Thousands of South Australian families are facing uncertainty after major childcare provider Edge Early Learning entered voluntary administration, although parents are being told that operating centres will remain open and care will continue as normal for now.
KordaMentha's Craig Shepard, David Johnstone and Stacey Clisby were appointed voluntary administrators of the group of companies trading as Edge Early Learning on Tuesday, 25 August.
The administrators are now carrying out an urgent assessment of the company's financial position and working with management and other stakeholders to determine its future.
Around 2,200 South Australian families affected
Edge Early Learning has a substantial presence in South Australia, with 24 services across the state.
South Australian Education Minister Lucy Hood said 21 of those services are currently operating, with around 2,200 families affected by the company's move into administration.
Edge expanded significantly into South Australia in 2022 when it acquired 17 existing childcare centres.
The company's website currently lists 68 centres nationally across South Australia, Queensland and the ACT.
Centres staying open
The most important message for families is that the administration has not resulted in a general closure of Edge centres.
Edge and KordaMentha say centres will continue operating on a business-as-usual basis while the review takes place.
There is currently no change to children's existing care arrangements, centre opening hours or staffing, and families have been advised to continue attending their centre as usual.
The administrators said their immediate focus was maintaining the safe and ongoing operation of centres while they assess the business.
Fees and Child Care Subsidy remain unchanged
Edge says families should also see no immediate change to childcare fees, payment terms or payment dates.
Direct debits will continue to be processed as normal, while Child Care Subsidy entitlements will also continue, subject to the usual government eligibility requirements.
Planned excursions, events and activities are also expected to continue where possible, although Edge says some may be reviewed or adjusted during the administration period.
What does voluntary administration mean?
Voluntary administration does not automatically mean a business is closing.
It is a formal process in which independent administrators take control while assessing a company's finances and considering options for its future.
Edge says the process is expected to take several weeks, during which KordaMentha will review the business and engage with key stakeholders.
At this stage, the company has not publicly provided detailed reasons for its financial difficulties beyond saying the process will allow it to assess its financial position and consider its options.
Administration follows difficult period for some Edge centres
The financial uncertainty comes after a series of regulatory issues involving some Edge services.
In South Australia, the Munno Para West centre was directed to close in April following incidents in which children were left unsupervised.
The Gawler East centre was closed again in July following a serious incident in which a child was served food containing an allergen that the centre was aware of.
Education Minister Lucy Hood said Munno Para West, Gawler East and Elizabeth Park are currently not operating.
She also said around 12 South Australian Edge services currently have various compliance actions applying to them.
There has been no suggestion from the administrators that those regulatory matters caused the company's move into voluntary administration.
What should SA parents do now?
For families whose children attend an operating Edge Early Learning centre, there is currently no requirement to find alternative care.
Parents and carers have been advised to:
- Continue taking their child to their centre as normal.
- Continue paying fees under their existing arrangements.
- Contact their centre director with questions about day-to-day care.
- Watch for further communications from Edge and the administrators as the review progresses.
Edge says families will be updated when significant developments occur.
The South Australian Government and Education Standards Board are also aware of the administration.
Minister Lucy Hood said it was reassuring that services were continuing as normal and encouraged families with concerns to speak with their centre director.
What happens next?
KordaMentha will now examine Edge Early Learning's finances and operations before determining what options are available for the business.
For the moment, the message to South Australian parents is clear: operating Edge centres remain open, childcare arrangements remain unchanged, and families should continue attending as normal unless they are advised otherwise.
Further information is expected as the administrators' review progresses.