A young man will be about $60,000 out of pocket after his first attempt to start a business failed, through no fault of his own, he says.
Automotive technician Matt Cain has closed the doors to Cainz Mechanical Services after receiving advice last month the NZ Transport Agency (NZTA) was proposing to decline his application to inspect vehicles and issue warrants of fitness.
NZTA gave Mr Cain 40 days to submit on its findings. But Mr Cain said it was just too late, he no longer had time.
He said it had always been a dream to run his own workshop and he jumped at the chance in June last year to buy plant and rent a workshop.
“When I saw this, I thought gee, it’s a no-brainer – the gear is there, it’s on the main road, it will do well.
“You’re probably not going to get a cheaper start than that,” Mr Cain said.
He talked to the bank and the accountant about the opportunity and all agreed the business needed to be able to complete warrant of fitness inspections to be viable.
In order for a workshop to issue a warrant of fitness, the mechanic needs a vehicle inspection certification (VI) and the business needs to be certified with an organisation authority certification (IO).
The 22-year-old had held a VI previously, but it had lapsed in the two-year period he had worked on tractors.
When Mr Cain spoke to a representative from NZTA on the telephone in June he was assured when a certifier visited the workshop the two certifications he needed could be completed at the same time.
“They said it wouldn’t be a problem, it would all go through pretty much at the time I’d be opening.”
To update his skill base, Mr Cain completed a WOF training course at Otago Polytechnic.
He submitted his application in August and started the business in October on the basis that becoming a WOF certified business would go ahead with no hassles.
He understood he would hear back in 40 days whether the application had been successful, but months passed with no reply.
Finally, in late January, after not receiving a decision on his application despite numerous calls, Mr Cain approached New Zealand First List MP Mark Patterson for help, and two days later NZTA sent him a letter advising they were proposing to decline his application.
The reasons why did not seem to stack up with the telephone conversation he had in June, Mr Cain said.
“Pretty much their reasons were I was going to be a sole trader and I didn’t have my VI.
“They’re trying to say I’m incompetent in business and as a mechanic, yet they haven’t actually come to see me.”
The reason was also given Mr Cain had a criminal conviction.
“I’ve only got a seat belt fine.”
If he had been granted Wof certification his business would be flourishing now, he said.
“I’m turning down two warrants a day on average, and at Christmas time it was three or four I was turning down.
“It would be a humming little workshop right now if I had it.”
Mr Cain made the difficult decision to finish the business.
“I’ve had to close shop because I wasn’t going to get through the winter without [Wof inspections income].”
It had cost him about $60,000 to set up the business and while he would recoup some of the money, expenses such as signage were unrecoverable.
Even if NZTA granted the certification now he believed it would be too late for him to salvage the business.
“It’s all been one big learning curve.”
An NZTA spokesperson said a notice of proposal to decline Mr Cain’s application was sent to him on February 4 and he had until March 7 to make a submission.
“This proposal set out the transport agency’s concerns and invited Mr Cain to make submissions to the proposal before the agency made a final determination,” the spokesperson said.
The Wof training course Mr Cain completed related to his application for appointment as a VI.
“This is a requirement for that application, but not for the IO application.
“Mr Cain was advised it could take in excess of 40 working days for his IO application to be considered.”.
Since October last year, the group had been taking a much tougher enforcement approach to regulatory compliance.
“We are committed to ensuring that those carrying out vehicle inspections and certifications have the appropriate background and qualifications to do so.”
Anyone applying for appointment as an inspection organisation was strongly advised to read the information on the agency’s website about applying before submitting an application and to seek independent legal advice before making an application, the spokesperson said.