House of Representatives

Explanatory Memorandum

(Circulated by the authority of the Minister for Families, Community Services and Indigenous Affairs, the Hon Mal Brough MP)

Schedule 3 - Miscellaneous amendments

Summary

This Schedule contains a number of amendments to various provisions of the Family Assistance Act and the Family Assistance Act Administration Act. In large part, the amendments relate to the information gathering powers, the location of records, and the fee charging practices of services. The amendments also enable the Secretary to write directly to the parents of children at child care services that are not complying with their obligations under the family assistance law, to suspend immediately the approval of a service in certain limited circumstances, and to establish committees for the purposes of the family assistance law.

Further amendments will reduce overpayments of CCB occurring because an individual who is eligible for CCB for a child has delayed notifying the Secretary when the child starts attending primary school, improve the recovery of debts owed by child care services operated by unincorporated bodies or associations (such as partnerships), limit the fees charged by services in certain restricted circumstances, limit the retrospective approval of a child care service and standardise the appeal period for certain decisions affecting services.

(a) Definition of ' school child'

Background

An individual's rate of CCB is worked out using Schedule 2 to the Family Assistance Act and equals the individual's standard hourly rate (worked out using clause 4 of Schedule 2), multiplied by the individual's 'adjustment percentage' (worked out using clause 2 of Schedule 2). An individual's adjustment percentage equals 'CCB % × schooling % × part-time %'.

Under subclause 2(2) of Schedule 2, the schooling % is 85% if the child is a school child and 100% if the child is not a school child. Subsection 18(1) of the Family Assistance Act defines a school child as a 'child [who] is attending primary or secondary school'.

Under subsection 56C(5) of the Family Assistance Administration Act, a conditionally eligible individual is required to notify the Secretary if anything happens that causes a reduction in the schooling % to 85%. Therefore, individuals are required to notify the Secretary if the child in respect of whom they are eligible for CCB starts school.

To reduce overpayments of CCB in situations where an individual does not notify the Secretary when their child starts school, or when there is a delay in notification, this Schedule will make amendments so that a child will be taken to be a school child when the child turns six years of age, unless the individual notifies the Secretary otherwise.

Explanation of the changes

Item 1 inserts a new subsection 18(1A) into the Family Assistance Act, which provides that a child is taken to be a school child if the child has reached six years of age, unless an individual who is conditionally eligible, or eligible, for CCB for the child notifies the Secretary that the child does not satisfy the criterion in subsection 18(1).

(b) Immediate suspension

Background

Section 200 of the Family Assistance Administration Act provides that the Secretary may sanction an approved child care service when the service has not complied, or is not complying, with a condition for continued approval. The Secretary must give the service notice of an intention to sanction the service and invite the service to make submissions stating why the service should not be sanctioned. The consequence of suspension for an individual is that the individual is not entitled to CCB for care provided while the service is suspended (section 50, Family Assistance Act). The consequence of suspension for a service is that the service must cease to provide fee reductions to individuals who are conditionally eligible while the service is suspended (section 219D, Family Assistance Administration Act).

The amendments provide for the immediate suspension of a service's approval in certain circumstances. A service's approval may be suspended immediately if it fails to comply with all the requirements imposed by Commonwealth legislation, or State or Territory law relating to child care; if the care provided by the child care service results in an imminent threat to the health or safety of a child; or where, in urgent circumstances, it is no longer appropriate for the service to provide child care.

There are also consequential amendments to various provisions, which clarify the effect of suspension on individuals, the effect of suspension on services and the date a notice of suspension may come into effect.

Explanation of the changes

Part 1 - Amendments

Item 2 amends subsection 50(1) of the Family Assistance Act by omitting the words 'section 200 of'. The effect of this amendment is that, where the approval of an approved child care service has been suspended under section 200, 201A or 219TSQ, the individual is not eligible for CCB for sessions of care provided during the period when the service's approval is suspended.

Item 12 amends subsection 144(1) by inserting two new paragraphs (da) and (db). Paragraph (da) provides that a decision made under subsection 201A(1) to suspend the approval of an approved child care service may be reviewed by the Administrative Appeals Tribunal. Paragraph (db) provides that a decision made under subsection 210A(3) to revoke the suspension of a child care service may be reviewed by the Administrative Appeals Tribunal.

Item 20 is consequential to the amendments made to paragraph 195(2)(b) by item 21 and substitutes 'either' for 'any'.

Item 21 provides for the insertion of new subparagraphs 195(2)(b)(ia) and (ib).

Subsection 195(2) of the Family Assistance Administration Act sets out the grounds upon which the Secretary may refuse to approve a child care service for the purposes of the family assistance law. If a service has previously been approved and the service has been sanctioned under section 200, the Secretary may refuse to approve the child care service.

If a service has been previously approved, new subparagraph (ia) provides that the Secretary may take into account a suspension under section 201A (immediate suspension) when determining whether or not a service should be approved for the purposes of the family assistance law.

If a service has been previously approved, new subparagraph (ib) provides that the Secretary may take into account a suspension under section 219TSQ (suspension after being given 10 infringement notices) when determining whether or not a service should be approved for the purposes of the family assistance law.

Item 23 amends subsection 200(2) by inserting, 'The notice must specify the day, no earlier than the day on which the notice is given, on which the sanction takes effect.'. This amendment will clarify that the date of effect of a suspension under subsection 200(1) does not have to be the date the notice of sanction was given to the service; it may be a later date.

Item 24 inserts new section 201A. New subsection 201A(1) provides that the Secretary may suspend the approval of a service in certain circumstances. The Secretary must give a notice in writing to the service if he or she decides to suspend the approval of a service under new section 201A. The introduction of a power to suspend immediately the approval of a child care service is not a replacement of the power to suspend by sanction under section 200 of the Family Assistance Administration Act. It is anticipated that this power will be used in limited circumstances and where it is appropriate for the Secretary to act immediately. The Secretary must have a reasonable belief that one of the circumstances noted has occurred before suspending the service's approval.

The circumstances in which the Secretary may immediately suspend the approval of a service are where:

•

the service has failed to comply with all the applicable requirements imposed by a law of the Commonwealth, or State or Territory law, relating to child care; for example, where a service has its licence to operate a child care service suspended by the relevant state regulatory authority, the Secretary may also immediately suspend the approval of the service for family assistance law purposes;

•

the Secretary reasonably believes that there is an imminent threat to the health or safety of a child or children because of the care provided by the service; or

•

in urgent circumstances, where it is no longer appropriate for the service to provide child care; an example is where a service is found to be situated on contaminated land, requiring immediate evacuation of the child care service.

A service, which has its approval suspended, may have the decision to suspend its approval under subsection 201A(1) reviewed by an authorised review officer under Division 1 or Part 4 of the Family Assistance Administration Act and by the Administrative Appeals Tribunal (see item 12 ).

A service's approval cannot be cancelled under this provision. The procedure for cancellation of the approval of a child care service is set out in section 203 of the Family Assistance Administration Act.

New subsection 201A(2) provides that the notice informing the service that its approval has been suspended must:

•

specify the day on which the suspension is to take effect; the day cannot be any earlier than the day on which the notice is given;

•

set out the grounds upon which the Secretary has suspended the approval of the service; and

•

inform the service of its rights under the Family Assistance Administration Act to seek a review of the decision to suspend the approval of the service.

New subsection 201A(3) provides that the Secretary may revoke a suspension under section 201A(1). Notice of the revocation of the suspension of the approval of the service must be in writing. The revocation takes effect from the day set out in the notice. The Secretary may revoke the suspension with effect from the day the suspension was imposed.

A service may have the decision in relation to revocation under subsection 201A(3) reviewed by an authorised review officer under Division 1 or Part 4 of the Family Assistance Administration Act and by the Administrative Appeals Tribunal (see item 12 ).

Item 31 amends subsection 219D(1) to provide that, where a service receives a notice that its approval has been suspended or cancelled it must cease reducing fees from the day set out in the notice of the sanction. This amendment clarifies the date from which the service must stop reducing fees.

Item 32 amends subsection 219D(2) by providing that, where a service receives a notice of revocation of immediate suspension, the service must reduce the fees of individuals who are conditionally eligible from the date the service receives notice.

Item 36 inserts new section 224A. New section 224A provides that a notice of a decision to a service made by an officer under Part 8 (for example, a decision to suspend the approval of a service) is to be taken to have been given to the service if it is left at, or sent by prepaid post to, the address of the place of residence or business or the email address of the service last known to the Secretary.

New subsection 224A(2) provides that a notice of a decision under Part 8 of the Family Assistance Administration Act affecting a service may be given to the service by properly addressing, prepaying and posting the document as a letter. If this procedure is followed, then the notice is taken to have been given to the person at the time at which the notice would be delivered in the ordinary course of post, unless the contrary is proved.

New subsection 224A(3) provides that notices of decision forwarded to the service in accordance with new subsection 224A(2) are taken to be given to the service at the time when the notice would be delivered to the service in the ordinary course of the post, unless the service can establish that the notice was not received.

Part 2 - Application provisions

Items 42 and 46 are application provisions.

Item 42 provides that the amendments in item 23 and item 31 will apply to notices of suspension that are given to child care services on or after the commencement of those items.

Item 46 provides that the amendments made in item 36 will apply to a notice that is given to a service after the commencement of the item.

(c) Changes to information gathering provisions

Background

Division 1 of Part 6 of the Family Assistance Administration Act contains provisions relating to information gathering. Under section 154 of the Family Assistance Administration Act, the Secretary may require a person to give information or produce documents if the Secretary considers the information or documents to be relevant to the matters listed in the section.

Failure to comply with any of the obligations set out in Division 1 of Part 6 is an offence punishable by 12 months' imprisonment (section 159, Family Assistance Administration Act). Failure to comply with the requirements and provide information or a document could also result in a variation to a claimant's determination/s in certain circumstances.

Amendments made by this Schedule will allow the Secretary to vary a claimant's determination of conditional eligibility if they, or their partner, fail to provide information or a document relating to the claimant's conditional eligibility or eligibility. Similarly, variation may also apply if information or a document is not supplied and is relevant to: an application by a person for approval of a child care service; whether an approved child care service should continue to be approved; an application by a person for approval as a registered carer; or whether a person should continue to be approved as a registered carer.

Amendments are also made so that the Secretary may request information from a former operator of a child care service in relation to the records they are required to keep under the Family Assistance Administration Act. Under the amendments, the Secretary may also require former operators to produce the documents the former operator is required to keep.

Explanation of the changes

Part 1 - Amendments

Item 3 amends paragraph 62(1)(b).

Section 62 allows the Secretary to vary a claimant's determination of conditional eligibility when the claimant, or their partner, refuses or fails to provide information or a document under a request made under Division 1 of Part 6 where the information or document relates to the claimant's conditional eligibility. The claimant's determination of conditional eligibility may be varied with the effect that the claimant is not conditionally eligible from the Monday after the day the variation was made. Under subsection 62(2), if the claimant subsequently gives the information or produces the document by the end of the income year following the one in which the variation took effect, the Secretary must undo the variation determination.

The amendment made by item 3 to paragraph 62(1)(b) will allow the Secretary to vary a claimant's determination of conditional eligibility if the claimant, or their partner, refuses or fails to comply with a request made under Division 1 of Part 6 where the information or document requested relates to the claimant's conditional eligibility, or eligibility (as per the criteria set out in section 43 of the Family Assistance Act), or in relation to a matter set out in subsection 154(5) of the Family Assistance Administration Act (information or a document relevant to an application by a person for approval of a child care service; whether an approved child care service should continue to be approved; an application by a person for approval as a registered carer; or whether a person should continue to be approved as a registered carer).

This amendment brings the powers of the Secretary in relation to varying a claimant's CCB eligibility closer to those available in relation to family tax benefit.

Item 13 amends subsection 153(2) to insert 'or records' and is consequential to the amendments made to section 154 by items 14 and 15 .

Item 14 inserts new paragraph 154(5)(e) at the end of subsection 154(5) to allow the Secretary to obtain information regarding the records that a person is required to keep under section 219G. The information could include information relating to where the records are stored or located.

Item 15 inserts new subsection 154(5A). This subsection will allow the Secretary to request a former operator of a child care service to produce records they are required to keep under section 219G.

Section 219G of the Family Assistance Administration Act requires the operator of a service that ceases to be an approved child care service to keep records that the service would otherwise have been obliged to keep under section 219F of the Family Assistance Administration Act, had it not ceased to be an approved child care service. The service is required to keep the records for 36 months from the end of the year in which the care was provided. Failure to comply with obligations under section 219G is an offence with a penalty of 60 penalty units.

Section 219K of the Family Assistance Act gives an authorised officer the power to enter the premises of a former operator of an approved child care service during business hours to inspect the records that an approved child care service is required to keep under section 219G.

There is currently no power in the legislation for the Secretary to request information from former operators regarding the location of the records they are required to keep, or to require former operators to provide records. The amendments made by items 14 and 15 address this issue to allow the Secretary to request such information or records.

Item 16 amends subparagraphs 158(2)(b)(i) and (ii) to include references to 'records'. These amendments are consequential to the amendments made to section 154 by items 14 and 15 .

Item 17 amends subparagraph 158(2)(b)(iii) to include a reference to records that are to be produced. This amendment is consequential to the amendments made to section 154 by items 14 and 15 .

Item 18 amends subsection 159(1) to include a reference to 'records'. This amendment is consequential to the amendments made to section 154 by items 14 and 15 .

Item 19 amends paragraph 160(b) to include a reference to 'records'. This amendment is consequential to the amendments made to section 154 by items 14 and 15 .

Part 2 - Application provisions

Item 40 is an application provision. It provides that the amendments made by items 14 and 15 of this Schedule apply in relation to a requirement to keep records that arose before or after the commencement of this Schedule.

(d) Notification to parents

Background

Section 200 of the Family Assistance Administration Act provides that the Secretary may sanction an approved child care service when the service has not or is not complying with a condition for continued approval. The Secretary may sanction the service by imposing or varying a condition for continued approval under subsection 199(2), or suspending or cancelling the approval of the service. The Secretary must give the service notice of his or her intention to sanction the service and invite the service to make submissions stating why the service should not be sanctioned.

Two new powers of suspension are introduced in this bill, that is, the power of immediate suspension in new section 201A (see item 24 ) and the power of suspension when a service is given 10 infringement notices in a year (see Schedule 2 - item 7 ).

There is presently no power in the Family Assistance Administration Act that permits the Secretary to write to individuals using a child care service, informing them that the service is not complying with its obligations under the family assistance law.

The amendments enable the Secretary to inform individuals using a child care service that the service has not complied with, or is not complying with, a condition for continued approval; or has had its approval suspended or cancelled. An individual is not entitled to CCB for care provided while a service is suspended.

Explanation of the changes

Part 1 - Amendments

Item 4 amends subsection 104(1) by inserting new paragraph (ba) to provide that the Secretary may not review on his or her own initiative a decision to give a notice under section 204A.

Item 5 amends subsection 108(2) by inserting new paragraph (ca) to provide that a decision of the Secretary to give a notice under section 204A may not be reviewed on application under section 109A.

Item 25 inserts new section 204A into the Family Assistance Administration Act.

The new provision enables the Secretary to write directly to individuals, whose children are being cared for in a child care service, if the Secretary is satisfied that the service has not complied, or is not complying, with a condition for continued approval, without needing to provide to the service notice of the intention to write to the individual. The Secretary may also write to individuals whose children are being cared for in a child care service if the Secretary has suspended or cancelled the approval of a child care service.

New subsection 204A(1) provides that, if the Secretary is satisfied that an approved child care service has not complied, or is not complying, with a condition for continued approval, the Secretary may give a notice to an individual whose entitlement to be paid CCB may be affected.

New subsection 204A(2) provides that the notice must contain a statement that the Secretary is satisfied that the service has not complied, or is not complying, with a condition of continued approval and the effect on an individual's entitlement if the Secretary were to suspend or cancel the approval of the service. The Secretary may also set out other information that the Secretary thinks relevant.

New subsection 204A(3) provides that, if the Secretary suspends or cancels the approval of a child care service, the Secretary may give a notice to an individual whose entitlement to be paid CCB may be affected.

New subsection 204A(4) provides that the notice must contain a statement that the Secretary has suspended or cancelled the service's approval, and of the effect on an individual's entitlement because of the suspension or cancellation.

New subsection 204A(5) provides that the notice must be in a manner or form approved by the Secretary.

Part 2 - Application provisions

Item 43 is an application provision. The amendment provides that subsection 204A(1) will apply to non-compliance by a service with conditions for continued approval that occurs before or after the commencement of item 25 .

Any decision of the Secretary to give a notice under new subsection 204A(1) will be made after the commencement of the provision. The Secretary must be satisfied, at the date the notice is given to the individual, that the service has not complied, or is not complying, with a condition for continued approval. Therefore, the non-compliance upon which the Secretary relies may have occurred prior to the commencement date of new subsection 204A(1). However, the retrospective element in this application provision causes no practical disadvantage to the service because any non-compliant behaviour has already occurred and cannot be disregarded without undermining the whole measure, which is to the primary advantage of families.

The amendment also provides that subsection 204A(3) will apply to suspensions or cancellations of the approval of services that occur before or after the commencement of item 25 .

Any decision of the Secretary to give a notice under new subsection 204A(3) will be made after the commencement of the provision. The Secretary must be satisfied, at the date the notice is given to the individual, that the service is suspended or cancelled. The rationale for the amendment in relation to new subsection 204(1), is the same for new subsection 204(3).

(e) Changes to review provisions

Background

Part 5 of the Family Assistance Administration Act contains the review provisions for the family assistance law.

Subdivision B of Division 1 of Part 5 applies to internal review initiated by the applicant. The standard period for an application for internal review to be submitted by an individual is 52 weeks after the applicant is notified of the original decision. The 52 week appeal period exists because many of the decisions made under the family assistance law are related to entitlement to family tax benefit and CCB, which are connected to the income year. The same 52 week period for application for internal review currently applies to decisions relating to the operation of child care services.

Division 4 of Part 5 contains provisions relating to review by the Administrative Appeals Tribunal. Currently, in relation to decisions made under Part 8 of the Family Assistance Administration Act (approval of child care services and registered carers) and decisions made under section 57 of the Family Assistance Act (determination that a service is a sole provider), the review provisions allow for simultaneous application to the Secretary for internal review and to the Administrative Appeals Tribunal for review.

Amendments made by this Schedule will standardise the time limit for internal review of decisions relating to services to 28 days. Internal review of decisions relating to services will be a prerequisite for review by the Administrative Appeals Tribunal.

Explanation of the changes

Part 1 - Amendments

Item 6 inserts new paragraph 109D(6)(c) at the end of subsection 109D(6).

Under section 109D an application for internal review of a decision (other than an excepted decision) must be made within 52 weeks after the applicant is notified of the original decision. Subsection 109D(6) defines an 'excepted decision'.

The amendment made by item 6 is consequential to the amendment made by item 7 and excludes decisions of the kind mentioned in subsection 144(1) (which are decisions relating to child care services and registered carers) from the 52 week period to apply for internal review of decisions.

Item 7 inserts new section 109DA. New section 109DA places a 28 day time limit for review of decisions in relation to chid care services and registered carers. Under this new section an application for review of a decision of a kind mentioned in subsection 144(1) must be made no later than 28 days after the applicant is notified of the decision.

Decisions made under Part 8 of the Family Assistance Administration Act and subsection 57(1) of the Family Assistance Act (which are the decisions mentioned in subsection 144(1) are difficult to remedy retrospectively and it is preferable to have a shorter review period.

Item 8 amends subsection 111(2) so that decisions made by the Secretary personally, or by another agency head in the exercise of a delegated power, of the kind listed in paragraphs 111(2)(a) - (g) are excluded from review by the Social Security Appeals Tribunal. This amendment corrects an oversight from when subsection 111(1A) was enacted.

Item 9 inserts new paragraph 111(2)(h) at the end of subsection 111(2). New paragraph 111(2)(h) excludes decisions made under subsection 57(1) of the Family Assistance Act (determinations that an approved child care service is a sole provider) from review by the Social Security Appeals Tribunal.

This amendment corrects an anomaly that was created by the Social Security and Family Assistance Legislation Amendment (Miscellaneous Measures) Act 2006 , which amended the power to make a determination that a service is a sole provider. The Secretary now has the power to make such a determination, whereas the power previously sat with the Minister. Persons affected by such decisions will continue to be able to apply to the Administrative Appeals Tribunal for review.

Item 10 inserts new subsections 144(1A), 144(1B) and 144(1C).

New subsection 144(1A) provides that, if a decision of the kind referred to in subsection 144(1) has been reviewed under section 109A and the decision has been affirmed, varied or set aside and substituted, then application may be made to the Administrative Appeals Tribunal for review of the decision. This new subsection means that internal review of a decision is a prerequisite for review by the Administrative Appeals Tribunal.

New subsection 144(1B) provides that the decision for the purposes of subsection 144(1A) is taken to be the decision as affirmed if the Secretary or authorised review officer affirms a decision; the decision as varied if the Secretary or authorised review officer varies a decision; and the new decision if the Secretary or authorised review officer sets aside and substitutes a new decision.

New subsection 144(1C) provides that, if a decision referred to in subsection 144(1) is made by the Secretary personally, or by another agency head himself or herself in the exercise of a delegated power, application may also be made to the Administrative Appeals tribunal for review of the decision. This subsection is inserted because decisions made by the Secretary personally, or by another agency head in the exercise of a delegated power cannot be reviewed internally.

Item 11 amends subsection 144(1). This amendment is consequential to the amendments made by item 10 and changes the subsection to refer to an application being made under subsection 144(1A) or 144(1C).

Part 2 - Application provisions

Item 39 is an application provision, which provides that the amendments made by items 6 to 11 of this Schedule apply in relation to decisions made after the commencement of this Schedule.

(f) Backdating approval of child care service

Background

Subsection 194(5) of the Family Assistance Administration Act provides the Secretary with discretion to backdate the approval of a child care service. There is currently no limit on the length of time for which a service's approval can be backdated. This Schedule provides an appropriate limit.

Explanation of the changes

Part 1 - Amendments

Item 22 repeals subsection 195(4) and substitutes new subsection 195(4). Under existing subsection 195(4), the day from which the Secretary may approve a service may be a day before the day the Secretary approves the service. New subsection 195(4) provides that the approval of a service must not be a day that is earlier than six months before the day on which the application for the approval was made.

The new subsection 195(4) limits the retrospective approval of services to six months. Limiting the backdating to six months is intended to operate as an incentive for applicants seeking to have a service approved to resolve issues relating to their eligibility for approval for the purposes of the family assistance law as quickly as possible.

These amendments also address the issues associated with backdating approvals for longer periods, such as past period debts.

Part 2 - Application provisions

Item 41 is an application provision. It provides that the amendments made by item 22 apply in relation to applications for approval that are made after the commencement of this Schedule.

(g) Fee setting practices

Background

Section 76 of the Family Assistance Act allows a child care service to certify the rate of CCB where is considers that a child is 'at risk of serious abuse or neglect' or where the individual who is eligible for CCB by fee reduction for care provided by an approved child care service is 'experiencing hardship' of the kind specified in the instrument made under paragraph 82(3)(a) of the Family Assistance Act.

Jobs, Education and Training (JET) Child Care fee assistance provides extra help with the cost of approved child care for eligible individuals receiving income support who are the principal carers of children up to 15 years of age and who need to use child care to participate voluntarily in study, work or job search activities or meet their mandatory participation requirements. Jobs, Education and Training (JET) Child Care fee assistance pays most of the difference between the total child care fee and the amount covered by CCB, up to an individual's limit of hours for Jobs, Education and Training (JET) Child Care fee assistance (which may be different to their CCB eligible hours limit). Individuals who receive Jobs, Education and Training (JET) Child Care fee assistance currently pay 10 cents per hour per child, plus the cost for any additional hours over their CCB eligible hours limit.

In these situations, a different CCB rate applies from the normal rate, which is based on the individual's income. The service providing care to the child certifies the applicable rate and the period for which the rate applies (up to a maximum of 13 weeks). In practice, the rate certified by the service is equal to the amount of the fees charged by the service, which results in the individual not incurring any out of pocket expenses. A service can apply any fee amount it decides. Section 81 allows the Secretary to determine the rate applicable when a child is 'at risk of serious abuse or neglect' after the service has certified the rate for a period of 13 weeks.

The intention behind the amendments made by this Schedule is to ensure that a service does not charge an individual more than another individual would be charged for the same child only because the individual is eligible for the special rate and the individual's child care fees are fully or substantially paid for via CCB entitlement.

Explanation of the changes

Part 1 - Amendments

Item 26 inserts new subsections 219A(1A) and 219A(1B).

Section 219A sets out the obligations of an approved child care service to act on various notices or to take certain action when they give a certificate in respect of care that the service provides to the child of an individual who has been determined to be conditionally eligible. Compliance with those obligations is a condition for continued approval of an approved child care service. Sanctions under section 200 may apply for failure to comply with any obligation. A penalty of 60 penalty units applies if services fail to comply with these obligations.

New subsection 219A(1A) imposes an obligation on services to set fees for individuals who are eligible for Jobs, Education and Training (JET) Child Care fee assistance that do not exceed the amount of fees the individual would charge individuals who are not eligible for Jobs, Education and Training (JET) Child Care fee assistance. A penalty of 60 penalty units will apply for failure to comply with this obligation.

New subsection 219A(1B) defines Jobs, Education and Training (JET) Child Care fee assistance as the payment of the same name that is paid by the Commonwealth.

Item 27 makes a minor technical amendment to paragraphs 219A(2)(a) and (b) so that these paragraphs refer to the correct items in the table.

Item 28 amends subsection 219A(2) (table items 2 and 3, at the end of column 2). Table item 2 is relevant when a service certifies a rate applicable to an individual for a session of care when the individual is conditionally eligible in respect of a child and the service is satisfied that the child is at risk of serious abuse or neglect or the individual is experiencing hardship.

Table item 3 is relevant to a notice that the Secretary has determined a rate applicable to an individual and a child because the Secretary is satisfied that the individual is experiencing hardship or the child is at risk of serious abuse or neglect.

Item 28 amends these table items to impose an additional obligation on a service so that, if an individual is eligible for fee reductions under table item 2 or 3 because the individual is experiencing hardship or the child for whom child care is being provided is at risk of serious abuse or neglect, the service has to ensure that the fees set by the service for a session of care provided to the child do not exceed the amount of the fees that the service would charge another individual who was not eligible for the special fee reductions under table item 2 or 3 for the same child.

Item 29 is consequential to the amendment made by item 26 and amends subsection 219A(3) to include a reference to new subsection 219A(1A). The result of this amendment is that failure to comply with the requirements of new subsection 219A(1A) also constitutes an offence with a penalty of 60 penalty units.

Item 30 inserts a new paragraph 219B(1)(d) at the end of subsection 219B(1).

Subsection 219B(1) provides that, where a service is eligible under section 47 of the Family Assistance Act for CCB by fee reduction for sessions of care provided to a child at risk, the service must calculate the appropriate amount of CCB and reduce the fees charged by that amount. A penalty of 60 penalty units applies for failure to comply with this provision.

New paragraph 219B(1)(d) imposes a requirement on a service to ensure that, when the service is eligible for CCB by fee reduction for a child at risk, the fees set by the service for a session of care provided to the child do not exceed the amount of the fees that the service would charge an individual for the same session for the same child if the service was not so eligible.

Part 2 - Application provisions

Item 44 is an application provision. It provides that the amendments made by items 26, 28 and 30 apply in relation to a session of care provided after the commencement of this Schedule.

(h) Location of records

Background

Presently, section 219G of the Family Assistance Administration Act provides that a person who operates an approved child care service immediately before the service ceases to be an approved child care service must keep the records the service is required to retain under subsection 219F(1) for a period of 36 months from the end of the year in which care was provided.

Section 219K provides that an authorised officer may enter the premises of a former operator at any time during business hours to inspect the records referred to in section 219G.

The approval of a child care service for family assistance law purposes cannot be transferred from one operator to another operator. Therefore, the records of a service cannot be transferred. In order that an authorised officer may enter the premises of a former operator, the Secretary must know the location of the premises where the records are kept.

The new provisions will impose a new obligation on the person who is a former operator of an approved child care service to inform the Secretary of the location of the premises where the records of the service are kept. The obligation to inform the Secretary of the location of the premises where the records are kept is a continuing obligation for the time records are required to be kept.

The new provisions also amend the rules about when an authorised officer may enter the premises of a former operator.

Explanation of the changes

Item 33 inserts into section 219G new subsections 219G(3), (4), (5) and (6).

New subsection 219G(3) requires a person who is the former operator of an approved child care service to notify the Secretary in writing within 14 days after the cessation day of the premises at which the records of the former service are kept. The cessation day is the day the service ceased to be approved. A penalty of 60 penalty units applies.

The effect of the new provision will require the former operator of a child care service to inform the Secretary, within 14 days of the service ceasing to be an approved child care service, of the location of the records that are required to be kept under the family assistance law.

New subsection 219(4) requires a person who is the former operator of an approved child care service to inform the Secretary within 14 days of a change in the location of the premises where the records are held. This obligation remains for as long as the person is required to keep the records under subsection 219G(1). A penalty of 60 penalty units applies.

The requirement to inform the Secretary is an ongoing requirement for as long as the former operator is required under the family assistance law to keep the records. Records must be kept for 36 months from the end of the year in which care was provided (subsection 219F(1)).

New subsection 219(5) defines the expression 'cessation day', which is used in subsections 219G(3) and (4). The cessation day is the day a service ceases to be an approved child care service.

New subsection 219G(6) provides that subsections (3) and (4) are offences of strict liability. Strict liability is an appropriate basis for the offences as applied to former operators because of the difficulty the prosecution would have in proving fault (especially knowledge or intention) in this case; the fact that the offences are of a similar nature to the offence in subsection 219G(1); and the fact that the offence does not involve dishonesty or serious imputation affecting a person's reputation.

Item 34 repeals paragraph 219K(1)(b) and substitutes a new paragraph 219K(1)(b). An authorised officer will be entitled to enter the premises that were last notified to the Secretary under section 219G (with the consent of the occupier) where the records of the former service are located at any reasonable time of the day that is not a Saturday, Sunday or a public holiday at the place where the records are located.

Part 2 - Application provisions

Item 45 provides that the amendments made by items 33 and 34 will apply to services that cease to be approved child care services after the commencement of those items. A service ceases to be an approved child care service for the purposes of family assistance law when a service's approval is suspended or cancelled.

(i) Power to establish committees

Background

Section 16 of the Child Care Act 1972 , which is a predecessor to the family assistance law, gives the Minister the power to establish 'such other committees as the Minister thinks fit for the purposes of this Act'. Amendments made by this Schedule will create a similar power in the Family Assistance Administration Act.

Explanation of the changes

Item 35 inserts new section 221A, which empowers the Minister to establish committees for the purposes of the family assistance law.

New subsection 221A(1) provides the Minister with the power to establish committees, in writing, for the purposes of the family assistance law.

New subsection 221A(2) provides that a committee has the functions determined in writing by the Minister.

New subsection 221A(3) provides that a committee must comply with any directions given to the committee by the Minister.

New subsection 221A(4) provides that the appointment of members of a committee are to be made by the Minister in writing.

New subsection 221A(5) provides that a member of a committee holds office on a part-time basis.

New subsection 221A(6) provides that the Minister may appoint a member of a committee to be the Chair of that committee.

New subsection 221A(7) provides that a member of a committee is to be paid the remuneration that is determined by the Remuneration Tribunal. If no determination by the Remuneration Tribunal is in operation, then the member is to be paid the remuneration that is prescribed by the regulations. The remuneration that the Remuneration Tribunal determines may include allowances such as travel allowance.

New subsection 221A(8) sets out that a member of a committee is entitled to be paid the allowances that are set out in the regulations.

New subsection 221A(9) makes it clear that subsections 221A(7) and (8) have effect subject to the Remuneration Tribunal Act 1973 .

New subsection 221A(10) requires a member to declare, in writing to the Minster, any direct or indirect pecuniary interests that the member has or acquires and that conflicts or could conflict with the proper performance of the member's functions.

New subsection 221A(11) provides that a member who wishes to resign must notify the Minister in writing.

New subsection 221A(12) provides that the Minister will have the discretion to terminate the appointment of a member at any time.

(j) Debt recovery from services run by unincorporated bodies or associations

Background

An approved child care service is under an obligation to pay a debt to the Commonwealth that arises under Part 4 of the Family Assistance Administration Act. If the approved service is an unincorporated body or association, such as a partnership, then paragraph 231(2)(a) of the Family Assistance Administration Act provides that the relevant debt is imposed on 'each partner'. If it is an unincorporated body or association (the body) other than a partnership, then each member of the committee of management of the body is liable.

Amendments made by this Schedule change the methods of recovery of debts owed by child care services that are operated by unincorporated bodies or associations.

Explanation of the changes

Part 1 - Amendments

Item 37 is consequential to item 38 . This item includes a reference to new subsection 231(2A) in subsection 231(2).

Item 38 inserts new subsection 231(2A), which provides that, if a debt becomes due by a service that is operated by an unincorporated body or association, then subsection 231(2) does not apply and the debt is taken to be a debt owed by the service. Subsection 231(2) identifies individuals within the unincorporated body on whom obligations can be imposed and who can discharge those obligations.

The policy intent behind the changes made by these amendments (and reflected in the note to new subsection 231(2A)) is to clarify that debts of child care services operated by partners or unincorporated bodies are recoverable through the same methods of recovery that are applicable to other child care services that are not operated by unincorporated bodies or associations under subsection 82(2). This includes the option of recovering the debt by repayment of instalments under an arrangement entered into under subsection 91(1A).

Part 2 - Application provisions

Item 47 is an application provision, which provides that the amendments made by items 37 and 38 apply in relation to debts that become due to the Commonwealth after the commencement of those items.