House of Representatives

Explanatory Memorandum

(Circulated by the authority of the Minister for Education and Training, Senator the Hon Simon Birmingham)

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

FAMILY ASSISTANCE LEGISLATION AMENDMENT (JOBS FOR FAMILIES CHILD CARE PACKAGE) BILL 2016

This Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the Bill

The Family Assistance Legislation Amendment (Jobs for Families Child Care Package) Bill 2016 (the Bill) will introduce key aspects of the Jobs for Families Child Care Package that was announced in the 2015 - 16 Budget. The objective of the Jobs for Families Child Care Package is to improve access to quality education and child care, support parents as they balance work and family responsibilities, and enable greater engagement with the workforce. To support the implementation of the Jobs for Families Child Care Package, the Australian Government has committed more than $3 billion in additional funding for child care.

Measures in the Bill seek to complement and enhance existing Commonwealth funded child care programmes, and the State and Territory quality regime established through the Education and Care Services National Law Act 2010 (Vic) (the "National Law") (as applied in other State and Territory jurisdictions and which relates to the monitoring of the quality of child care services). The Bill therefore reflects an increasing recognition of the importance of cooperation between the various levels of government.

The Bill proposes to introduce the Child Care Subsidy (CCS), a single, means - tested subsidy that will replace current child care payments and be better targeted to provide more assistance to low and middle income families. The CCS will be supplemented by the Additional Child Care Subsidy (ACCS), in recognition that extra support is needed for some disadvantaged and vulnerable children and the significant benefits that quality child care and early learning can have on children's early development. The ACCS will provide support for families with children at risk of serious abuse or neglect (through "ACCS (child wellbeing)"), families experiencing temporary financial hardship (through "ACCS (temporary financial hardship)"); families on income support transitioning to work (through "ACCS (transition to work)"); and grandparent carers on income support (through "ACCS (grandparent)").

The Bill sets out the following matters relating to the new child care payments regime:

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the cessation of Child Care Benefit (CCB) and Child Care Rebate (CCR);

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the introduction, from 2 July 2018, of a new Child Care Subsidy (CCS), which is subject to both an income and activity test;

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the introduction of various rates of Additional Child Care Subsidy (ACCS) that are available to individuals and child care providers in various circumstances;

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other amendments to deal with CCS and ACCS claims, reviews of decisions, provider approvals and compliance obligations of approved providers of child care services.

In doing so, the Bill engages with the following treaties and Articles contained within:

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International Covenant on Economic, Social and Cultural Rights (ICESCR) - Articles 6 and 9;

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Convention of the Rights of the Child (CRC) - Articles 2, 3, 6, 14, 18, 19, 27 and 36;

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International Covenant on Civil and Political Rights (ICCPR) - Articles 26, 14 and 17; and

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Convention on the Elimination of all Forms of Discrimination Against Women (CEDAW) - Articles 10 and 11.

Human rights implications

The right to work

Article 6 of the International Covenant on Economic, Social and Cultural Rights (ICESCR) requires that State Parties recognise the right to work, including through developing policies and techniques to achieve steady economic, social and cultural development and full and productive employment. This right goes to the core objective of the Bill, to help parents who want to work, or who want to work more. It is estimated that the Package will encourage more than 230,000 families to increase their involvement in paid employment.

The rights of parents and children

Article 3 of the Convention of the Rights of the Child (CRC) recognises that in all actions concerning children, the best interests of the child shall be a primary consideration. The Bill establishes a new CCS that provides a higher rate of assistance to low and middle income families compared to the current child care assistance, and the supplementary ACCS that will increase the access of children to quality child care. Early childhood education and care plays a vital role in the development of Australian children and their preparation for school. Access to early childhood education and care is also one of the most effective early intervention strategies to break the cycle of poverty and intergenerational welfare dependence. Additionally, ACCS payments will ensure vulnerable children have access to the benefits of child care.

Article 18 of the CRC mandates that State Parties shall use their best efforts to ensure recognition of the principle that both parents have common responsibilities for the upbringing and development of the child, and to provide appropriate assistance, in particular to ensure that children of working parents have the right to benefit from child care services and facilities for which they are eligible. This Bill will support the introduction of a simpler, more affordable, more flexible and more accessible child care system.

Article 19 of the CRC requires that appropriate measures are taken to protect the child from all forms of physical or mental violence, injury or abuse, neglect or negligent treatment, maltreatment or exploitation. The ACCS (child wellbeing) payment, in particular, is designed to address the barriers faced by children and individuals in certain vulnerable situations, in being able to access quality child care. Article 19 also requires that measures be taken to identify, report, refer, investigate, treat and follow - up any instances of abuse. Under the reforms proposed by the Bill, if an individual or child care provider is eligible for the ACCS (child wellbeing) payment (where the child has been identified as at risk of serious abuse or neglect), the provider must make relevant State or Territory authorities aware of the child's circumstances. This information sharing is also considered a justifiable limitation on the right to privacy, as it furthers the rights of children under the CRC.

The Bill also furthers Article 3(3) of the CRC, relating to the requirement of State Parties to ensure child care providers conform to standards relating to the number and suitability of staff and competent supervision, by implementing mechanisms that allow for the collection and sharing of information with the States and Territories who are responsible for monitoring the quality of care and safety of children in care. Further, the collection of enrolment information and information about attending a session of care from approved child care providers will provide the Commonwealth with meaningful data for the purposes of research and policy development to ensure the child care payments scheme is properly targeted and meeting its objectives. In doing so, the Bill engages with Article 18(2) of the CRC by facilitating improved, evidence based assistance to parents in raising children, and supporting the development of institutions, facilities and services for the care of children. Such measures would be directed to monitoring and improving all child care in Australia, and not just child care subsidised by the Commonwealth. To the extent that these measures may limit the right to privacy, they are reasonable and proportionate to assist the Australian Government to meet its requirements under the CRC and other treaties that deal with the rights of parents and children.

The right to an adequate standard of living

Article 27 of the CRC requires that State Parties recognise the right of every child to a standard of living adequate for the child's physical, mental, spiritual, moral and social development. The Bill advances this right through the CCS and the ACCS which will address barriers to accessing child care to ensure all children, regardless of parental income, have access to an adequate amount of child care to aid socialisation and development.

The right to social security

Article 9 of the ICESCR recognises the right of everyone to social security. Under the Bill all families who meet basic eligibility criteria will be eligible for some fee assistance through the CCS, so long as they also meet an activity test. Additionally, children at risk of serious abuse or neglect, families experiencing temporary financial hardship and families transitioning from income support to work will be eligible for further support through ACCS payments that will ensure all children have access to adequate child care, regardless of circumstances.

Recent amendments to section 24 of the Family Assistance Act restricted the maximum period of eligibility for family assistance payments (including CCB) from 56 weeks to six weeks (the "portability period") for individuals who travel overseas. This position is maintained for CCS purposes through a new provision in the Bill which relates specifically to CCS (see section 85EE as proposed for the Family Assistance Act). As is currently the case for CCB, the Secretary is given the discretion to extend the six week period under section 85EE of the Family Assistance Act for individuals who are members of the Australian Defence Force or Australian Federal Police and who are deployed overseas, assisted by the Medical Treatment Overseas Program, or unable to return to Australia for a specified reason (such as a serious accident, or natural disaster). To the extent that a limited portability period provides a limitation on the right to social security, it is reasonable and proportionate given that individuals will still be able to access child care payments for a reasonable period of time while overseas (for up to six weeks, or longer in specified circumstances). The six week time period will generally align with the maximum six week portability period allowed for most other family payments and working age income support payments for a person who is overseas. Furthermore, the discretion to extend the six week period for up to three years provides a safeguard to avoid harsh consequences for individuals who may not be in a position to return within the six week period due to their particular circumstances.

The right to be free from discrimination

Through the measures in the Bill which seek to make child care simpler, more affordable and more flexible, the Bill also seeks to alleviate some of the current pressures experienced by families, some of which have a negative disproportionate impact on women in particular. Articles 10 and 11 of the Convention on the Elimination of all Forms of Discrimination Against Women (CEDAW) mandates State Parties to take all appropriate measures to eliminate discrimination against women in the field of education and employment, by providing, amongst other things, the same conditions for career advancement and vocational guidance. There are several ways in which the Bill engages with this important right. Through the broadly expressed activity test requirements associated with CCS eligibility, women who are engaged in paid work, an approved course of training or study, or volunteering will receive a number of subsidised hours of child care. There is also the ability to prescribe additional activities as recognised activities or associated activities. Individual circumstances may also be considered on a case by case basis to accommodate the greatest flexibility possible for eligible individuals, including women. This is intended to allow for some activities, which may not be conventionally regarded as an activity (e.g. being on leave from work, or in a semester break), to be counted as recognised activity for the purpose of receiving CCS. In addition, there are several types of supplementary ACCS which are designed to assist individuals, and could support women in particular, to receive subsidies to support their workforce participation, such as the ability to receive payments when transitioning to work.

Article 26 of the International Covenant on Civil and Political Rights (ICCPR) and Article 2 of the CRC requires that persons are equal before the law and that the law shall provide equal and effective protection against discrimination on any grounds. The Bill sets out a range of eligibility criteria for the CCS and the ACCS in relation to age of the child, residency requirements, immunisation status of children and for grandparents.

Using a child's age as a criterion to determine eligibility is considered legitimate differential treatment as those children 13 and under are particularly vulnerable and require close care and supervision on a constant basis, compared with older children. The child care payments system is obviously also administered within a broader policy context that includes other forms of financial assistance to school children. In addition, in exceptional circumstances and where access to child care is in the best interests of a child, the Bill includes provision for the Minister to make rules to enable children aged over 13 to access CCS and ACCS.

Using residency requirements as a criterion to determine eligibility is a proportionate limitation on the right to be free from discrimination, because it is important for the Secretary to reconcile payments against residents' tax assessment information, noting also that residency requirements are not applied to children at risk of serious abuse or neglect, in relation to whom a provider can be eligible for ACCS regardless of the child's residency status.

Using immunisation status as a criterion to determine eligibility is legitimate differential treatment as Article 14 of the CRC allows for limitations on one's freedom to beliefs when it is necessary to protect public health and safety in a facility responsible for the care or protection of children. The immunisation eligibility criterion is a necessary limitation to encourage parents to better protect children from diseases. The exemption on medical grounds constitutes a safeguard to protect the individual safety of the child.

The ACCS (grandparents) payment is considered legitimate differential treatment as it is a special measure intended to further support a group who are already vulnerable and in receipt of income support. This payment is also an early intervention strategy to break the cycle of poverty and intergenerational welfare dependence by providing disadvantaged families with adequate access to child care.

The right to be presumed innocent

Article 14 of the ICCPR requires that in the determination of any criminal charge, everyone shall be entitled to a set of minimum guarantees and that anyone convicted will have the right to review and compensation if the conviction is not upheld. Under the Bill there are both civil penalties and criminal penalties. These penalties are part of a multi - pronged approach to further deter fraud and ensure the integrity of payments, and also protect children from harm, in line with obligations under Article 19 of the CRC.

Article 14 of the ICCPR also requires that anyone charged with a criminal offence shall have the right to be presumed innocent until proved guilty according to the law. Under the Bill there are strict liability offences that apply to factual scenarios. These offences are proportionate to the value of maintaining adequate safeguards in relation to the large sums of public money involved in administering the child care payments system. It is considered reasonable in these cases to impose strict liability offences to ensure the integrity of payments. It is intended that prosecution action will only be taken in relation to strict liability offences in serious or repeated cases.

The right to privacy

Article 17 of the ICCPR and Article 16 of the CRC requires that no one shall be subject to arbitrary or unlawful interference with privacy. Under the Bill, as part of administering the CCS and the ACCS and for the enhancement of the child care system overall, information will be collected and stored on a new IT system that will be built to meet legislative requirements. This information collection and storage will be subject to the Privacy Act 1988 as well as the existing and stringent secrecy provisions in the family assistance law.

Under the Bill, if a child care provider is suspected of breaching obligations that are subject to monitoring powers, the Secretary may deem it necessary to visit the facility without advising the operator beforehand of its intention to do so. However, the provider retains their right to refuse to allow entry (such a refusal can only be overcome through the issue of a warrant). This limitation of the providers' and clients' right to privacy is in response to the Australian National Audit Office finding that the Government is losing an estimated $700 million a year on misleading or fraudulent child care practices. Given the scale of the breaches this interference is not considered arbitrary, but a reasonable and proportionate response to protect Government expenditure and uphold the integrity of payments.

The right to privacy, the right to be presumed innocent and the triggering of Parts of the Regulatory Powers (Standard Provisions) Act 2014

The Bill proposes amendments to the Family Assistance Administration Act that would trigger Parts 2, 4 and 5 of the Regulatory Powers (Standard Provisions) Act 2014 (Regulatory Powers Act), which deal with monitoring, civil penalties and infringement notices (see new Part 8C). Those Parts are triggered in relation to a number of obligations of approved child care providers associated with their approval (and have no bearing on the enforcement of obligations of parents and other individual CCS payment recipients). Prior to amendments proposed by the Bill, child care provisions in the family assistance law contained a codified set of monitoring provisions as well as its own civil penalty and infringement notice regime (as set out in current Part 8C of the Administration Act).

The main purpose of these amendments in the Bill is to follow whole of Government policy and trigger the standard suite of provisions of the Regulatory Powers Act in relation to monitoring powers, as well as processes for enforcement of civil penalties and infringement notices.

The repealed provisions of the Family Assistance Administration Act which deal with these matters adopted approaches that were unique to the family assistance law and created unnecessary regulatory complexity as they differed from the standard approach adopted in the Regulatory Powers Act in key ways including by: establishing only a personal right of the Minister to apply for a civil penalty order; establishing infringement notice formalities, which included only a limited power for their withdrawal; and ambiguity about methods of their enforcement.

These amendments are important to adopt a more streamlined and consistent approach with other Commonwealth legislative schemes and to simplify the family assistance law itself, which, as a result of the proposed amendments, will contain a simpler Part 8C.

In triggering the Regulatory Powers Act, the intention is to also establish consistency from a human rights perspective with a whole of Government approach to civil enforcement mechanisms.

Monitoring provisions

Part 2 of the Regulatory Powers Act creates a framework for monitoring whether provisions have been complied with. It includes powers of entry and powers to seek production of documents and information. Certain provisions in the Bill are subject to the monitoring provisions set out in Part 2 of the Regulatory Powers Act. These include all civil penalty provisions, certain conditions for continued approval of an approved provider, and provisions requiring compliance by the giving of specific types of information (to the extent the requirement is placed on an approved provider, rather than a parent or other CCS payment recipient or eligible individual). In addition, related provisions which are subject to the monitoring provisions include certain offence provisions (as listed in proposed section 219UA of the Administration Act).

As a result of triggering the monitoring framework in the Regulatory Powers Act, only "authorised officers" (who are authorised under the framework established in Part 2 of the Regulatory Powers Act) will be able to enter premises, by consent or, with a judicially issued warrant. Authorised persons will be able to exercise related powers, such as powers to ask questions and secure evidence. The amendments in the Bill make a small modification to the operation of the Regulatory Powers Act by ensuring that consent for entry can be provided by either the occupier of premises or a person apparently representing the occupier. This modification is intended to address the business reality that many child care services are operated by staff and employees of a provider or operator who may invite authorised persons onto premises, without necessarily being an "occupier" for the purposes of Part 2 of the Regulatory Powers Act.

Triggering the monitoring provisions in the Regulatory Powers Act engages the protection against arbitrary or unlawful interference with privacy. Article 17 of the ICCPR prohibits arbitrary or unlawful interference with an individual's privacy, family, home or correspondence, and protects a person's honour and reputation from unlawful attacks. The right to privacy can be limited to achieve a legitimate objective where the limitations are lawful and not arbitrary. In order for an interference with the right to privacy to be permissible, the interference must be authorised by law, be for a reason consistent with the ICCPR and be reasonable in the circumstances. The United Nations Human Rights Committee has interpreted the requirement of "reasonableness" as implying that any interference with privacy must be proportionate to a legitimate end and be necessary in the circumstances.

To the extent that the triggering of the monitoring provisions may limit the right to privacy, this limitation is provided by law. The power to secure things in the exercise of monitoring powers is necessary to enable collection of evidence of contraventions of provider obligations under the family assistance law. The exercise of the power is constrained and not arbitrary because the powers are focussed on ensuring compliance with obligations that approved providers have accepted as part of their approval as a child care service.

Monitoring important provider obligations also ensures the safety of children cared for by child care services and their best interests, consistently with Article 3 of the CRC.

The monitoring powers are also intended to be subject to the implied privilege against self - incrimination at common law.

Civil penalties and infringement notices

Proposed Divisions 2 and 3 of Part 8C of the Family Assistance Administration Act state that all "civil penalty provisions" are subject to Parts 4 and 5 of the Regulatory Powers Act.

As noted, triggering Parts 4 and Part 5 of the Regulatory Powers Act ensures that civil penalty orders and processes for issuing infringements are dealt with under a consistent whole of Government framework.

Civil penalties and infringement notices mean that the Secretary has the capacity to enforce provider obligations by pursuing financial penalties rather than through prosecuting criminal offences. Most of the civil penalty provisions proposed by the Bill contain "parallel" offence provisions, which means that there is a civil enforcement option open and that criminal enforcement can be reserved for serious cases.

Triggering of the civil penalty and infringement provisions in the Regulatory Powers Act is compatible with the right to liberty and security of the person and freedom from subjection to arbitrary arrest or detention, as set out in article 9 of the ICCPR.

Establishing a strong civil enforcement regime also ensures that considerations relating to the safety of children cared for by child care services and their best interests, underpin actions taken by agencies, consistently with Article 3 of the CRC.

Conclusion

The Bill is compatible with human rights. The current system is complex and difficult for families to navigate. It is inflexible and does not effectively meet families' workforce participation needs. Measures in the Bill are compatible with and advance human rights under the ICCPR, the CEDAW, the CRC and the ICESCR which will ultimately enable parents who wish to work, or to work more, by providing a simpler, more affordable, more flexible and more accessible child care system. As described above, to the extent that the proposed Bill may limit some rights, those limitations are reasonable, necessary and proportionate.

Senator the Hon Simon Birmingham, Minister for Education and Training