And one head
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  Speaker 2: resigned of their own volition earlier. So I think it's
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  Speaker 2: just that change process occurring now, which was called for
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  Speaker 2: in the report.
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  Speaker 3: Simon Ko has earned a really bad reputation of late.
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  Speaker 3: Do you think it's all deserved?
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  Speaker 2: Look, I think the independent review particularly called out governance issues,
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  Speaker 2: and governance in a state owned business is complex. It's
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  Speaker 2: a three legged stool between the government, ministers, the monitoring
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  Speaker 2: units and the board. And you know, I can see,
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  Speaker 2: I can see how things have gone wrong in there,
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  Speaker 2: and they've rightly been called out and it's my job
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  Speaker 2: to help get those sort of but actually, operationally, I
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  Speaker 2: think kaying Or does a pretty sound job. It's not
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  Speaker 2: an easy job running seventy three thousand homes with two
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  Speaker 2: hundred thousand New Zealanders in them, and many of whom
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  Speaker 2: have special and demanding needs, and so you know, I
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  Speaker 2: think from what I've seen in my short time involved,
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  Speaker 2: it's actually a pretty well organized business and managed by
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  Speaker 2: people who really do care and want to do a
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  Speaker 2: great job, and that's a good platform to build from.
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  Speaker 3: Simon, thank you so much for your time, appreciating best
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  Speaker 3: of luck turning this thing around. That Simon moved to
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  Speaker 3: the coying or auto chair.
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