'Poor and unsustainable': RNZ plans job cuts after shock $12m loss

Loss blows out to $11.8m, compared to $470,000 forecastNearly 60 full-time jobs to go by March, about one in six Internal financial reporting gave wrong picture of finances to senior managementRNZ broke the law by setting up a $5m overdraft without approvalThe revelations come after CFO Hilary Parker quit unexpectedly in OctoberRNZ has revealed a near $12 million budget blowout after a litany of financial blunders, setting the stage for sweeping job cuts.In its just-published annual report, the public broadcaster set out plans to axe the equivalent of 58 full-time jobs - about one in six staff - by the end of March and cutting running costs by at least 5 percent.The company had already signalled in August an intent to cut 25 to 30 roles, which are included in the new 58 number.The $11.8m loss is more than 25 times the $470,000 RNZ had expected to lose over the year to June.Among the errors, RNZ wrongly counted $2m from land sales as income in its budget. Staff costs also came in $3.2m over budget, including $1.4m in redundancy payments.Other running costs went $6.4m over budget, with much of the extra spending tied to the recent Auckland office move and work to get properties ready to sell.In a statement, Media Minister Paul Goldsmith said the matter was "disappointing" and he expected "clear steps to be taken to improve the situation".RNZ chair: "I've never seen anything like this"RNZ chair Brent Impey - who assumed the role in July - told Checkpoint the board would commission an independent review into what went wrong."It's incomprehensible to have got to this position," he said."This is unique in my whole experience over many many years. I've never seen anything like this, and it's almost inexplicable."The review would look into RNZ's culture, why its own reports failed to pick up the errors, whether it had the right disciplines and accountabilities in place, and whether senior leaders had been intentionally misled, Impey said.Impey said the board and senior managers only learnt the full scale of the loss in mid-October, after interim finance chief Richard Dellabarca began to "unpick some of the issues".Dellabarca - who's a board member - stepped into the role after Hilary Parker quit and left immediately on 2 October. Impey would not comment on the circumstances of Parker's departure, citing "private employment matters".Impey said RNZ had found "zero evidence of criminality and fraud". He confirmed non-disclosure agreements had been signed in connection with the matter.Impey said he shared responsibility for what had happened having joined the board in 2024, but noted he had relied on reports from management and the board's audit and risk committee."This is an organisational failure," he said.Impey also defended keeping chief executive Paul Thompson in the job until his planned departure on 31 December, saying he had accepted responsibility for the result and still had work to do.Asked why those in charge still had their jobs, Impey replied: "Well, someone's got to run the place, don't they? What do you suggest?"CEO: 'I am gutted'Thompson declined a request for an interview. In the annual report's foreword, Thompson said he took responsibility for the "poor and unsustainable" result."Personally, I am gutted this has occurred after more than a decade of leadership of RNZ," he wrote."This was not the outcome RNZ anticipated or one that management regards as acceptable. We recognise this is a poor result, and it deserves a clear explanation."The board and management had relied on "internal financial reporting" that gave them the wrong picture, meaning the company failed to cut spending enough after a 7 percent drop in regular funding, RNZ said.Thompson said his focus now was on restoring RNZ to a "sustainable financial position"."We must make difficult choices to live within our means, and I recognise those changes will be hard for our people," he wrote.Proposed changes affecting staff would be subject to the required employment processes, RNZ said.Former chair Jim Mather, who had oversight during the financial year, said the result was "extremely disappointing" and acknowledged the board was ultimately responsible for "prudent financial stewardship".RNZ brought in $70.6m over the year, putting the loss at about $1 for every $6 of income. Government funding made up $67.3m of that total, most of it through NZ On Air.The company expected to lose another $7.8m this financial year and said it had enough money in reserve to get through until its finances stabilised in 2027/28.The broadcaster ended June with $8.5 million in cash, down from $18.8 million a year earlier.Impey told Checkpoint he had not asked the minister for extra money, pointing to a one-off $51m RNZ expected to receive soon from the sale of its Henderson land.RNZ would discuss with Treasury how much of those proceeds it could keep, he said."You've got to live within your means. And at this stage, RNZ is not living within its means," Impey said.EY, which audited the accounts for the Auditor-General, also flagged a breach of the Crown Entities Act over a $5m overdraft RNZ set up without the required approval from ministers.RNZ was authorised for an overdraft only up to $3.5m. The report said RNZ drew down no more than $2.3m through the financial year and had since closed the overdraft.The broadcaster was also checking whether it needed approval for a separate $3.7m deal to sell equipment for its new Auckland office and rent it back.Thompson is due to leave RNZ at the end of the year, having announced his resignation on 22 May. NZME's chief audio officer Jason Winstanley will take over in 2027.Chief News Officer Mark Stevens will be interim CEO and Editor in Chief from 1 January until Winstanley's start date. Stevens will then continue to hold the position of Editor in Chief.