The Billion dollar Dilworth Charitable Trust Should be Wound Up and the Funds Paid to Sexual Abuse Victims.

This article I wrote is in the Herald today. It's dedicated to the children who fell victim to sexual abuse at Dilworth College over more than half a century. It was sent to the Herald on my behalf by the University's Media Adviser, after being fact-checked. Truth be told, NZ Universities do believe in free speech and do support us to write such articles.

Sexual abuse was perpetrated by paedophiles working for Dilworth College from the 1950s up until at least 2005. Many of the boys who were abused were from poor families and had widowed parents. The College is owned by Dilworth Charitable Trust, which has set aside about $50 million to pay abuse claims. The Trust's assets are currently valued at nearly $1.2 billion, so the compensation only represents around 4% of that number. A drop in the bucket.

The incoming Chair of Dilworth Trust said the school had failed to put the needs of the boys in their care above the reputation of the school. The Trust’s assets were in turn protected, ensuring that things have worked out pretty nicely for Dilworth from a financial standpoint.

A report on the abuse, following an independent inquiry led by Dame Silvia Cartwright, comes with a distressing content warning: ‘We have chosen to include some of the former students' experiences in their own words’. It goes on to say that ‘students were extensively groomed and abused by Dilworth tutors, housemasters, chaplains, teachers, scout volunteers, staff friends and associates and friends of friends’.

Had the abuse been reported to the police and not covered up at the time by Dilworth, the Trust would have likely gone bankrupt. No one would have wanted anything to do with the place. Instead the Trust has emerged as one of NZ’s ten richest charities. Most of the other nine are owned by our public universities or were set up by iwi after treaty settlements.

Dilworth successfully managed its reputation for decades by suppressing evidence about the sexual assaults. It thereby stayed out of trouble whilst quietly adding to its vast wealth. Just under 200 Dilworth students have now provided information about what went on. Payouts per victim range from $0 to $200,000. However, Ministry of Justice statistics show only about 6% of sexual abuse victims come forward. Had all Dilworth victims received compensation, and it properly valued their physical and mental well-being losses, as an economist, I believe the bill would add up to more than the Trust’s entire assets today.

Dilworth’s cover-up meant many victims have long since died … no reparations for them. The trivial abuse payouts the Trust is now making don’t even dent its finances. A not unrelated scenario occurred after World War II when Swiss banks tried to hold onto the dormant accounts of dead people who couldn’t turn up to claim them.

As for the 6 male Dilworth Board Trustees, they received a total income from the Trust of between $500,000 & $600,000 last year. For what? Attending meetings? The 8 members of the Trust’s Senior Management Group take home $2.8 million in remuneration per annum. Meanwhile, in 2023, accounting firm KPMG charged $115,000 for its services. Not to be left behind, bankers in charge of Dilworth’s share portfolio take nearly $200,000 in management fees year after year.

Who knows how much the real-estate managers of Dilworth’s $730 million "investment property" empire get paid? Nearly $4 million per annum is sucked out of Dilworth by a small group of management types.

Has NZ acquired an over-abundance of "advisers" and "managers" benefitting from Charitable Trusts? Large cash flows are generated by many charities since they pay no tax.

Shame about the left-over scraps thrown to the abuse victims.

Things get stranger. Why did the Trust open the $50 billion credit line it has with Industrial & Commercial Bank of China? It costs between $3 million and $4 million in annual interest payments. However Dilworth already holds $135 million in cash & liquid funds. Why leverage up?

The Trust enjoys an annual $870,000 grant from the government. You, the taxpayer, support it. Private schools get a public subsidy, but why Dilworth, with its history of sexual abuse, cover-ups, billion-dollar wealth, and annual income of $45 million?

Let's not finish with a conclusion. Other than to say Dilworth College should continue but as a Charter School. The Trust, on the other hand, should end and have its assets confiscated under the Criminal Proceeds (Recovery) Act 2009. They should be put into a fund to help the victims of abuse. Its ongoing existence is a disgrace. It sits as proof that crime pays and cover-ups rewarded.

The independent report admits sexual abuse was not reported to prevent reputational damage. That lack of damage can be valued. The Trust is now worth $1.2 billion.

No one will ever hear about the trauma suffered by victims who never came forward, or the anguish of abused who have died. Yet the Board and its managers are getting highly paid with money the Trust would've never owned had the terrible crimes at the School not been suppressed. Dilworth’s cover-up has meant that many of the victims will never get a cent.

My Former Economics MPhil and DPhil Class-Mate for many hard years, Mark Carney, becomes PM of Canada.

Congratulations Mark Carney. When I went to the UK to study economics, we started off doing a degree called Master of Philosophy in Economics (still don't know why 'philosophy' is in the title). On that first day, I remember a guy called Mark Carney in the class room. What was unusual with Mark was that, whereas most of us were quite young and had no private-sector experience, he had already worked for many years at Goldman Sachs. He was probably in his late 20's and no doubt already a multi-millionaire from his five years or so in that investment bank. A rich student is an unusual phenomena. After a wildly successful career as Governor of Reserve Bank of Canada, then Governor of the Bank of England, he is now about to be Prime Minister of Canada. At least some folks in the class have become successful. Had Mark been a Kiwi, he'd be lucky to have become Senior Economics Analyst in the NZ Treasury or Assistant Monetary Policy Adviser at the Reserve Bank, given Human Resources Hiring Practices here. As for Vice Chancellor of Otago, Grant Robertson would have obviously been appointed instead, and Carney would've missed out on Treasury Secretary because career bureaucrat Iain Rennie would have sneaked in ahead.