A national agricultural training provider has collapsed after being ordered to pay back $6 million to the government.
Agribusiness Training Ltd went into liquidation two days ago in the wake of an investigation which found it had failed to deliver programmes it was funded for, the Tertiary Education Commission said.
The money may not be able to be recovered. NZQA is working to support students and if required, will help make alternative arrangements for their study.
In a statement this afternoon, TEC Chief Executive Tim Fowler said the commission was prompted to take a closer look at Agribusiness in 2014, primarily because of significant sub-contracting arrangements it undertook on behalf of other institutions.
Agribusiness Training Limited was one of six tertiary education organisations selected for a focused review by the TEC in November 2014. That review led to a fuller independent investigation of Agribusiness Training Ltd on the TEC's behalf by Deloitte. No significant concerns were found with the other five organisations.
However, Deloitte investigation found five Agribusiness programmes delivered fewer teaching hours than its NZQA programme approvals specified. Two of these were significantly under-delivered - the Certificate in Land Based Skills and the Certificate in Horticultural Industry Practice.
Agribusiness is a Southland-based private training establishment which offers education and training in agriculture, horticulture, equine, safety and apiculture. It offers courses across the country.
Mr Fowler said Agribusiness knew the rules, and could expect to have to refund tuition subsidies for breaching them.
"The TEC has found in some cases Agribusiness has not provided the teaching it was funded to deliver. This effectively means that between 2009-2014 Agribusiness received $6.24 million more than it was entitled to for the education services it provides."
The situation had been complicated by Agribusiness's decision to go into liquidation on 21 October, Mr Fowler said.
"The liquidation may affect our ability to recover the funding due to us. However we are
obviously most concerned at this point about what the liquidation might mean for current students."
NZQA said the agencies' priority was ensuring students are supported at this time and that there is as little disruption as possible to studies.
" This may be an uncertain time for students and all efforts are being made to keep students fully informed over the coming days," it said.
NZQA was confident that Agribusiness has conducted student assessments correctly and that student qualifications are valid.
The closure follows another incident earlier this year, where a second agricultural college, Taratahi, was also found to be overcharging.
Taratahi has agreed to repay $7,549,000 it received over a six-year period during which it overcharged TEC for courses it delivered. A second breach involved the enrolling of 67 staff in an entry-level programme when little or no teaching took place.
The Taratahi review followed two similar investigations, at Te Whare Wananga O Awanuirangi in Whakatane and Taranaki's Western Institute of Technology, which uncovered nearly $10 million in overpayments relating to incorrectly reported student numbers and course requirements.