The retail business of Canberra's troubled Yarralumla Nursery will be sold to private owners as the ACT government moves to restructure the loss-making enterprise.
Customers at the historic government-run nursery have been told gift vouchers for the garden centre will not be redeemable from December, while the small tree farm at Pialligo is slated for closure on August 31.
Territory and Municipal Services Minister Shane Rattenbury said on Thursday no full-time job losses were expected from the nursery's 25 permanent staff and the popular free plant issue scheme would continue.
The Pialligo farm land will be returned to the Commonwealth government next year in preparation for runway extensions at Canberra Airport. Mr Rattenbury said the changes would improve the viability of the heritage-listed nursery before its centenary next year.
A 2011-12 annual report found the nursery contributed to a $7.8 million loss from three government-run businesses, including the Capital Linen Service and the ACT Property Group. The nursery sought increased financial assistance from the ACT in 2010. Mr Rattenbury said the sale was expected to be concluded by next year.
"The drought of the last decade, along with competitive pressures, mean the nursery needs to re-position itself to ensure it continues to play an important role in the history of the ACT," he said.
"The nursery will return to its original focus of being a wholesale nursery which provides cool-climate plants for Canberra's public parks and streets as well as to landscaping contractors and retail outlets in the surrounding region."
He said disability employment and vocational programs would not be affected by the changes.
Last year, a Fairfax Media investigation revealed years of alleged mismanagement at the nursery was costing taxpayers millions of dollars as the operation was overhauled by new management.
More than 130,000 plants and trees worth $1.5 million were found to have been destroyed as water run-offs from the property reached Lake Burley Griffin and 18 heritage-listed glasshouses posed safety risks.
A staff member was dismissed after being found to have committed six breaches of the Public Sector Management Act, including misuse of a government credit card and mobile phone, and inappropriate sale of a government vehicle.
In October last year TAMS Business Enterprises executive director Phillip Perram said the nursery remained viable and would return to profit by next year. He called a September 2011 audit of financial and business practices conducted by consulting firm Oakton a ‘‘wake-up call’’.
The struggling business lost $1.2 million in 2012-13 and is on track for losses of about $500,000 in the current financial year.
The ACT government blocked the release of the audit because its findings would undermine the entire business.
Other elements of the current plan include improved plant propagation techniques, new sales and production and onsite improvements.
“The changes to the nursery’s operations will reposition the nursery for hopefully another 100 years of service to the greater Canberra community,” Mr Rattenbury said.
Owner of the adjacent Yarralumla Gallery and Oaks Brasserie Mira Bogojevic said she was only told of the plan after Fairfax Media sought confirmation from the ACT on Thursday.
She said stakeholders needed more information about the plan.
‘‘It will be better for government because they will get rent and this should bring some more people here hopefully.
‘‘I haven’t seen any detail. The only thing I know is that the business is for sale but I also need to see what they are bringing.’’
The first government nursery was established in about 1911 at Acton before horticulturist Charles Weston recommended its relocation to Yarralumla in 1914.
with Ewa Kretowicz