Taratahi in liquidation just short of centenary

PRESSURE: Taratahi Agricultural Training Centre has found the cost of educating students exceeds the funding the centre receives. The institution has a number of campuses across the country, including Telford in the South Island. File pictures

AGRICULTURE training organisation Taratahi was placed into interim liquidation this week by the High Court, at the request of its board of trustees.

Taratahi, a private training establishment (PTE) and agricultural education provider based in Masterton, employs 250 staff across the country and this year has provided education to over 2500 students.

The organisation owns and manages eight farms throughout the country.

David Ruscoe and Russell Moore of Grant Thornton have been appointed interim liquidators.

“Taratahi faces financial and operational pressures caused by declining student numbers resulting in a reduction in the funding it receives for its educational business,” the liquidators said.

“It invested heavily in student support and learning, while it actively reduced its other operating expenses.

“However, despite both government subsidies and cash flows from its farming operations, the costs of educating each student still exceeded the funding based on its operating model.

“The board considered interim liquidation the most responsible decision to protect the current and future position of its staff, students, creditors and other key stakeholders.”

Board chairwoman Mavis Mullins said it was very distressing for the staff and board.

Taratahi would have celebrated 100 years in 2019.

“Our main concerns are for our students, staff, animal welfare and our creditors and partners,” Ms Mullins said.

Interim liquidator David Ruscoe said the ongoing assistance of the Taratahi board and staff would help ease the process.

“We are working with the board, management, Tertiary Education Commission, New Zealand Qualifications Authority, Ministry of Social Development, Ministry for Primary Industry and other agencies to provide the appropriate support for staff and students.

“Students will be contacted by Taratahi, the TEC and other providers and will be provided with information about the options available to them for continuing their education.

“We understand that wages and salaries are up to date and funds are being received from livestock sales and Fonterra payments to keep the organisation running as per normal over the Christmas break.”

Minister of Agriculture Damien O’Connor said he was saddened and disappointed that Taratahi, a proud agricultural training organisation, had reached a point where its operation was unsustainable. “I am fully committed to primary sector training,” he said.

“We will continue working with industry on a plan to deliver a new approach to agrisector training that meets the needs of the industry now and into the future.”

Minister of Education Chris Hipkins said the timing of the interim liquidation was tough, especially for students and staff.

“Supporting them is our top priority. TEC will work alongside Taratahi, NZQA and StudyLink to ensure students are supported in alternative options. Staff will also be supported through the process.

“Financial problems surfaced at Taratahi in 2014. It was not providing the teaching it was funded to deliver between 2009 and 2014.

“As a result, Taratahi was left with debts of $7.5m due to under-delivery. This is in addition to the significant private sector debt they hold.

“Taratahi has repaid $3.5m of that mostly by selling assets, but this is not a sustainable model,” Mr Hipkins said.

“We are taking steps to secure the home farm and we are talking to providers to fill the gap in provision for students.

“But what’s clear is that the current model of vocational training for primary industry is broken.”

The Minister said the Government was committed to finding a solution that will see continuity of training for students.

“We are looking at new models of primary industry training provision as part of the Vocational Education Training Review.”

AGRICULTURE training organisation Taratahi was placed into interim liquidation this week by the High Court, at the request of its board of trustees.

Taratahi, a private training establishment (PTE) and agricultural education provider based in Masterton, employs 250 staff across the country and this year has provided education to over 2500 students.

The organisation owns and manages eight farms throughout the country.

David Ruscoe and Russell Moore of Grant Thornton have been appointed interim liquidators.

“Taratahi faces financial and operational pressures caused by declining student numbers resulting in a reduction in the funding it receives for its educational business,” the liquidators said.

“It invested heavily in student support and learning, while it actively reduced its other operating expenses.

“However, despite both government subsidies and cash flows from its farming operations, the costs of educating each student still exceeded the funding based on its operating model.

“The board considered interim liquidation the most responsible decision to protect the current and future position of its staff, students, creditors and other key stakeholders.”

Board chairwoman Mavis Mullins said it was very distressing for the staff and board.

Taratahi would have celebrated 100 years in 2019.

“Our main concerns are for our students, staff, animal welfare and our creditors and partners,” Ms Mullins said.

Interim liquidator David Ruscoe said the ongoing assistance of the Taratahi board and staff would help ease the process.

“We are working with the board, management, Tertiary Education Commission, New Zealand Qualifications Authority, Ministry of Social Development, Ministry for Primary Industry and other agencies to provide the appropriate support for staff and students.

“Students will be contacted by Taratahi, the TEC and other providers and will be provided with information about the options available to them for continuing their education.

“We understand that wages and salaries are up to date and funds are being received from livestock sales and Fonterra payments to keep the organisation running as per normal over the Christmas break.”

Minister of Agriculture Damien O’Connor said he was saddened and disappointed that Taratahi, a proud agricultural training organisation, had reached a point where its operation was unsustainable. “I am fully committed to primary sector training,” he said.

“We will continue working with industry on a plan to deliver a new approach to agrisector training that meets the needs of the industry now and into the future.”

Minister of Education Chris Hipkins said the timing of the interim liquidation was tough, especially for students and staff.

“Supporting them is our top priority. TEC will work alongside Taratahi, NZQA and StudyLink to ensure students are supported in alternative options. Staff will also be supported through the process.

“Financial problems surfaced at Taratahi in 2014. It was not providing the teaching it was funded to deliver between 2009 and 2014.

“As a result, Taratahi was left with debts of $7.5m due to under-delivery. This is in addition to the significant private sector debt they hold.

“Taratahi has repaid $3.5m of that mostly by selling assets, but this is not a sustainable model,” Mr Hipkins said.

“We are taking steps to secure the home farm and we are talking to providers to fill the gap in provision for students.

“But what’s clear is that the current model of vocational training for primary industry is broken.”

The Minister said the Government was committed to finding a solution that will see continuity of training for students.

“We are looking at new models of primary industry training provision as part of the Vocational Education Training Review.”

By the numbers

Taratahi was established in 1919.

It owns assets, and manages assets on behalf of others, worth more than $100 million.

It has 62,000 stock units.

It has residential campuses in Wairarapa, Balclutha (Telford), Central North Island Dairy Academy near Taupo and non-residential campuses in Northland, Auckland, Waikato, Bay of Plenty, Taranaki, Manawatu, Hawke’s Bay and Southland.

It has 6125ha of land either owned or leased.

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