Staff say company hosted fire sale before collapse
SMARTCITY Vocational College staff have spoken of a fire sale of office goods and furniture in the lead up to the collapse of the college's administrative arm, SC Admin Pty Ltd.
Worrells Solvency and Forensic Accountants were appointed as liquidator on Friday night and Worrells partner Paul Nogueira there was a long process ahead to determine company assets and any money owed after more than 300 staff nationally lost their jobs when SC Admin entered voluntary liquidation.
This weekend the Daily received a number of calls and emails from affected staff, some of whom claim there was a mass sale of office assets, including laptops, furniture and more, at a number of college sites over the past fortnight.
Anthony Loughhead was a business solutions advisor based at SmartCity's Adelaide campus in the suburb of Elizabeth.
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He said his regional manager had been instructed last week to "sell everything he could" that "wasn't bolted down" at the campus.
He said laptops had sold for $150 each, while fridges, coffee machines, desktop computers and more were sold from under students who were still studying at the time.
He said at one point two whiteboards were sold via Gumtree and were rolled out of the room mid-class, wiped down in front of students and taken away.
Mr Loughhead, who started with SmartCity in July, said he was lucky that he received his pay on Friday for two weeks' wages owed to him but he was still owed about three weeks of pay. Other staff from campuses around the country and in south-east Queensland are still unsure whether they will receive holiday pay and other entitlements.
Mr Loughhead said staff had quickly "smelled a rat" when the office supply sales began.
"It's ridiculous, I've never seen anything like it," he said.
He said many students were none the wiser to what was happening.
He described the push for new enrolments and for existing VET FEE-HELP students to "opt in" to continue on the VET FEE-HELP program over the past two-to-three months as "ludicrous".
He said staff were offered incentives to sign up as many students as possible, in the form of daily prize draws.
"It was a running joke. Win an electric toothbrush for signing someone into debt," Mr Loughhead said.
The Daily was advised by college staff there were almost 600 new students enrolled and activated between November 1- December 16, about 400 of those in November alone, with about 3200 SmartCity students registered nationally.
Those new enrolments may have triggered a significant payment from the Federal Government's VET FEE-HELP scheme to SmartCity Vocational College before SC Admin was wound up, as first payments to providers for loans are made about three weeks after students are activated.
Changes to the system will kick in from January 1, meaning current VET FEE-HELP students must opt-in to remain on VET FEE-HELP for 2017, with providers to be paid in arrears for those students on a monthly basis.
VET FEE-HELP loans are similar to university HECS loans, where the student only pays back the loan once they gain employment.
While not his direct responsibility, Mr Loughhead said he'd signed up a couple of students who'd reached out to him, but wished he hadn't after the events of the last week.
"I signed up a couple of people on diplomas as well and if I could take it all back (I would)," he said.
"Hindsight is a wonderful thing.
"I wouldn't go back (to SmartCity, if his employment was to continue or be reinstated)."
He said he was still unsure exactly what his employment status was with SC Admin now in administration, but as far as he was aware he was out of a job.
"I'm unemployed, I've got three kids, a wife and a mortgage," he said, embarrassed now that he'd knocked back a new job only three weeks ago.
He said what had happened was a "shame for the guys who are doing the right thing".
There were multiple reports a number of the college's vehicles had been transferred to Quest College last week, which sources told the Daily was a sister college of SmartCity.
The Daily sent the following questions to SC Admin and SmartCity Vocational College director James 'Jim' Spong, a Parrearra resident according to ASIC documents, who was yet to respond.
Q: Has SC Admin Pty Ltd been placed into administration? When will the company officially be in the hands of Worrells?
Q: Who made the decision to place SC Admin into administration?
Q: Have you or anyone associated with SC Admin or SmartCity Vocational College registered the business or company SC Operations (Aust) Pty Ltd?
Q: Have SmartCity assets, ie office furniture, laptops, computers and more, either been sold or transferred to other companies, particularly, Quest College? Why?
Q: Will all students' courses be honoured and remain ongoing? If students were to quit their course now and opt to go through TAFE, will they owe money to SmartCity?
Q: How many students were enrolled or activated by SmartCity in the last month leading up to SC Admin going into administration?
Q: How much was SmartCity paid by the Federal Govt in VET FEE Help funding this month?
Q: How many staff will remain employed by SC Operations? How many were employed by SC Admin?
Q: Does SC Admin owe money to other stakeholders? ie campus landlords, ATO, etc? If so, how much is owed?
Q: How much money has SC Admin received from the Federal Government in the past 4 years under the VET FEE Help scheme?
Q: Have payments been made by SC Admin to any staff, executive, shareholders, stakeholders prior to it entering voluntary administration? If so, how much was paid and to whom?
Q: Will SmartCity Vocational College transfer its latest VET FEE Help payment from the Federal Govt to SC Admin to pay any money owed?
Q: How many students are currently active/enrolled with SmartCity? (by current-how many that haven't cancelled and haven't graduated)
Q: How many students were recruited and activated from November 1-December 16 this year? How many from November 1-November 26?
Q: What amount did SmartCity expect to be or was paid in December through the VET FEE-HELP Loan program?
Q: On average, what is SmartCity paid per VET FEE-HELP Loan 'census' payment, per student for a standard course?
Q: How many students have been enrolled and activated since November 26 this year but are yet to pass the census date?
Q: How many students have opted in to remain in the VET FEE-HELP program for 2017?
Q: What is SmartCity's graduation rate nationally and on the Sunshine Coast?
SmartCity staff and students have been left in the dark about the future of their employment and studies.
Susette Gane's autistic grandson is one SmartCity student based at Hervey Bay who has been unable to make contact with the college since the events of a few days ago, when college staff were told to go home, although a SmartCity Facebook post has said campuses will recommence operation on January 23.
Ms Gane said her grandson has been effectively locked out of taking part in TAFE or QAT courses as he cannot confirm his studies will continue until at least January 23.
Currently enrolled in a diploma of digital media, Ms Gane said her grandson was told there would be support available when he signed up and no mention of a closure had been made.
She said her grandson was also fearful he may be left with a $20,000 debt for the cost of his course.
A Sunshine Coast charity was also affected, with intellectual and physical disability support service Compass Institute's sensory garden project disrupted due to the cancellation of a Cert III Horticulture course which had eight SmartCity students enrolled and was due to begin in January.
A Coast-based SmartCity staffer said the course was set to deliver the garden to the charity to be used by people with disabilities, but its cancellation had left the garden project's status unknown.
But Compass Institute development coordinator DJ McGlynn said the garden hiccup was not going to significantly impact the charity, describing the project as "a bit of a work in progress" and none of the eight students were Compass members.
He said it was disappointing the course had been cancelled and the events of the past week had taken place, saying the charity had enjoyed a good arrangement with SmartCity and had benefited from the work done, even hiring one of the horticulture students who graduated the program last year.
"It's a real shame that this has actually happened," he said.
Mr McGlynn said the sensory garden project was one they'd like to keep progressing and he said they were open to being involved with other training organisations in future.
Meanwhile TAFE Queensland East Coast has offered to honour eligible students affected by last week's events so they can continue studying in 2017.
TAFE Queensland East Coast general manager Dr Paul Wilson said there were no conditions on TAFE's delivery of education and training and TAFE was automatically eligible to offer VET Student Loans.
He said all students affected by the SmartCity administrative collapse could apply to study at TAFE Queensland East Coast by calling 1300 656 188.
"If eligible we will honour students VET FEE-HELP agreements and transition them into like-for-like TAFE courses (of which there are over 500) so that they can still access VET FEE-HELP funding to complete their studies in 2017," Dr Wilson said.
The Daily understands more than 300 staff have been affected nationally by SC Admin entering into voluntary administration, with SmartCity campuses offering a range of courses in Armadale, Bundaberg, Cairns, Caloundra, Elizabeth, Fairfield, Gympie, Hervey Bay, Hobart, Inala, Ipswich, Kippa-Ring, Launceston, Maroochydore, Morayfield, Rockhampton, Toowoomba and Townsville.
Mr Nogueira pointed out Worrells were only looking after the administrative arm, and urged staff to contact Worrells at firstname.lastname@example.org or email@example.com.
He said affected students should contact SmartCity directly.
Staff owed entitlements can lodge their claims at employment.gov.au/FEGonline or 1300 135 040.