This case, heard by the Administrative Appeals Tribunal of Australia, related to a review of the decision by the Commonwealth Department of Education to cancel the Child Care Benefit approval of It All Starts Here Family Day Care Scheme Pty Ltd (applicant) under A New Tax System (Family Assistance) (Administration) Act 1999 (Cth).
The Tribunal had to consider two issues in this case (para.3):
- Whether
the applicant failed to comply with the conditions of their
continued approval as an approved child care service under the family
assistance law; and
- If so, whether the non-compliance justified the cancellation of their approval.
The Department argued that the conditions were not met by the applicant due to a number of breaches of the family assistance law and the National Law and Regulations (para. 15):
- Attendance records submitted for dates when children were overseas.
- Attendance records submitted for dates when educators were overseas.
- Attendance records submitted outside the timeframes prescribed in the family assistance law.
- Attendance records showing enrolments reported outside of the timeframes prescribed in the family assistance law.
- Attendance records showing sessions of care that overlap with sessions reported by other services.
- Attendance
records reporting sessions of care where either the child had not
commenced, or had already ceased to use the service.
- Attendance records showing that the Applicant exceeded its approved educator limit of 40 educators.
- Attendance
records reporting more than the permitted limit of no more than four
preschool aged children at any one time, and reporting more than the
permitted limit of seven children limit at any one time.
The Tribunal after examining all the evidence affirmed the decision to cancel approval, stating that:
The applicant accepts that the non-compliances are a
serious issue but that it has introduced steps to mitigate the errors as
already outlined above in these reasons for decision. At hearing, the
applicant stated that there was a drop in incorrect reporting during the
period April 2017 to July 2017. The applicant also identified there was
a significant drop in educators’ absence, late reporting, late
enrolments, overlapping, educator limits, educator child ratios, and
absences.
At hearing the applicant submitted
that it had been frank in conceding issues and had taken steps to enter
into a payment arrangement with the respondent. Although it has not had
an opportunity to test the measures it has put into place to address the
identified breaches, the applicant contends that these should still be
taken into account. The applicant further submitted that it has already
suffered a significant suspension and that cancellation was not an
appropriate sanction.
In regards to a number
of the breaches, the applicant appears to place responsibility on staff
members and educators. As the operator, the applicant cannot excuse
itself from responsibility for non-compliance with its obligations by
pointing to the actions of educators or other staff members. The
Tribunal has accepted in similar cases that the obligations imposed on
the operator of a child care service cannot be avoided or excused by
blaming others, including its own staff; see Moonlight Family Day Care Pty Ltd and Secretary, Department of Education and Training [2018] AATA 2706 (7 August 2018); and Sunrising Family Day Care Pty Ltd and Secretary, Department of Education and Training [2018] AATA 1463 (28 May 2018).
Section 195A of the Administration Act,
as it stood at the relevant time prior to 2 July2018, operates to ensure
that where an obligation, including a condition for continued approval,
is imposed on an approved child care service, “it is taken to be
imposed on the person operating the service”. This means that all
obligations under the family assistance law were ultimately obligations
of It All Starts Here Family Day Care Scheme Pty Ltd, acting through its
officers, staff and agents, including its educators.
The
applicant’s breaches are not minor. The misreporting of thousands of
sessions of care is an extremely serious matter and demonstrates a lack
of care and compliance with a number of legislative requirements under
the family assistance law. Through its non-compliance with its
conditions for continued approval, the applicant received payments of
public funding that it should never have received. Further to this, the
applicant, by breaching educator-child ratios, provided child care in
circumstances where it was not lawfully allowed to provide such care,
giving rise to risks for the safety, health and wellbeing of children
under the applicant’s care.
In the
circumstances of this case, I am satisfied that cancellation is the
appropriate sanction. The health and safety of children and the quality
of the care provided is of paramount concern. Should the applicant’s
approval not be cancelled there is a risk that any children in the care
of the applicant may not be appropriately cared for given the systemic
failure of the applicant to oversee the level of child care that it held
approval to provide. This is of particular concern in regards to the
breaches concerning educator to child ratios. While I do acknowledge
that that applicant was frank in conceding the breaches identified and
has plans to address the issues in the future, these measures have not
been tested. The breaches identified are egregious and highlight that
the applicant’s governance arrangements are systematically flawed. For
these reasons I find that the applicant is not a suitable person to
operate a child care service (paras. 34-39).
