SA Premier Peter Malinauskas unveils $15 million plan to save Bedford Group from ‘guaranteed liquidation’

The Premier says the disability not-for-profit was “all over red rover” if it was forced to go into voluntary administration.

Disability not-for-profit Bedford will avoid going into voluntary administration, after a $15 million state government support package was announced by Premier Peter Malinauskas on Sunday that the Premier said had saved the company from “guaranteed liquidation”.

As part of the package, the state government will acquire from Bedford the 39,090 square-metre Balyana site at Clapham, and McGrathNicol has been appointed as restructuring advisers, reporting directly to Bedford’s board – while chief executive Myron Mann has resigned from his position.

Mr Malinauskas said the state government is “very concerned” with the 80-year-old not-for-profit’s financial situation, and that the state government’s intervention would allow time for the federal government to formulate a long-term plan for the future of the company.

Premier Peter Malinauskas MP speaks to media during a press conference for Bedford, flanked by Treasurer Stephen Mullighan, Bedford Chair Janet Miller and Human Services Minister Nat Cook. Picture: Mark Brake

“It’s clear that had Bedford gone into administration tonight, which was inevitable without support, then a thousand people would be losing their jobs,” Mr Malinauskas said.

“It was all over red rover.”

“It wasn’t just administration, it was almost guaranteed liquidation.”

On Thursday, the not-for-profit that employs 1400 workers in South Australia, announced it would be entering voluntary administration following negotiations with the state and federal governments and the National Australia Bank (NAB).

The organisation, which has been in operation since 1945, said it had in recent years been working to separate its business from the reliance on funding models related to the NDIS.

Federal Health, Disability and Ageing Minister Mark Butler said earlier in the week that no federal money would be contributed to help Bedford Group out of its dire financial position until a thorough investigation into how it could “be in this level of financial strife” was completed.

Bedford Industries at Panorama. Picture: Matt Loxton

Federal Minister for Health and Aged Care Mark Butler. Picture: NewsWire / Martin Ollman

Bedford chair Janet Miller said she had offered to step down as chair and was grateful for the work of the Premier and his team, and expressed her sadness at how the situation had affected Bedford’s clients.

“I cannot begin to imagine the stress that these last 48 hours of uncertainty has caused to all of those people, and I am truly sorry for that,” she said.

“I’m so grateful to be able to stand here today, and thanks to the intervention of the state government, to be able to say to all of those workers and clients and staff that we are looking forward to seeing you all back on site at Bedford tomorrow morning.”

Bedford Chair Janet Miller speaks to media with the Premier Peter Malinauskas MP during a press conference for Bedford Industry flanked by Treasurer Stephen Mullighan and Human Services Minister Nat Cook at the State Admin Building. Picture: Mark Brake

Mr Malinauskas said the “only thing that matters” are the people who rely on Bedford’s services, and that the anxiety they’ve had to endure since Thursday would only have been “exacerbated” had Bedford gone into administration on Sunday.

“The state government, even though this is not our area of responsibility, wasn’t going to sit on our hands and allow a thousand people and all their families to have to endure the hardship associated with losing the services that they provided, particularly the employment services,” he said.

The Premier reassured South Australians that Bedford had not been handed a “blank check”.

“We want to make sure that this is actually part of a program to protect the services at Bedford in the short term and then allow for the federal government to step in to set up a plan and at least a contingency for the long term.”

As part of the support package, Mr Malinauskas said prominent SA businessman Bruce Carter had been appointed as the government’s “independent observer” to the Bedford Group board.

Bedford’s CEO Myron Mann has resigned after the not-for-profit was bailed out by the state government on Sunday. Picture: Bedford

CFMEU SA Secretary Dave Kirner said the union supported the government’s intervention.

“We think it’s good that the organisation will continue to operate because it has got itself in a pretty serious jam, and it really does need public support to get out of that jam and get it back on track,” he said.

Mr Kirner said the CFMEU had been contacted by many Bedford employees since Thursday who were concerned that their jobs were over.

“A lot of people have worked there for quite a long time, staff and supported employees, and radical fast change and the brakes going on this hard would have caused a lot of stress and a whole lot of anxiety amongst parents and amongst workers.”

“It is a logical and intelligent decision to give support, to see if the company can then trade its way out.”

He said Bedford “didn’t get it quite right” during their restructure of the company, and that the unions would continue to support workers to ensure they were consulted on the future of the company.

Opposition Leader Vincent Tarzia welcomed the government’s intervention, but questioned why it hadn’t come sooner.

“While we welcome Bedford being thrown a lifeline, the stress for 1400 Bedford employees could have been avoided if the government had acted two months ago,” Mr Tarzia said.

“The state Labor government now needs to come clean on why, just like with South Australia’s harmful algal bloom catastrophe, it hasn’t been able to bring the federal government to the table.”

McGrathNicol will be working on-site at Bedford from Monday morning.