By this point you have seen what the TEL Fund actually is and what it contains. You have also seen how the value moves, where the gains occur, and where the losses sit. None of that is unusual for a large investment portfolio. The part that matters most for the community is not the investment mix. It is the governance structure that surrounds the fund and the communication that has followed it.

This is the part that affects public trust.

1. The TEL Fund quietly shifted from internal management to external management

Between 2023 and 2024 the TEL Fund was moved from the council’s internal treasury system into full external management under Forsyth Barr. This was a significant structural change. It meant that the council no longer directly managed the fund. Instead, Forsyth Barr took responsibility for asset allocation, monitoring, trading decisions, currency handling, and portfolio reporting.

Council staff previously handled these tasks while also managing day to day operations. The documents show that the fund had grown too complex for an internal team to manage effectively. The portfolio contained a large number of separate assets including term deposits, borrower notes, direct shares, foreign currency, property, and corporate bonds. It had become a patchwork of unrelated instruments with different risks and maturity dates. Moving to Forsyth Barr was a form of consolidation and modernisation. It was not explained clearly to the public.

2. The TEL Fund was removed from the Treasury Management Policy

The Treasury Management Policy is the document that governs the way councils handle money. It contains rules for borrowing, investing, risk levels, liquidity requirements, and reporting expectations. The TEL Fund was originally included in this policy. At some point it was extracted and placed under a separate Statement of Investment Policy and Objectives. This separation changes how the fund is governed, how its risk settings are determined, and how performance is monitored. It is a major shift. It deserved a clear public explanation but none was provided.

3. The previous model was not low risk

Many residents assume the fund was safer when council staff managed it directly. The documents prove that is not accurate. Under internal management the fund held corporate bonds, foreign currency, direct shareholdings, and a $3 million property investment. It also held borrower notes and multiple term deposits spread across five banks. There was nothing simple about the older structure. There was also a confirmed one million dollar loss on a Ruapehu Alpine Lifts bond that occurred before Forsyth Barr took over. The idea that the old model was safe and the new model is risky is incorrect.

4. The TEL Fund has historically been used to soften rates

Older policy documents show that TEL income was once used to offset general rates increases. This is a key piece of context because it explains why the community often treats the fund like a financial backup or a safety net. It was never purely a long term investment fund. It had an operational role in the past. That historical detail was never communicated well, and it influences how people view the fund today.

5. The TEL Fund must remain liquid enough for disaster recovery

Council policy also requires the TEL Fund to have enough liquidity to contribute during a significant disaster. This means the fund is expected to support the district financially in a crisis. Most residents have never heard this. It is not controversial information. It simply was not communicated.

6. The public narrative did not align with the real information

For years the public was told that the TEL Fund was a ninety million dollar asset. There was no consistent explanation that the fund value fluctuated and did not sit at ninety million in reality. The documents show that the fund value remained in the mid seventies to low eighties during the period disclosed. The fact that it is not a fixed sum and not a stable number was never made clear. The difference between the public narrative and the actual financial behaviour of the fund created confusion and mistrust.

7. Oversight exists, but it is not accessible to the public

The TEL Fund is currently overseen by Forsyth Barr, the Audit and Risk Committee, internal council finance staff, and regular workshops with elected members. The processes themselves are standard. The problem is the lack of clear public reporting. There are no publicly available summaries, no simple quarterly updates, no charts showing the fund’s performance, no explanation of changes in asset allocation, and no commentary on risk. The reporting is functional on the inside but invisible on the outside.

For a fund worth more than eighty million dollars this is not enough.

8. The fee structure was not included in the LGOIMA response

The documents do not show Forsyth Barr’s management fees or transaction fees. This does not imply anything inappropriate. It simply means that the fee structure is not part of the regular public documentation. A transparent structure would show the annual management fee, the brokerage rate, and any performance fee if one exists. None of that was included in the information provided.

9. The property restructuring is a small but important detail

The fund previously held a three million dollar property asset. It was transferred back to council ownership and replaced with three million dollars of cash. This was an internal reclassification. It was not described publicly. It is not scandalous but it is an example of how the public was not walked through the real structure of the fund.

10. The ninety million dollar figure was not malicious but it was outdated

The ninety million figure likely comes from older high points in the fund’s value. Over time that rounded figure continued to be used in public conversations even as the real values changed. It was not an intentional deception but it became a habit that should have been corrected. It contributed to an inaccurate understanding of the fund.

11. What this all means for Taupo

The TEL Fund is legitimate. It is behaving like an investment portfolio. It is professionally managed. It contains a mixture of assets that rise and fall over time. It has oversight. It has rules. It has a defined purpose. There is no evidence of misuse, missing money, or unauthorised activity. The issues lie in transparency and communication.

Taupo residents were given a simplified version of the story. What they received was a rounded number and an overly tidy narrative. What they should have received was clear information about value changes, investment strategy, risk levels, governance changes, and past decisions.

Good governance is not only about correct decisions. It is also about clear communication.

The TEL Fund belongs to the community. The community deserves to understand it without needing to file information requests or decode technical spreadsheets.

With this series, the full picture is finally visible.

Glossary of Terms

TEL Fund
The investment fund created when Taupo sold its local electricity assets in 1995. The fund generates income for community benefit and can support the district during emergencies.

SIPO (Statement of Investment Policy and Objectives)
The rulebook for how the TEL Fund is invested. It sets the limits, risk levels, asset types, and responsibilities for the investment manager.

Forsyth Barr
The external investment firm that now manages the TEL Fund on behalf of Taupo District Council.

Treasury Management Policy
The document that governs how councils handle money, including borrowing, investing, and risk. The TEL Fund was removed from this policy and placed under the SIPO instead.

FX (Foreign Exchange)
Currency movements that affect the value of investments held in other countries. Gains or losses occur when exchange rates change.

RAL (Ruapehu Alpine Lifts)
A company that operated Mt Ruapehu’s ski fields. The TEL Fund held a corporate bond issued by RAL which collapsed and resulted in a one million dollar loss.

Borrower Notes
Financial instruments linked to the Local Government Funding Agency. Councils receive these notes when participating in certain borrowing structures. They mature over time and convert to cash.

LGFA (Local Government Funding Agency)
A government-linked agency that helps councils borrow money at lower interest rates. It issues borrower notes and bonds.

Equities
Shares in companies. These can generate dividends and also rise or fall in value.

Fixed Interest
Investments such as bonds and notes that pay a set rate of return.

Realised Gain
Profit that has been locked in through selling an investment.

Unrealised Gain or Loss
A change in the value of an investment that has not been sold yet. The value can still rise or fall.

Term Deposit
A fixed interest investment with a bank. The money is locked in for a set amount of time.

Impairment
A permanent loss in value. In this case, the RAL bond became worthless and the one million dollar value was written off.

Liquidity
How easily an investment can be turned into cash.

Asset Allocation
The mix of assets in a portfolio, such as shares, bonds, cash, and property.

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Bibliography and Source List

Taupo District Council.
LGOIMA Response: Governance, Risk, and Investment Activity of the TEL Fund, including financial transactions and asset holdings from 2023 to 2025. Received November 2025.

Taupo District Council.
Treasury Management Policy, adopted November 2021.

Taupo District Council.
TEL Fund Accounting Records and Financial Position Reports, including transfers, interest income, FX adjustments, equity gains, and bond impairments.

Forsyth Barr.
Referenced through council documentation as the external investment manager for the TEL Fund.

Taupo District Council Workshops.
Internal workshops relating to the Statement of Investment Policy and Objectives and oversight discussions for the TEL Fund.

Public Records.
Historical context for TEL Fund purpose, use in rate offsetting, and disaster reserve requirements drawn from earlier council policies and reports.