Cancellation of Childcare Subsidy Approval: Hussein v Secretary, Department of Education & Training

The Federal Court recently handed down its judgment in this case which involved the applicant (Abdulkadir Hussain), operator of Super Family Day Care, appealing the decision to cancel its CCS approval. The Commonwealth Department of Education (respondent) decided to cancel its approval based on a number of non-compliances with CCS conditions, including:

• failure to provide complete and accurate reports to the respondent in relation to the care being provided.
• submission of child care service attendance reports claiming that educators were providing family day care services when they were overseas, and claiming that children were receiving family day care services when they were overseas, and failing to bring these matters to the respondent’s attention.
• provision of 4,453 inaccurate attendance reports and receipt of $98,976 in child care assistance fee payments that could not be passed on to an eligible recipient.
• failure to pass on fee assistance payments to eligible recipients as a fee reduction.
• failure to remit moneys to the respondent that could not be passed on to an eligible recipient;
• been issued with an Emergency Action Notice under the National Law, by the Victorian Department of Education and Training, with respect to operating in a manner that posed, or was likely to pose, an immediate risk to the safety, health or well-being of a child or children being cared for by the service.
• failure to demonstrate that it had instituted or could maintain effective governance arrangements to ensure compliance with the family assistance law.

In this case, the applicant sought judicial review of the decision under the Administrative Decisions (Judicial Review) Act 1977 (Cth) claiming that in deciding to cancel the applicant’s provider approval the Department:

• breached s 195H(2), Administration Act and r 52(3)(g) of the Minister’s Rules by failing to consider relevant mitigating factors in relation to non‑compliance.
• breached s 199A(2), Administration Act by failing to have regard to the submissions in relation to mitigating factors made on the applicant’s behalf.
• denied him natural justice.

The Court dismissed all three grounds and ordered:

1. The applicant’s amended originating application dated 11 March 2020 be dismissed.

2. The applicant pay the respondent’s costs, such costs to be taxed in default of agreement.

3. On the undertaking of the applicant given through his counsel to:

(a)  write to the parents of each child who is currently enrolled to receive child care services provided by Super Family Day Care by Friday 22 May 2020, to notify them that:

(i) the Federal Court of Australia has dismissed the applicant’s challenge to the lawfulness of the respondent’s decision to cancel the applicant’s child care provider registration, and

(ii) Super Family Day Care will cease providing child care services as a registered provider on 19 June 2020, which will have the effect that parents of children using any child care service provided by Super Family Day Care after that date will not be eligible to receive Child Care Subsidy.

(b) provide copies of all such letters to the respondent’s legal representatives by 26 May 2020, 

the effective date of the respondent’s decision of 19 December 2019 to cancel the provider registration of the applicant be stayed until 4.00 pm on 19 June 2020.