Alice Neville at the The New Zealand Herald has obtained figures released under the Official Information Act which show $3,183,423.08 was spent on company credit cards in the past six months.
However, their maths is misleading:
“More than half of TVNZ’s 900 employees are issued with credit cards, with the average monthly spend almost $11,000. The total spending of chief executive Rick Ellis, the chief financial officer Rodney Parker, head of advertising Dave Walker, head of programming Jane Wilson and head of news and current affairs Anthony Flannery was $88,000 over the six months.”
They have used the mean expenditure rather than the median which is standard for skewed distributions (house prices, incomes etc). If you have a couple of people who spent a huge amount, it skews the mean up higher, whereas the median shows what half the people spend below and half spend above.
This is made even more clear when only 52 of the more than 450 credit cards issued by TVNZ have the ability to spend more than this “average” of $11,000. The leading execs at TVNZ spent an average of less than $3000 each per month.
Obviously, some cards are used for group bookings for travel and so on (two cards are capped at a level of $100,000).
What would make more sense is to see the long-term trend for how much money TVNZ is spending on company credit cards – perhaps the last six months was down on the previous six months, or on the year before. Broader context is vital when pulling out figures like this.
The only reference figures we’re told are the peak in this six months period ($608,847, November) and the low ($267,166, January). I’m sure credit card companies always show figures like this: spending goes up at the end of the year and are low at the start of the year. Why would TVNZ be any different?
It doesn’t take a rocket scientist to figure out that there are plenty of things that our state broadcaster could be doing better. Managing their expenditure better would definitely be one of them.
However, if you are going on a witch hunt, can you at least use the right maths?