Under-fire charity Quit Group will wind up in June once it has spent the $2.7 million it has squirrelled away, it says.
The quit smoking trust will wind up in June. Photo: RNZ / Rebekah Parsons-King
RNZ revealed on Monday the trust's four board members have continued to receive $18,000 each per year, even though the charity ceased to operate in 2015.
Quit Group - originally commissioned to run the smoking quitline - has been hoarding millions of dollars in a trust it created under the same name as the charity, including more than $400,000 received from the Health Ministry.
Prime Minister Jacinda Ardern warned yesterday the charity to either spend the money on smokefree services or give the money back to the ministry and shut down.
In a statement to RNZ, deputy chair Jan Pearson said the charity was committed to spending the reserves on a vaping and smoking quit programme and other initiatives to be announced shortly.
Pearson said Quit Group was dedicated to reducing smoking rates in New Zealand, and although it stopped running Quitline in 2015 had continued to work to achieve its aims.
She said they had offered to refund the $435,700 that were Ministry of Health funds, but the ministry identified instead a project aimed at smoking cessation for Māori women.
"There have been very few programmes or projects that were evidence-based that we considered would meet our criteria" - Jan Pearson
The group's statement said it sought advice from the ministry and later approved $1.8m for a project looking at vaping and smoking cessation.
"The Trust had a meeting with the Director-General of Health in late 2018 to again identify how the Ministry would like the surpluses spent, and also to identify if the Ministry had other projects the Quit Group Trust might fund from the Trust's own reserves, acknowledging that both the Ministry and the Trust supported the Smokefree Aotearoa 2025 strategy," it said.
It said the project was still being finalised by a Health Promotion Agency, having been delayed by the government as it sought to clarify vaping laws.
The Trust said it had also funded research into commercialising a therapeutic aid, provided funding to get cessation advisors to a tobacco control conference, helped anti-smoking group ASH with a "major grant" in 2018 and supported the group's vaping symposium at Parliament last year.
Jan Pearson told Morning Report the group had been planning on funding projects since 2015.
She said that since Quitline lost funding, there hadn't been an organisation or project worthy of funding they could give the money to.
"We've been working with the government, we've been working with HPA [Health Promotion Agency] we've been getting research done by Otago University, and we are now in a position to work with HPA on two projects we think are worthy and will make a real difference."
Pearson said the amount of time it has taken is a reflection of "the absolute decimation of tobacco control."
"The funding was lost to the tobacco control sector. There was funding through DHBs, mainly, for cessation services to individuals but very little funding for population measures such as mass media campaigns."
She said the detail about what the board was getting paid in the past years isn't relevant.
ASH, an independent not-for-profit formed in 1982, has been critical of Quit Group, calling the fund stockpiling a deplorable waste of money.
According to the Quit Group's latest financial statements the board still has assets totalling $2,726,737, down from $3,164,394 in 2016.
While no staff work for the trust, it continues to gain investment income and has paid out $702,296 since 2016. That includes paying itself $72,000 per year - or $18,000 per board member - for travel expenses, legal fees and IT costs and maintenance.
"The Trust has also agreed a number of other grants for the balance of its reserves which will be announced shortly," Quit Group's statement said.
"The Trust has met all of the reporting and expenditure agreements made with the Ministry of Health. $2.3M of the Trust's current reserves belong to the Trust and will be spent in a manner consistent with the Trust deed.
"The Trust will wind up in June 2020 having dispersed all of its reserves in pursuit of its Trust objectives."
The Quit Group trust's chair is Chris Cunningham, who stood down as chair of the Hepatitis Foundation after RNZ reported last year he had spent $128,000 on overseas travel as well as spending on lavish dinners and unaccounted for credit card expenses.
Cunningham has continued to refuse to answer RNZ's questions.