Difficult lessons learned in fight to re-open Telford
Key people in the Telford negotiations who are fighting to re-open the Balclutha-based agricultural institute, say the latest debacle is an exercise in lessons learned.
Tertiary Education Union president Sandra Grey had been working alongside staff since the Taratahi Agricultural Training Centre pay suspensions were made public on Wednesday. She felt strongly that the Government needed to step in. ‘‘Letting the market provide’’ for agricultural training had been a disaster for Telford, she said.
With two failed tertiary providers, a public institution needed to come in and take it over, with a more robust funding structure, she said.
All the parties concerned would be meeting at the Clutha District Council in Balclutha on Monday to make a decision on Telford’s future. ‘‘We need to get the courses running again in the short-term, and talk about what is going to happen in the long-term.’’
What had lately transpired also illustrated that the funding model was broken, she said.
North Island-based Taratahi’s funding woes dated back to 2014 when it was ordered to pay back the Tertiary Education Commission (TEC) more than $8 million for under-delivering courses.
When Taratahi went into receivership in December carrying $23m in debt, it was reported that it had asked the Government for $4m to keep it afloat but had been refused.
Telford also ran afoul of the commission two years later when it was under Lincoln University stewardship and was required to pay back $1.5m in similar circumstances.
New Zealand First MP Mark Patterson, who was playing a key role in discussions with the Government and liquidators, said he acted on the premise that the TEC had already allocated funding for Telford students.
The money should still be used at Telford despite the circumstances, even as an interim measure until a more permanent solution could be found that would enable it to open its doors, he said.
He was confident that the rescue package that he had been involved in could work and would secure Telford’s position. ‘‘It’s very much in the TEC’s court to provide agricultural vocational training.’’
Clutha mayor Bryan Cadogan said all the components of the package were there. In the meantime he was keeping a wary eye on the liquidators.
Seeing assets being reckoned this week made him mindful of what happened when Lincoln University took over Telford in 2011, he said.
He was remembering it ‘‘with renewed bitterness’’.
Lincoln was given $10m from Telford in the merger, but the university had kept the money in the kitty and had not carried out some of its intentions, such as maintenance, or marketing, Cadogan said. In a cost-cutting exercise in 2016, Lincoln shed staff – and Telford, to save $5m.
Documentation from the Lincoln transfer to Taratahi in 2017 showed that when Lincoln University was handed over to Taratahi, Taratahi as the new tertiary provider received a one-off cash payment of about $7.7m. In exchange, Telford got $1 in a ‘‘peppercorn’’ transaction to seal the deal as a way to move forward, Cadogan said.
In addition, Taratahi received $2m in a one-off cash payment, which he understood was in part recognition of the $10m that Lincoln got when it acquired Telford and was meant to reflect deferred maintenance. ‘‘It was expected that Lincoln would have used the majority of the $10m on Telford and then it was also hoped that Taratahi would use the majority of their $2m on Telford. Unfortunately that never transpired,’’ he said.
He said it was yet another example of how Telford’s assets had been ‘‘pillaged’’.
It was ironic that the liquidators were rounding up assets and getting as much as they could when all Telford had got was $1, he said.
Last month, Taratahi had sold off vans two weeks before anyone had any whisper of it going into receivership, he said. ‘‘It’s a continuation of that first instance of how Telford has been treated.
‘‘But Telford is still Telford. It could still operate on a stand alone basis and still be profitable and viable, and always has been, but it has been financially enfeebled by first Lincoln and then Taratahi.’’
The Telford Farm Board retained ownership of the two farms and the campus land, which Taratahi leased from the board.
The Southern Institute of Technology had been tipped to take over. SIT chief executive Penny Simmonds said on Wednesday the institute was waiting on direction from the liquidators.