4BC with Patrick Condren - Family Day Care compliance

  • Assistant Minister for Education

PATRICK CONDREN :      Now, family daycare providers will be targeted after a Federal Government investigation found assistance for low-income families is being wrongly claimed for by childcare providers, who are charging the government up to $100 an hour. Low-income parents, who are studying, looking for work or training, receive extra childcare subsidies and pay 50 cents an hour for care. The rest of the cost is picked up by the government.

Sussan Ley is the Assistant Minister for Education; Minister thank you for your time this morning.

SUSSAN LEY:         Morning Patrick, good to be on your program.

PATRICK CONDREN :      It is, it's terrific for you to be on my program, in fact. What exactly are you going to do?

SUSSAN LEY:         We're increasing compliance, we're making sure that providers and the very few parents involved who do the wrong thing - and let's remember, this is only a small proportion of the whole - that we have a crackdown. Because this is a very generous program that supports - as you just said - principally women on income support, get them back into the workforce, so they would pay 50 cents an hour for their childcare while they're studying. And it's important that this fee is not rorted. But it has been, as you correctly identified, quite badly rorted by some, few, bad eggs in the past. So, we're cracking down on this. We've got to make sure that this part of our budget is responsible and that we live within our means, just as we have in the overall Budget.

PATRICK CONDREN :      So how many people are rorting the system?

SUSSAN LEY:         Look, not a great number, and obviously while people can technically stay in the rules, there's a problem. So we're ramping up our compliance, and making sure, by having the sort of checks that we are now going to increase, that those people are not slipping through a loophole. But look, I'd also encourage parents who are receiving this support to check their statements. Because while they know they only pay 50 cents an hour, they may not be sure what their provider is charging. So we're bringing this program back so that we can manage it responsibly. And most importantly, we can support the parents that need it, parents that are finding their way back into the workforce from a welfare payment and other forms of income support. We want to help them get a job and we want their children to be properly looked after and educated while they study and learn.

PATRICK CONDREN :      Will this target women who might be using daycare and not working?

SUSSAN LEY:         That is part of, I think, the rorting in the system. I understand that some women do enrol in a course and then don't turn up, and that's part of the active compliance that we're going to continue to do. Because, these places are generously supported by the taxpayer, and they need to be going to the people who are actually using them to learn and to study and to find work. Wherever you find rorting like this; and remember that the Labor Government knew this was happening, they watched the Budget balloon by $28 million in their last year in office, they sat on their hands. We're actually fixing this up.

PATRICK CONDREN :      So, how much would you save by this crackdown?

SUSSAN LEY:         All that we're saying is that for a parent using this type of fee support, it's got to be 36 hours a week, and no more, and the total fee has got to be $8 an hour. So, we'll see how much that saves, I think it will be a lot. But remember that the average...

PATRICK CONDREN :      So how much are you hoping to save then, you must have done those sort of numbers?

SUSSAN LEY:         Well we're bringing the budget back under control, and making sure that we...

PATRICK CONDREN :      Yes I get that, but how are you - by how much? So how much are you anticipating saving by this crackdown?

SUSSAN LEY:         Well we know that it blew out by $28 million under Labor...

PATRICK CONDREN:       Yes I know that, you've said that. You've said how much it blew out by...

SUSSAN LEY:         Well we'll be saving 28 - we'll be saving $28 million a year, by undergoing this approach.


SUSSAN LEY:         Because that's how much it blew out. I mean it's a demand-driven program, so people were using it, and using it in an unlimited way. And the more people - you know, if you wanted to access it, you could, and what Labor did was simply borrow in order to fund it...

PATRICK CONDREN :      So what do you have to do to access this particular scheme?

SUSSAN LEY:         You have to enrol in an education program, so enrol in a course, perhaps at TAFE or university, and then produce your enrolment papers at the childcare centre, and then basically, you could access the scheme. Now the way it was being rorted was there was a loophole that said if a type of care... the same type of care was provided for the same price for a certain group of people, the provider could charge whatever they liked. So, these are not regular providers, these are not the long daycare centres we all know and love, these are dodgy providers and they were doing the wrong thing.

But it wasn't always the case that the person using them knew that the total fee that they were then on-charging to the government for this type of care was as high as it was. So, it was, if you like, when I say a demand-driven program, it was unlimited. Every time it blew its budget, the Labor Government just topped it up. We said, this can't go on, we've got to bring it back within limits, so that's $28 million back from where it was, in order that we don't irresponsibly spend money that we don't have.

PATRICK CONDREN :      Will this have an impact on the number of daycare places that are available?

SUSSAN LEY:         It won't have an impact, I don't believe, on those who want to use this responsibly. So, 36 hours is at least... I mean, 36 hours a week, if you're studying, is generous, because the average childcare usage is 24 hours a week. Eight dollars per hour is generous, because the average childcare charge is $7.50, so we can't just say: here's a program, go hell-for-leather, spend as much as you like...

PATRICK CONDREN :      Sure, sure, sure, I get that, but will there be a follow-on impact on the number of daycare places that are available? Because that is an issue.

SUSSAN LEY:         I don't believe there will be, because once you limit it to 36 hours per week, and $8 an hour, it brings it back within its means. But I mean, we can't say exactly how many people will use it, all I know is that I want to see those - generally it's women - who are genuinely finding their way back into the workforce and using this program responsibly and properly are the ones that we should be supporting. So, by ramping up our compliance, we're tackling the dodgy providers that unfortunately have been let go in the system for too long.

PATRICK CONDREN :      Okay, Assistant Minister, thank you for your time this morning.

SUSSAN LEY:         Thank you Patrick.

PATRICK CONDREN :      Assistant Minister for Education, Federal Education, Sussan Ley. Do you... what do you think of this crackdown? Are you someone that might be impacted by it? Family daycare providers will be targeted in a crackdown on childcare providers who are charging the government up to $100 an hour; $28 million a year, cracking down on this particular rip-off. Will you be impacted? You will have heard the Minister say that some women who aren't working and aren't studying might lose their daycare. Interesting, interesting. Give us a shout, 13-13-32 or send us an SMS 0427-13-13-32. It's 20 to 10.

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