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.
ENDS.
***********************
A Former Trustee of Dilworth Trust Responds to our NZ Herald Article
A former Dilworth Trustee asks that his response to our article be posted. He wonders (below) whether I've any connection to these issues - a colleague of mine for many years in the Business School has been Jonathon Mason - incoming Chair of Dilworth - who is quoted by OneNews as apologizing to survivors, ''acknowledging it had "buried, blocked, ignored and denied" horrors over decades' and had “failed to put the needs of the boys in their care above the reputation of school.”
Dr MacCulloch,
I was a trustee of Dilworth for much of the time covered by the horrible and unforgiveable abuse. If you Google the Royal Commission on Abuse for my evidence (which is not very long) you will see another side of part of the story.
One of the bases for your article is the tirelessly repeated falsehood about covering up the abuse. This is simply not true, as I have tried to point out in my submissions to the two inquiries, the media and to others.
The allegations of cover up are almost as bad as those of the abuse itself. Every substantiated allegation of abuse but one was reported to the police as I demonstrated to both inquiries in a tabular form. It was the case of the first chaplain abuser Peter Taylor in 1978 when the only allegations at the time were of inappropriate touching. The trustees on the advice of the then Chair and myself were concerned that the (fewer then than now) victims would not be believed in a threatened trial. (Taylor was dismissed and reported to the Bishop. He was subsequently reported by a victim, tried, imprisoned and has since died.)
I am sure that if you were accused of abuse towards a colleague or student you would expect it to be investigated and found to have prima facie merit before the University would decide to report you to the police.
May I emphasise that the recent allegations against Taylor are more numerous than originally and much more serious including rape. The allegations at the time were from few victims and of a much less serious nature. This is not a criticism of the victims. I understand it can be the nature of these sad issues.
When the allegation of cover up first emerged (some years after I had retired) I urged - begged - the trustees to publicly state the above explanation but they refused and as a result the issue has festered ever since like an un-lanced boil. I included this in my evidence to both inquiries. The Cartwright Inquiry simply believed the dozens of victims who firmly believed this false assumption.
Incidentally, the terms of the Cartwright inquiry (available on the Dilworth web site) were strictly to be a forum in which the victims could tell their stories and the inquirers were expressly told not to apportion blame. This setting in which the victims were encouraged to tell their stories was then totally abused by those inquirers.
I do not know if you have any connection with former Dilworth students or anyone else relevant to the issues but assume not or you would surely have made an appropriate disclosure.
You may or may not be aware that a small hard core of Old Boy critics (not all of whom were abused) have been calling for the school to be closed and the proceeds of the trust to be distributed amongst the victims. They are not supported by a majority of victims.
As for your suggestion that compensation should be proportionate to the assets of the organisation which employed the abusers, I do not hear you say that of the Catholic Church or the NZ government or the Australian government or the Canadian government. Why single out Dilworth for such a suggestion?
You may be interested to know that another former trustee is an admirer of your pieces on economics but, like me, wonders why you have chosen to write on Dilworth.
Yours faithfully,
Derek Firth
Professor Robert MacCulloch holds the Matthew S. Abel Chair of Macroeconomics at Auckland University. He has previously worked at the Reserve Bank, Oxford University, and the London School of Economics. He runs the blog Down to Earth Kiwi from where this article was sourced.
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.
ENDS.
***********************
A Former Trustee of Dilworth Trust Responds to our NZ Herald Article
A former Dilworth Trustee asks that his response to our article be posted. He wonders (below) whether I've any connection to these issues - a colleague of mine for many years in the Business School has been Jonathon Mason - incoming Chair of Dilworth - who is quoted by OneNews as apologizing to survivors, ''acknowledging it had "buried, blocked, ignored and denied" horrors over decades' and had “failed to put the needs of the boys in their care above the reputation of school.”
Dr MacCulloch,
I was a trustee of Dilworth for much of the time covered by the horrible and unforgiveable abuse. If you Google the Royal Commission on Abuse for my evidence (which is not very long) you will see another side of part of the story.
One of the bases for your article is the tirelessly repeated falsehood about covering up the abuse. This is simply not true, as I have tried to point out in my submissions to the two inquiries, the media and to others.
The allegations of cover up are almost as bad as those of the abuse itself. Every substantiated allegation of abuse but one was reported to the police as I demonstrated to both inquiries in a tabular form. It was the case of the first chaplain abuser Peter Taylor in 1978 when the only allegations at the time were of inappropriate touching. The trustees on the advice of the then Chair and myself were concerned that the (fewer then than now) victims would not be believed in a threatened trial. (Taylor was dismissed and reported to the Bishop. He was subsequently reported by a victim, tried, imprisoned and has since died.)
I am sure that if you were accused of abuse towards a colleague or student you would expect it to be investigated and found to have prima facie merit before the University would decide to report you to the police.
May I emphasise that the recent allegations against Taylor are more numerous than originally and much more serious including rape. The allegations at the time were from few victims and of a much less serious nature. This is not a criticism of the victims. I understand it can be the nature of these sad issues.
When the allegation of cover up first emerged (some years after I had retired) I urged - begged - the trustees to publicly state the above explanation but they refused and as a result the issue has festered ever since like an un-lanced boil. I included this in my evidence to both inquiries. The Cartwright Inquiry simply believed the dozens of victims who firmly believed this false assumption.
Incidentally, the terms of the Cartwright inquiry (available on the Dilworth web site) were strictly to be a forum in which the victims could tell their stories and the inquirers were expressly told not to apportion blame. This setting in which the victims were encouraged to tell their stories was then totally abused by those inquirers.
I do not know if you have any connection with former Dilworth students or anyone else relevant to the issues but assume not or you would surely have made an appropriate disclosure.
You may or may not be aware that a small hard core of Old Boy critics (not all of whom were abused) have been calling for the school to be closed and the proceeds of the trust to be distributed amongst the victims. They are not supported by a majority of victims.
As for your suggestion that compensation should be proportionate to the assets of the organisation which employed the abusers, I do not hear you say that of the Catholic Church or the NZ government or the Australian government or the Canadian government. Why single out Dilworth for such a suggestion?
You may be interested to know that another former trustee is an admirer of your pieces on economics but, like me, wonders why you have chosen to write on Dilworth.
Yours faithfully,
Derek Firth
Professor Robert MacCulloch holds the Matthew S. Abel Chair of Macroeconomics at Auckland University. He has previously worked at the Reserve Bank, Oxford University, and the London School of Economics. He runs the blog Down to Earth Kiwi from where this article was sourced.
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