Tuesday, 26 June 2018
Questions without Notice
Child Care: Fraud
My question is to the Minister for Education and Training, Senator Birmingham. Minister, on 12 June, while attending a meeting of the red tape committee in Brisbane, I was present when the committee received submissions about child care in Australia. At this meeting I asked the representative of the Department of Education and Training about two women who are at the centre of an alleged $5.7 million family day care fraud, but I failed to obtain an informative response. Since the department appears unable to provide any clear information on this issue, can the minister detail what the process was that allowed a departmental official to sign off on 11 cheques totalling $5.7 million for some 1,600 children who were enrolled on the same day by the same person?
I thank Senator Anning for his question. Senator Anning has asked about a particular and specific instance, and I will more than happily take the particulars, in terms of that instance, on notice and, if I can, provide further information to Senator Anning about that individual case.
What I can inform Senator Anning, through you, Mr President, is that the Turnbull government has taken a number of steps over a period of time to ensure there is a zero-tolerance approach to fraud, particularly in the family day care sector. Our actions have seen significant savings accrued. Over the course of the first six months of this year, we delivered an integrity surge that generated savings of around $1 billion in claims that would otherwise have been wrongly made. We did that through cooperation with different departments, between the Commonwealth and state and territory governments, data-matching to identify those who may be doing the wrong thing and making erroneous or illegal claims.
We have suspended many services, and we have upped compliance activity. When we took office, just a few hundred checks on family day care services were conducted per annum. Today more than 4,000 checks on services are conducted per annum to ensure we have a much tougher audit regime that's catching more people out and leading to the suspension of services. It has seen dozens of matters referred for legal action and resulted in a number of individuals either facing criminal charges or having been convicted and serving time as a result of their defrauding of the Australian taxpayer. We will not tolerate it. We have taken whatever action we can. Our new childcare system, which is coming into effect on 2 July, has stronger safeguards and a better data system to help ensure we prevent this even more effectively in the future.
It stuns me that the minister is not aware of this particular case. But, given what appears to be a disastrous failure of fiduciary responsibility by the department, can the minister assure the Australian taxpayer that there aren't any more instances of funding misuse, and, if there are, to what extent?
What I can assure Senator Anning, all senators and the Australian public is that we take compliance very seriously. On our estimates, the range of compliance measures we've taken, in terms of tightened regulation, increased compliance checks and audits and, ultimately, suspensions or cancellation of services, have saved around $2.4 billion over the last few years and into the future, in terms of what could have been wrongfully claimed subsidies. We'll continue to take that zero-tolerance approach.
As I was indicating at the conclusion of my last answer, the new childcare subsidy, which is coming into effect on 2 July, has tighter regulatory arrangements around it that will better enable officials to control the flow of money to service providers. It has a better IT and data-integrity system around it that will better enable officials to identify where rorting may happen and shut it down instantly, and to make sure that this type of rigorous action, including throwing the book at and charging individuals, occurs where it can. (Time expired)
Again, I took the particulars in relation to this case on notice, and we will provide that information back to Senator Anning. All I can say is that we've put more resources behind compliance, auditing and integrity checks than has ever been the case before. As I indicated in the primary answer, when we took office there were just a few hundred audits undertaken each year and there had been zero suspensions or cancellations. We're now undertaking more than 4,000 audits each year and we've engaged in more than 100 suspensions or cancellations just through the six-month integrity surge and many more in addition to that.
Officials are taking very serious steps not just to drive out of the system people who are doing the wrong thing, but, where they can, they are working with the Australian Federal Police, which has seen charges laid, successful convictions and individuals thrown into jail, as a result of their ripping off of the Australian taxpayer—something which we will not tolerate and we will continue to tighten the net on.