As Edmond
Groves swans around the US trying to flog off bits of his
failing empire, mums and dads are getting worried. Now, as it
happens, these mums and dads are also tax payers and, so it
transpires, they have contributed mightily to the fortunes of
Edmond, his missus and a few others in the inner ABC circle.
I found it
rather interesting that in the huff and puff of last week’s
media’s examination of the fall and fall of ABC little attention
was paid to the real issue. That of the privatisation of public
services and goods. That debate, if you follow the silence of
the media, would seem to have been settled years ago.
While I am
all for high quality, low cost child care, I am also for
equitable distribution of wealth and regulation to prevent the
accumulation of wealth by tax payer subsidised, for profit
providers of child care (and a range of other services and
goods).
ABC Learning
has grown enormously over the last ten or so years. The growth
in ABC’s profits and Edmond’s personal wealth can be tracked
alongside the rise in child care subsidies paid from our taxes
to provide a service that was, historically, in most cases,
provided by local councils operating on small budgets with much
parent input and assistance. The few private centres were
reserved for the rich who were adverse to the thought of their
little ones coming into contact with the spawn of the great
unwashed.
Profits are
not that hard to make when one is providing a government funded
essential service. Indeed, the lucrative arrangements the
privateers lobby for ensure that they don’t really have to work
that hard to keep up the payments on the penthouse, planes and
cars. With about 45% or $207 million of the profits of the ABC
centres coming from our taxes we are, I would argue, entitled to
an explanation as to why this is ‘good’. But I won’t hold my
breath.
Little talked
about in the media fracas over Edmond’s diminishing fortunes
last week was mention of the former Howard Government Minister
for Children and Youth Affairs, Larry Anthony. Larry lost his
seat in 2004 and was very quickly invited to join the Board of
ABC. Perhaps this was just a small way to repay Anthony’s
legislative assistance because it was he, as the responsible
Minister, who pushed through the bill that gave hefty subsidies
to parents who were then, under the law, forced to pay that to
the child care provider they “chose”.
However,
“choice” was, in many areas, soon reduced to choosing the
closest ABC centre or the one further away. ABC, if you
remember, was hauled before the Australian Consumer and
Competition Commission, when it successfully tried to take over
the second biggest child care provider, Child Care Centres
Australia. This is where it gets interesting and we see the
nexus between politics and big business revealed yet again.
Child Care
Centres Australia had two high flying liberals on the Board,
Andrew Peacock and Michael Kroger with Peacock the company’s
Chairperson. Now, with Larry Anthony and Former Brisbane Lord
Mayor and prominent liberal, Sallyanne Atkinson on the current
Board of ABC, one wonders how much Edmond is ruing the fact that
through his networks within the Liberal party he successfully
achieved a commitment from the Howard government that, should
they be re-elected, they would pour almost $700 million into
direct child care subsidies. Easy money by anyone’s standards I
would think.
However, that
little earner crashed and burned along with JW Howard on the
evening of November 24, 2007. I suggest that unlike a wise
investor, Edmond had put almost all of his political investments
in the Liberal party and when they no longer guaranteed a steady
income his worm, as they say, turned.
It’s also
worth remembering that Edmond doesn’t care much for the workers
he employs. You might recall that in 2003 and 2004 he fought
against charges that his centres were responsible for the safety
of the tiny tots who attended. No, Edmond argued, if little kids
escape then it’s the lousy staff I employ who should be held
liable. He lost.
Not content
with telling his staff to bugger off and take responsibility, he
wasn’t too kindly disposed to allowing government inspectors to
check he met the rules. With heavy, deep pockets (no doubt full
of taxpayer’s money) he challenged the Victorian government all
the way to the Supreme Court. He lost and the inspectors moved
in.
On both
counts, Edmond truly believes that he and he alone knows what’s
best for the little ones. He denied that cutbacks in staff and
services via orders to reduce the amount of toilet paper
available, reducing lunch sizes and other basic items, would
affect the quality of care his centres could offer. It seems
that flying around on his private jet might have reduced his
ability see the trees for the forest.
And so it is
that Edmond is now jetting around the US trying to do deals to
unload some of his debt and if he is lucky, score a green card
and do a Rupert on us. But that’s not all Edmond is doing. There
is one last card to be turned over as the house of tax payer
funded cards crumbles.
You probably
haven’t heard of a little ‘trust’ fund called “The Australian
Education Trust”. It’s managed by the Directors of Austock
Property Management Ltd. The directors of the “responsible
entity” all come from corporate backgrounds with extensive
interlinkages. Companies with interests in the trust include
Mirvac – you might know of them as the rapacious developers of
once public land and National Australia Bank – who also
bank-rolled Edmond.
In their 2007
Annual Report we find that 97% of the income the trust obtains
comes from, you guessed it, ABC Learning. What is also of
interest is that the profit that ABC provides for the trust is
…, you guessed it, 45% of total profits derived from the trust.
Am I paranoid or is there a pattern emerging here? Tax payers
contribute 45% of ABC profits; ABC provides 45% of Australian
Education Trust profits. Nah. Cant be. But that’s not all. The
2007 Annual report also notes that by 2010 the trust will
“acquire interests in 3 schools in Victoria and New South
Wales”. With such a vertical integration of education being
proposed, it will soon no longer be the state providing ‘cradle
to the grave’ ‘social’ services but private, for profit
companies.
Children, it
seems, are lucrative business investments. As units of
production they are relatively attractive. The main research and
development, along with the clean up of toxic wastes, is done by
the family leaving the profits to be stripped off by the
corporates.
No doubt, as
the creditors close in Edmond will be hoping that Kevin 07 can
ride in and save his bacon. Then again, if Kevin does ride in
and save the day, it will be you and me that contribute directly
to the fortunes of those whose biggest worry is if they have to
sell the Bentley or the Porsche to make to next payment on the
jet.