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Huge thanks to (resigning) Senator Bob Day

Thursday, October 20, 2016

We were most saddened to receive a publicly-released email from Senator Bob Day early this week announcing his resignation from Parliament. The email makes it clear that the reason behind his resignation was the collapse of his national home building business. His email appears below and gives a detailed explanation of his business circumstances. It includes contact details for anyone affected by the collapse.

Bob Day was the founding President of Independent Contractors Australia in 2000. He was central to the establishment of our vision and our early successes and he was President until 2005.

Bob was key to guiding our advocacy work at the International Labour Organisation in Geneva in 2003 and 2005 where the very legitimacy of being self-employed was under attack. We were successful at the ILO, resulting in the ILO declaration of self-employed legitimacy. This led directly to the passing of the Australian Independent Contractors Act in 2006, a global first we believe.

More recently in his role as a Senator, Bob was instrumental in working to ensure proper laws to protect small business people from unfair contracts. Those unfair contract laws come into operation next month.

For all of this we thank Bob Day for his significant contribution to Australia’s small business people.

Of course, as a result of his business collapse (and as has been commented on in the media extensively), there are people having their homes built through Bob’s company who are suffering. There are tradies and suppliers who are also suffering. Bob has made it clear in his email that he is working with the liquidators to limit the suffering and has put his own assets on the line, including his family home. That is, Bob is not running away from this responsibilities, but doing what he can to repair the damage. This is consistent with the ethical Bob Day we have always known. We wish him success in this endeavour so that the home owners, tradies and suppliers are looked after as much as possible.

Release from Bob Day 17 October 2016

With great sadness I am writing to let you know that earlier today, the Home Australia Group of companies went into liquidation.

The Group includes Homestead Homes (SA), Collier Homes (WA), Newstart Homes (Qld), Ashford Homes (Vic) and Huxley Homes (NSW).

While 4 members of the group all posted a profit in 2015/16, problems and losses associated with Huxley Homes (and the high price paid for the company in 2003), has seriously undermined the Group’s balance sheet and ability to continue trading.
I entered politics in 2013 but in 2015 returned to assist the business and its advisers to either sell it or take on board an equity partner to recapitalise the company.

Since then I have considered a number of proposals from local, national and international groups which culminated in the signing of a contract to sell a 75% stake in Home Australia to Goshen Capital Resources, a company based in the Philippines. Home Australia was one of a number of Melbourne-based deals worth approx $200m in total by Goshen. One of the projects is the $130m Regent Square re-development in Southbank. The funds from Goshen would have provided the Home Australia Group with enough liquidity to trade out of its current difficulties given the more than $100m in forward orders Home Australia has in its pipeline.
As evidence of its ability to complete the deal, Goshen’s CEO Mr Anselmo Nolasco, produced documentation purportedly from HSBC (Hong Kong & Shanghai Banking Corp) Manila to CBA Melbourne (copy attached).

The funds to invest in Home Australia should have been transferred last week but each day there was a different excuse.

After several high level enquiries over recent days it became clear the HSBC-CBA document was fraudulent.
I had based all creditor payment plans and commitments on this deal going ahead.

Given the strict ‘trading while insolvent’ rules that apply in Australia, it would not be possible now for the business to continue operating until another buyer is found.
Having been in business for over 40 years, I am naturally devastated by what has happened and will do whatever I can now to assist those affected by this closure. All homes under construction are covered by Home Owners Warranty insurance.
As I have always agreed to sign personal guarantees to creditors, this closure also has serious implications for me and my family.

Creditor liabilities greatly exceed our assets so we will also lose our family home.
As for my role as a Senator, I will of course resign.
For all those affected by this, the liquidator is McGrathNicol (see contact details below).
I am incredibly sorry for the pain, stress and suffering I know this will cause.
I built my first house in Adelaide in 1979. By 1990 Homestead was SA’s largest homebuilder and has been profitable every year since, for which I am very proud.  But I made 2 big mistakes - 1. Buying Huxley Homes and 2. Going into politics without putting in place a proper management structure for the business.
I will be working closely with the liquidator and offering a proposal to enable me to find a way to pay back every debt fully, no matter how long it takes.

 Bob Day

Leah Sammut
email: lsammut@mcgrathnicol.com
ph: (03) 9038 3141

email: Home_Aust_Customers@mcgrathnicol.com
ph: (03) 9038 3100

email: Home_Aust_Creditors@mcgrathnicol.com
ph: (03) 9038 3100

Parties interested in acquiring the businesses or assets
email: Home_Australia_Sale@mcgrathnicol.com
ph: (03) 9038 3100

Nick Owens
Sefiani Communications Group
0421 977 062
Karen Dunnicliff
Sefiani Communications Group
0435 807 761
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