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

Kāinga Ora's Chief Executive Andrew McKenzie will be stepping down at the end of October, with a $365,000 payout.

A review has found the state housing provider needs significant savings to be financially viable.

Kainga Ora Chair Simon Moutter says it's the right time.

"Given the extent of change going on in this organisation with the changes through the Government's budget allocations to KO and the findings of the independent review...it was only right."

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Episode Transcript

Speaker 1 (00:01):
Ever do for c Ellen's Higher Order House in New Zealand,
Chief executive Andrew McKenzie has quit. He's going to leave
the agency in October with a three hundred and sixty
five thousand dollars payout. He apparently agreed with the new chairperson,
Simon Mouter, that it was time to step down as
the agency prepared to undergo significant changes in the chair
Simon Mooter's with.

Speaker 2 (00:20):
Us now, Simon, Hi, Heather.

Speaker 1 (00:22):
Did he come to you and say I want to
quit or did you go to him and say it's
time that you quit?

Speaker 2 (00:27):
Oh? No, Look, given that given the extent of change
going on in this organization, with the changes through the
government's budget allocations to KO and the and the findings
of the independent review, it was only right that we
that I sat down with Andrew McKenzie and had a
conversation about his future and given the change to his role,

(00:52):
we came to the conclusion that it was the right
time for him to move on after eight years doing
a very good job for the business.

Speaker 1 (00:59):
He seems like a really smart guy. Was he just
not up to it?

Speaker 2 (01:03):
No, he's very I think he's been a very effective CEO,
and I think If you look back at his achievements,
there were many. He's done a terrific job. He was
there at the birth of the king Or organization and
led the organization. Yeah, I know, he's done an amazing job.
Building the biggest construction program for new for residential in

(01:28):
New Zealand. The organization will deliver around three and a
half thousand new homes this year. Was an extraordinary achievement.

Speaker 1 (01:36):
But then ko is massively in debt. So was that
that smart?

Speaker 2 (01:40):
Well, No, that's the that's the financial settings that are
agreed with the government that new construction is funded one
hundred percent by debt. So that's that's been a decision
made between all of the parties, the ministries and king
Or over the last few years. And if you build
a lot of houses, you will increase the debt. And

(02:01):
now that debt's becoming expensive to service, and that's part
of why the government and the Independent Review have called
for a new plan that make sure we live with
inside a manageable debt cap and that we run the
business in a financially sustainable way. And we'll be delivering
that report in November. How we're going to do it.

Speaker 1 (02:20):
What's kind of been lost in the story with Andrew
McKenzie today is that there's also five board members who
have quit. Why did they all leave it once?

Speaker 2 (02:28):
Well, no, they the board, some of the board, the
board members we were in the process, says, you know,
the review report recommended there be a refresh of the board.
So the Minister, the Ministry and I have been working
through those changes. There will be a set of new
board members appointed later this week. And some of the

(02:51):
board members who who finished up yesterday their terms had
actually ended some time ago, and we're just staying on
for this process to take its course. And one head
resigned of their own volition earlier. So I think it's

(03:11):
just that change process occurring now, which was called for
in the report.

Speaker 1 (03:15):
Simon Ko has earned a really bad reputation of Lake.
Do you think it's all deserved?

Speaker 2 (03:22):
Look, I think the independent review particularly called out governance issues,
and governance in a state owned business is complex. It's
a three legged stool between the government, ministers, the monitoring
units and the board. And you know, I can see,
I can see how things have gone wrong in there,

(03:44):
and they've rightly been called out and it's my job
to help get those sort of but actually operationally, I
think king Or does a pretty sound job. It's not
an easy job running seventy three thousand homes with two
hundred thousand New Zealanders in them, and many of whom
have special and demanding needs. And so you know, I

(04:05):
think from what I've seen in my short time involved,
it's actually a pretty well organized business and managed by
people who really do care and want to do a
great job. And that's a good platform to build from.

Speaker 1 (04:19):
Simon, thank you so much for your time, appreciate and
best of luck turning this thing around. That Simon moved
to the Caying auto chair. For more from Hither Duplessy
Allen Drive. Listen live to news talks.

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