Cancellation of Child Care Benefit Approval: Al-Huda Pty Ltd and Secretary, Department of Education and Training

In this matter before the Australian Administrative Appeals Tribuna,l the question to be decided was whether the applicant’s (Al Huda Pty Ltd) approval as a provider of child care services should be cancelled or some other sanction or no sanction should be imposed. The Commonwealth Department of Education and Training cancelled the provider approval of this Family Day Care provider after it identified non-compliance with the family assistance law, including reporting care when educators or children being claimed for were overseas; child swapping; reporting sessions of care as absences before care for the child commenced and after it ceased; Late reporting of enrolments and late submission of attendance records; reporting sessions of care for children who attended other services when care was reported to have occurred; reporting care that occurred in the home of the child; reporting sessions of care where no-one was eligible to receive CCB or CCR; and receipt of payments that could not be passed on to the relevant individuals and failed to remit payments to the department. The cancellation was previously stayed by the Federal Court (see previous blog post).

The Tribunal concluded that the applicant was not a fit and proper person and that the approval should be cancelled because (para. 194):

• "..the Applicant’s non-compliance shows that it has resulted in significant and multiple overpayments of CCB and is likely to result in significant and multiple overpayments if the approval is not cancelled because of its demonstrated past and continuing fundamental failure of governance and its lack of understanding of its obligations."
• "..the Applicant has demonstrated a reckless disregard for the obligation to comply with conditions for continued approval."
• the Applicant is not a fit and proper person as "the Applicant’s non-compliance with Commonwealth and State laws (the National Law) is serious, frequent and ongoing"; the non compliances demonstrate "...that the Applicant had no, or inadequate, governance arrangements to ensure that the Applicant, its staff, educators, and parents/guardians complied with the family assistance law"; "...the Applicant has a poor record of administering Commonwealth funds because the Applicant has a debt to the Commonwealth, and has on numerous occasions, failed to pass on a fee reduction and not immediately remitted the payment to the Respondent."; "...the Applicant owes a significant debt to the Commonwealth."; "...the Applicant has some experience as a provider but as found above, its expertise is not commensurate with the length of its experience, as demonstrated by its past and on-going non-compliance with and lack of understanding of its obligations under the family assistance law."; and the Tribunal was "...not satisfied that the Applicant's recently adopted and proposed procedures and policies will ensure that it complies with its obligations under the family assistance law."
• "the Applicant’s non-compliance with the educator to child ratio and its lack of knowledge of when, where and whether care took place, as demonstrated for example, by its non-compliance in relation to educators and children overseas and care in the child’s own home, shows that the non-compliance constitutes an unacceptable risk to the safety, health or wellbeing of children being cared for..."
• "...little weight should be given to the recently implemented and proposed policies and procedures because they do not address the fundamental governance problem of unreliable records and evidence from Ms Tlais, which continued to be exposed up to and during the hearing. The policies do not provide detailed procedures. The Applicant has not adopted an obvious measure that is likely to improve the accountability of educators and parents, that is, requiring payment of the gap fee to the provider and not to the educator."