~ the sweet death knell of ABC Learning

The monstrous entity that is ABC Learning seems at last to be on the skids.

Readers of this blog may recall a couple of posts dedicated to the corporation and its venal progenitor Eddy Groves, and I feel obliged to wind things up with some sort of eulogy

My opinion was, and remains, that something as delicate as early child care should not be run for profit. As I understand it, a publicly listed company must by law attend to the needs of its shareholders before all others – yet the others in this case are very young children in the most formative periods of their lives.

Eddy Groves lived the high life, feeding off this teratological outgrowth of the free market system. He owned basketball teams, luxury sports cars, before, in September, he was at last removed from his position as head of the failing company amid reports of ‘dishonesty’. To my mind, he deserves rotten tomatoes and the stock. A ghastly parasite that would happily fatten itself on our very young ...

ABC’s fall into receivership gives our ostensibly socialist government an opportunity to shift early child care out of the private sector. Sadly, I've heard Julia Gillard say that ‘we are not in the business’ of child care - yet perhaps actions speak louder than words as the Federal Government – albeit of necessity – is providing grants to keep the centres running. We have a government run education system, do we not? What is so strange about extending its boundaries?

Somewhere along the way, it may be discovered that providing good child care at a reasonable price is difficult enough without skimming off the top. Always there will remain the question: should this dollar go to the shareholders or to the children? I caught a news-bite yesterday saying that 40% of the individual ABC centres were unprofitable. It’s curious, as financial overextension has generally been given as the prime reason for the corporation’s downfall. Who knows? Probably, along with the company itself, the structures that generated the appearance of adequate childcare - and they must have been complex – are themselves collapsing. In time, perhaps the receivers will learn the true costs of proper child care ...

Just woolgathering here, I’d like to make clear.

If parents choose a centre run by a company like ABC over a not-for-profit community or council-run centre, they are buying discount child care. The investors expect to be paid off. The skim money has to be found somewhere. That is why, for instance, staff are paid a minimum. In order to restrict expenditure, I am told, ABC centres buy their toys and general supplies from designated providers with whom the company has formed an agreement. One would assume that cost would weigh more heavily than quality in these relationships.

As the company crumbled, I read many articles and analyses. Pundits from the business desk treated it as they would any other company, in those terms. It could have been mining, IT, retail or pharmaceuticals. Where are we as a society, if we include childcare in that lot? Happily, amongst it all, I did hear one commentator question, in general terms, the worth and the morality of corporatised early child care. The Greens have suggested ‘that the government use the opportunity ... to lift child-care standards by running centres itself and turning others over to the community sector.” Right on.

Consider: as our children grow, we have the choice of sending them to private or public schools. If we choose private, it is almost always because we expect a superior grade of education. Imagine taking an ordinary old state school – like Pinewood Primary, where Polly goes – and running it for profit

I was going to suggest, with gladness, that this will be the last we hear of the monster Eddie Groves – but, once the forensic accountants have been through his books, we may yet be treated with the spectacle of his punishment.

~ eddie groves' evil empire
~ an exercise in physiognomy
~ more pernicious mischief from eddie 'the milkman' groves

~ an exercise in physiognomy

The science of physiognomy [or face-reading] has long been discredited, but it retains a certain curiosity value. In my possession I have a book entitled ‘Character Reading From The Face’ by Grace A. Rees M.B.E. The author freely admits that physiognomy is not an exact science, yet feels certain that its use ‘in several ways, is both of the utmost importance and interest.’ Particularly, she says, in the field of vocational guidance.

Samuel Wells, a leading authority on physiognomy, explains its scientific basis. ‘The cranial nerves rooted in the brain, spread, along with muscles, over the face. These nerves and muscles effect and make expressive the facial features.’


Let us then, for interests sake, apply the rules set forth in the book. As I have given much contemplation in these past weeks to the fortunes of Eddie Groves - CEO and founder of ABC Learning, the behemoth of privatised childcare – I shall use him as the subject of a brief study.


First let us regard the overall appearance. ‘When the body is plump, and flesh rather than bone predominates, the Vital temperament is indicated. The body is round likewise the face, neck and chin.’ This seems to clearly apply to the subject. ‘This rotundity denotes vitality, resilience and stability, “Let me have men around me who are fat,” said Shakespeare. Conviviality is the keynote of this disposition.’ But be warned, ‘this temperament needs to have signs of self-control in the features, otherwise love of good living may get the better of the subject, Look out for this in the formation of lips, jaw-line and width of mouth.’

Very well …

Groves’ distinctive mouth does indeed provide a bounty of information. The book instructs us, interestingly, that ‘ a love of money, greed and a desire to hoard will lift the upper lip, exposing the centre teeth – with a decided droop at the mouth corners.’ Groves’ mouth appears to conform very closely here, but the following seems also to have relevance: ‘protruding full lips, loosely closed suggest a boastful disposition, large gustatory desires and unrefined, even coarse, tastes.’

It is said that ‘intemperance, sensuality and unbridled appetites mark the mouth indelibly. Muscles definitely slacken when passions are allowed to sway the whole nature.’

A somewhat short round chin is easy-going, warm in affection but not passionate. There will be a fondness for kissing, a desire for marriage and children.

Much could be discerned from a profile view - the positioning and shape of the ears, the angle of the jawline can be very indicative - but as I do not have access to one, I shall have to work with what I have. Groves does appear to have a relatively weak jaw line. People with weak jaws are 'often the tools of disreputable, bad companions’.

Groves seems to have light bluish eyes. ‘A light blue eye in an adult indicates a nature likely to philander, that is inconstant in attachment and emotionally capricious.’ He is slightly heavy-lidded, which would suggest a reticent, reserved nature; receiving confidences, but giving none in return. The general puffiness of the area and the underlying bags may reinforce the suggestion of intemperance mentioned with regard to the mouth.

His eyebrows are darker than his hair – therefore strong feelings, passionate intensity, force of character and ardour are indicated. Their ruffled nature suggests irritability and quixotism.

Groves’ ‘boxer’s’ nose does not conform to any of the general types described in the text, although a ‘broad base from root to tip shows that the mind is logical, solid and enduring. On the negative side, ‘thickness in the breadth of the nose just above the wings of the nostrils is a sign of acquisitiveness and love of gain.

I am afraid Groves’ lack of wrinkles are not a good sign. ‘Self complacency and self-centredness may save you from having wrinkles. An insipid nature and a frivolous, mediocre mind will not acquire wrinkles until later in life.’ His light hair colour belongs to a demonstrative nature, perhaps with a love of ostentation and fickleness with the opposite sex.

How one combines this information into a meaningful whole is anyone’s guess - but here and there, to my mind, it reveals more than the odd flash of truth.

~ eddie groves' evil empire
~ more pernicious mischief from eddie 'the milkman' groves
~ the sweet death knell of ABC Learning

~ more pernicious mischief from eddy the ‘milkman’ groves

'The board of directors “must act in the best interests of the company as a whole’ with their main task being "to drive the performance of the Company" - ABC Learning Annual Report 2004, p. 32'

And how far down the list of priorities are the children?

Can’t stop myself. Sorry. But it isn’t every day a bone fide capitalist swine meets a sticky end. With his brown winkle-pickers, his Ferrari and his basketball team [the Brisbane Bullets], he is the corporate vulture to end all corporate vultures.

Since my earlier post on the subject, I’ve learnt some more things about Groves’ operation which I just have to share. In Sunday’s Age a financial commentator named James Kirby discussed his fall in a wider context. The piece was far too apologetic for my taste - concentrating on Groves' impact on the business world rather than on our society - but Kirby did point out some of his failings – hubris was the word he used.

In 2003 Fast Eddie sued the child-care union for defamation. It began with his insistence that carers [then on $10, now on $14 an hour] wear uniforms and pay for them themselves. The LHMU [Liquor Hospitality & Miscellaneous Union] reacted with an ‘Uncle Scrooge’ campaign. distributing ‘defamatory’ pamphlets at his centres. Groves spat the dummy, “they made it personal and they are going to regret it. I'm looking for $500,000 in damages.” He refused to meet with the union, and the case, though it did reach the courts, seems to have fizzled out.

In a 2003 article, Kirby wrote that ‘big profits are drawing free-wheeling entrepreneurs into the industry’. One financial adviser commented, 'I'm 77 and the child-care business is the best business I've ever seen in my life. The Government pays subsidies, the parents pay you two weeks in advance and property prices keep going up."

Kirby tells us that ‘diamond miners, dot-com pioneers and real estate agents are getting on board.’ but it does trouble him that due to a lack of appropriate regulation ‘anyone in any business, from cigarettes to strip joints, can buy a chain of child-care centres’. That was four years ago. I wonder if anything has changed? It does tell us that Groves was not the only one with his finger in the pie – he just stole the biggest slice.

Claire Kimball [a ministerial advisor to Howard's Minister for Children Larry Anthony] was quoted as saying. "There is no regulation of ownership and there is no reason to believe there should be."

Astonishingly, the maleficent Michael Kroger [and, for a time, father in law Andrew Peacock] also got involved in the child-care industry. I wonder, would someone like him be in it for the money or the children? Or, a more pertinent question, would you put your children under his care? Kroger’s company Child Care Centres of Australia would up getting into hot water with ASIC and pulling its horns in.

While on the political angle, The Age also draws our attention to the aforementioned Larry Anthony who, after he lost his parliamentary seat in the 2004 election, was appointed to the board of ABC Learning. Anthony was Howard’s Minister for Children. He was instrumental in the creation of the 30% government child-care rebate, which was largely responsible for those ‘diamond miners’ jumping on the childcare milk-wagon. Labor accused him of a conflict of interest. Anthony would give Groves ‘unparalleled access’ to the Howard government. Indeed, I recall reading that a new defence Department building had chosen ABC to manage their in-house crèche.

I have also come across a very revealing 2006 report by The Australia Institute, a left-leaning think-tank based at ANU. It was gratifying seeing many of my perceptions and suspicions given weight by a scholarly paper.

Though there is much disparity in the quality levels of ABC centres, they are generally deficient compared to independent or community based centres. There are poorer staff-to-child ratios. Staff have insufficient time to develop relationships with the children. Some centres have no cleaners, and the staff must pick up the slack, as well as wrangling a large amount of paperwork - leaving too little time for their primary responsibility.

There is often insufficient food or it is of poor quality, or lacking in fresh fruit and vegetables. Qualified cooks are poorly paid. ‘Equipment budgets appear to be adequate but… staff felt limited by the fact that these budgets must be spent at an ABC Learning-owned toy company that does not provide a wide enough variety for programming which is developed for individual children.’

‘Staff were ‘expected to present a professional program without being paid or treated as professionals. A number said that they and other staff regularly complete tasks at home. Some said that they were not paid for set up time, clean up time, or for evening staff meetings. One said that since the introduction of the Work Choices legislation, staff had been told that they were no longer permitted even to claim time-in-lieu for these necessary tasks.’ [Some familiar Work Choices horror scenarios follow].

In my previous post, I quoted many ex-staff members who felt obliged to lie. Something similar crops up here. ‘Staff appear to be discouraged from raising any concerns about the operation of ABC Learning centres outside the company itself.’ The report goes on to suggest that since so much public money is paid to these centres, then the public has a right to know what’s happening in them. They conclude, wisely in my opinion, that the government ‘should consider the wisdom of allowing any further expansion of corporate chains in the long day care sector’

It’s a detailed paper and I suggest you look at it, if you’re interested in the subject. It reports that ‘children are secondary to concerns regarding efficiency and cost-containment’, and warns that if there is pressure on the share price – as there is now - these strictures will tighten.

You may wonder, where did this all start? Who let the dogs out? Well, perhaps you can guess.

‘In 1997’, quoting Kirby, ‘the Howard Government scrapped special subsidies to non-profit child-care centres and in a single stroke, child care was changed. Privately owned and non-profit child-care centres could charge roughly the same fees. Now… the reality of a privatised child-care sector is hitting home.’

I couldn't sleep at night if one my centres was not up to scratch – Eddie Groves.

~ eddie groves' evil empire
~ an exercise in physiognomy
~ the sweet death knell of ABC Learning