Topics: Cracking down on dodgy child care providers

Warren Moore: In the last financial year, taxpayers forked out $7.5 billion to subsidise the child care system, yet we’re hearing today that a large number of them have been ripping off the system by claiming to care for phantom children. How dodgy is that? These day care providers, they’ve been pocketing subsidies after doing a dodgy swap of kids with their friends. Now, some have claimed the money despite the child or educator being overseas and – get this – some child care providers even have the guts to claim taxpayer subsidies for kids who, well, don’t exist. How brave would you have to be? Or bold, not brave. The Federal Government has stripped or suspended funding from dozens of these fraudsters, but is it the tip of the iceberg? Federal Education Minister Simon Birmingham joins me on the line right now. Thanks for your time Minister.

Simon Birmingham: G’day Warren. Good to be with you.

Warren Moore: Well, it is a bit baffling how so many have got away with this.

Simon Birmingham: It’s a real concern. What we have seen is a really poor culture develop in isolated pockets of the family day care sector, and that culture has been exploiting taxpayers and ripping off the system. And the action we’ve taken over a period of time is across a number of fronts. The Turnbull Government has firstly really cranked up compliance checks which were around the 500 mark when Labor left office a few years back. We’re now conducting close to 4000 compliance checks annually, and that is of course enabling us to identify wrongdoers, to refer some of them on to the federal police, and to see prosecutions occur and to see dozens pushed out of the system. We’ve also tightened the regulations in a range of ways. So this practice of child swapping that some people were engaged in has now been outlawed completely so that we can make sure that if anybody tries to do that we are able to throw the book at them. And we’ve been pleasingly working very cooperatively with the Berejiklian Government who have really lifted the game in New South Wales in terms of assessments of the quality of services, which is a very important thing in terms of not only around compliance, but also giving parents and families and the community confidence that these are actually high-quality services, providing good care and quality education to our youngest citizens.

Warren Moore: Well, call me naïve on this, and I’m only going off the facts presented today – I don’t have any great knowledge of child care facilities – but to say surely it would be the case, if somebody applies for these subsidies, that there would be the checks and the inspections there and then before they got a dollar.

Simon Birmingham: So the state regulators let people into the system, is the first threshold. Under the child care arrangements that have been legislated for many years now, that historically provided, once let into the system, an automatic entitlement for parents to be able to claim the child care benefit or child care rebate for kids who were going there, and really the Federal Government’s hands were tied. We’ve again made changes there, that the whole new child care system and child care subsidy we’re bringing into place in the middle of next year has been implemented, and implemented with powers brought forward for us to be able to suspend the approval of new services at the federal level as well, so that we’re not reliant on states and
territories being effective gatekeepers. Although, as I said, the work in New South Wales has actually seen the number of family day care services shrink from 419 down to 295 – a clear demonstration that authorities there have really come to the party in putting the clamp on people who just aren’t up to standard.

Warren Moore: Well, that’s in New South Wales. We’re also on air through 4BC in Brisbane, and through Canberra for that matter as well. Is it just a state-by-state proposition, or have you only been able to work out a workable relationship with New South Wales?

Simon Birmingham: Look, we see problems that have existed across the country, and services have been suspended or cancelled in all states and territories. It has been more acute in the bigger states, but I’m pleased to say New South Wales is running rings around Victoria in terms of addressing the issue, bringing down the number of family day care services and providing a better outcome in that regard. We’re obviously calling on Victoria to really lift their game and to make sure that we can have the same degree of confidence that every taxpayer dollar that is being used is being used genuinely for the care, wellbeing, and education of children.

Warren Moore: Can’t you get the stick to the state governments and say, look, if you don’t bring in the system that we want you don’t get the money?

Simon Birmingham: Well, the money is actually provided on behalf of parents. So it’s not funding that goes to the state government per se, it’s funding to help hard working Australian families and parents to be able to meet their child care costs. And again, the overhaul we’re applying to the child care subsidy starting from next year is one where child care benefits will be much better targeted. People will have to meet an activity test to be able to receive them, which means that you’re actually working or studying or volunteering, actively participating in society – particularly working being the core part of that activity test. It’ll be better geared so that the greatest support goes to people who are working the hardest amount, the longest hours, but earning the least amount of money to support their involvement in the workplace. But it is a payment that supports families in the subsidy of their fees there. With the states and territories, I guess what we’re undertaking here – and we’ve done it very publically today – is to put maximum pressure on them for their assessment and enforcement regimes to be brought up to standard. Of course, federally we’ve taken it very seriously, tightened a lot of laws as I say, increased by more than sixfold the number of compliance checks that we undertake and are relentlessly driving people out of the system. We have had successful prosecutions; there are people in jail as a result of defrauding the child care system.

Warren Moore: I’ve got to leave it there because of news, Minister, but thank you for your time. Federal Education Minister Simon Birmingham.