This childcare chain has been mired in scandal. The CEO’s pay went up

2 hours ago 1

The head of a private equity-owned childcare provider got a bump to his salary despite a spate of horrifying safety breaches recorded by the regulator, including a child being used as a “human mop” to wipe their own vomit.

As community anger grows over fears childcare businesses are placing profit above children’s safety, several chief executives of large for-profit providers were hauled before a NSW parliamentary inquiry on Tuesday into the scandal-plagued sector.

Affinity Education chief executive Tim Hickey told the hearing his base salary was $625,000.

As well as the child being used as a human mop, which happened at Affinity’s Milestones centre in Raby in western Sydney in 2023, other incidents of abuse in childcare revealed this year include workers slapping a baby repeatedly and children forced to drink liquid medicine from a paint cup.

Affinity Education is also at the centre of the sector’s alleged sexual abuse scandal, following allegations that Joshua Dale Brown had allegedly sexually abused children at numerous Victorian centres, including 13 owned by the group. In July, a 21-year-old worker at an Affinity centre in Brisbane was charged with indecent treatment of a child.

The group’s chief executive Tim Hickey told the inquiry they had been investing heavily in safety and compliance at the 250 centres it operates nationally, 102 of which are in NSW.

“I can say, without doubt, that recent events are more troubling than any I’ve seen in this time, and I’m absolutely committed to doing everything within my control to ensure this never happens again, and I accept significant responsibility rests on me as CEO of one of Australia’s largest childhood operators, to ensure that we learn and that we improve,” he said.

Greens MP Abigail Boyd said bonus payments were creating incentives for staff not to report incidents.

He said 90 per cent of Affinity’s centres were meeting the national quality health and safety standards, as judged by the regulator.

But inquiry chair Abigail Boyd painted a very different picture of children’s safety at the NSW centres that Hickey oversees.

She said since 2021, when they were bought by Quadrant Private Equity, the safety breaches recorded per centre was 30 per cent higher than the NSW average. Safety breaches are not recorded on a centre’s publicly available ratings.

“Within three years of that Quadrant ownership, your breach per centre was then 70 per cent higher than the average in NSW. That’s a significant decline in quality and safety in the three years since Quadrant Private Equity bought Affinity,” Boyd said during the inquiry hearing.

Hickey, who said he is paid a $625,000 base salary, told the inquiry that one of his key performance indicators was safety. He indicated he had suffered some financial penalty over the safety breaches but did not specify what that was. He could not say if his bonus, which can be up to 50 per cent of his salary, had been affected.

Asked if his salary and total package had gone up over the past three years, he said: “Yes, it would have gone up.”

G8 Education chief executive Pejman Okhovat acknowledged to the inquiry he received a total package of $3.3 million last year, but that less than half was a base salary.

Okhovat said G8 had a “reporting culture” and denied that the practice of centre directors being given cash bonuses, based in part on low turnover rates, was encouraging staff to not report incidents over fears it could damage a centre’s reputation.

“Occupancy is fundamentally a reflection of the local community trusting and believing that they can put the children in there. If you have a poor reputation, you do not get the occupancy,” he said.

Legislation introduced to state parliament earlier this month will give the NSW regulator the power to require a centre to display its information about any current investigations, while it will see a 900 per cent increase to the maximum penalties applied to businesses that operate more than 25 services.

Sam Page, chief executive of parents and children advocacy group Early Childhood Australia, said there should be increased transparency about incidents at a centre.

“It would come as a surprise if a family saw they were meeting the standards and then had to look for someone else to see if there was a breach of safety or something else. That does not meet public expectations,” she said.

When it came to private equity making money from buying up childcare providers, she said she wanted to see a reduced ratio of for-profit centres across the board as the government moves to expand universal childcare.

“I do think we should be looking at requiring providers to have early childhood expertise on their board, and to be expecting a more modest return on investment, a lower level of profit. And in return, lower risk for their investment,” she said.

Start the day with a summary of the day’s most important and interesting stories, analysis and insights. Sign up for our Morning Edition newsletter.