Faaea v Secretary, Department of Education

NCAT Administrative and Equal Opportunity|2018-03-08|Before: Dr J

Solicitors: Applicant in person NSW Crown Solicitor (Respondent) File Number(s): 2017/340656

REASONS FOR DECISION

This was an application for review of a decision to cancel the applicant's service approval under the Children (Education and Care Services) National Law (NSW) ("National Law"). A person is required to have a service approval to operate an education and care service.
The respondent ("the Secretary") cancelled the applicant's service approval on the basis that she had not complied with a condition of the approval, being the requirement for the service to commence ongoing operation within six months of the grant of approval.
The applicant asked the Tribunal to set aside the cancellation decision, saying that she had been awaiting child care benefit approval from the Commonwealth before starting to provide education and care to children. She also said that she had commenced operation of the service by obtaining business premises, advertising for educators and preparing documentary material.
I found that the condition requiring the applicant to commence operations within six months meant that she was required to provide education and care to children within that time frame. I also found that awaiting child care benefit was not a good reason for not commencing operations. Accordingly, I decided to affirm the Secretary's decision.

Background

On 13 January 2016, the applicant, as approved provider, was granted a service approval for her education and care service under s 48 of the National Law. She proposed to operate a family day care service, trading under the name "King of God's Kingdom."
A service approval is granted subject to a condition that the service must commence ongoing operation of the service within 6 months after the approval is granted, unless the Secretary agrees to an extension of time (National Law, s 51(3)).
The applicant did not commence operation of the service, as she was waiting upon child care benefit approval from the Commonwealth government.
On 26 July 2016, an authorised officer of the Secretary emailed the applicant asking her for a copy of the current register of family day care educators for her service, explaining that the purpose was to establish if she had commenced ongoing operation of her service.
The applicant replied by email on the same day, stating "We didn't operate any services due to our request for funding." She did not provide the requested document.
On 4 August 2016, authorised officers of the Secretary attended at the principal office of the applicant's business. It was unattended and without signage. At the time, the applicant was overseas for family reasons.
On 12 September 2017, the Commonwealth Department of Education and Training refused the applicant's application for child care benefit approval.
After issuing a show cause notice and considering the applicant's response, on 27 October 2017, the Secretary gave notice to the applicant of the decision to cancel her service approval with effect from 10 November 2017, pursuant to s 79(1)(a) of the National Law. The ground for cancellation relied upon by the Secretary was that a condition of the service approval had not been complied with (National Law, s 77(d)).
The applicant then applied to the Tribunal for an administrative review of the Secretary's cancellation decision within the required time frame of 30 days (National Law, ss 192(b)(iv) and 193(1) and (2)).

Consideration

The Tribunal's task, when reviewing decisions under the National Law, is to determine what the correct and preferable decision is, having regard to the material before it (DBU v Secretary, Department of Education [2017] NSWCATAD 257 at [26]).

Had the applicant commenced operations?

The applicant submitted at the hearing that her service had commenced operations. There is some tension between this submission and her statement, in her application to the Tribunal, that "I have failed to comply with Section 173 of the National Law by not notifying the Department that I had not commenced operation of the service within six months of the grant of approval."
In support of the submission, the applicant said that she had submitted a quality improvement plan within cl 55 of the Education and Care Services National Regulations, before the due date. Clause 55 requires a quality improvement plan to be prepared within 3 months of the grant of the service approval and to be submitted to the Secretary on request. The applicant also provided evidence that she had advertised, on social media, for educators.
The applicant said at the hearing that she had some educators on standby and that she could provide evidence of enrolling children. She had not provided this evidence in accordance with the Tribunal's directions, which required her to provide evidence including statements, on a date about a month prior to the hearing.
I gave the applicant leave to hand up two enrolment forms, dated 29 February 2016, which related to two siblings. The applicant's oral evidence was that the children had never attended her service, as their parents were waiting on the applicant's child care benefit approval. The person (presumably a parent) who filled out the enrolment forms did not, however, tick the box indicating that he or she wished to claim child care benefit. Instead, the box indicating that the parent wished to receive child care rebate was ticked.
The applicant also sought to call a witness, Georgina Luapo, who gave evidence that the applicant was operating a business but had now stopped. Ms Luapo said that she intended to work in the business when she had finished her Diploma of Early Childcare and that she was on a "waiting list" to be an educator for the service. Mr Luapo also gave evidence that she was present when the applicant held an opening of the family day care service, in early 2016, which consisted of a celebration with friends and family and a presentation. Whilst Ms Luapo asserted that children had attended the family day care service at one point, this was contrary to the applicant's position. When asked about this by the Tribunal, Ms Luapo agreed that she had no direct knowledge of the family day care service providing care for any children.
I am not satisfied, from the applicant's evidence, that she commenced ongoing operation of the service within six months, or at all. Whilst the applicant engaged in preparatory activities, such as setting up business premises and identifying potential educators and clients, her service did not provide care to any children. In 3 Angels Family Day Care Pty Ltd v Secretary, Department of Education [2017] NSWCATAD 265 at [15]-[16], I found that similar business-related activities did not constitute commencing ongoing operation of a service, in the absence of providing care to children. Senior Member Ransome has observed that, for a family day care service to have commenced ongoing operations, the service "must actually be operating as a family day care service providing education and care to children through the use of two or more educators" (DBU v Secretary, Department of Education [2017] NSWCATAD 257 at [37]). This is consistent with the comments of Senior Member Grant in CVM v New South Wales Department of Education, Early Childhood Education & Care Directorate [2017] NSWCATAD 108 at [45]. I respectfully agree with the comments of both senior members. Activities such as obtaining enrolment forms, preparing a quality improvement plan, renting business premises and creating a "waiting list" of educators, do not constitute commencing ongoing operation of a service.
I find that the applicant did not comply with the condition that the service commence ongoing operation of the service within 6 months after the service approval is granted. I also find that she did not commence ongoing operation of the service at all.

Whether the decision to cancel the service approval is the correct and preferable decision

Even where the holder of a service approval has not commenced ongoing operations of a service within six months, there may be circumstances in which it is not the correct and preferable decision to cancel the approval. It is therefore important to consider the reasons why the applicant did not commence ongoing operation.
The main reason the applicant gave for failing to commence operation of the service was that she had not yet obtained child care benefit approval. The lack of child care benefit approval does not preclude a service from commencing operations, although it may make it harder, in practice, to obtain clients. As Senior Member Grant said in CVM v New South Wales Department of Education, Early Childhood Education & Care Directorate [2017] NSWCATAD 108 at [59], "CCB approval is about the financial management of the service and is not a criteria or barrier to commencing operation under the National Law."
The imposition of a time frame for commencing operations in s 51(3) is not a matter which the holder of a service approval should ignore. Section 51(3) contemplates that the Secretary may extend time for commencing operations. The holder of a service approval may apply to the Secretary for an extension, should the holder need it. The applicant did not apply for any extension and continued to wait for child care benefit approval before commencing operations, including for over a year after her email exchange with an authorised officer of the Secretary about the failure to commence operations in July 2016.
As the respondent submitted, the National Law is a law calling for strict compliance (CTG v NSW Department of Education, Early Childhood and Care Directorate [2017] NSWCATAD 60 at [45], citing Long Life Family Daycare v Director General Education Directorate [2016] ACAT 69). In order to ensure "the safety, health and wellbeing of the children being educated and cared for by the service" (National Law, s 51(1)(a)), it is necessary to comply with a large number of regulatory requirements. It is not for the holder of a service approval to choose which requirements to comply with according to the holder's own view of what is important. A holder of a service approval who considers that compliance with s 51(3) may be difficult, should ask for an extension of time.
The applicant failed to commence operations of her service for a period of about 21 months. This is more than three times the period in which she was required to commence operations. The length of time the applicant held a service approval without providing education and care for children is also a relevant factor in determining what the correct and preferable decision is.
The applicant's application for child care benefit has now been refused, raising a real doubt about her capacity to run her business, given that she considered it was dependent upon the approval of child care benefit. She said at the hearing that she was now seeking to obtain funding from the National Disability Insurance Scheme. She did not file any evidence of making that application and, on her own oral evidence, does not know whether she will obtain such funding. I am not persuaded, from her evidence, that she will be able to operate the service without external funding.
In these circumstances, the correct and preferable decision is that made by the Secretary, being to cancel her service approval.

ORDERS

Pursuant to s 193(3)(a) of the Children (Education and Care Services) National Law (NSW), the respondent's decision to cancel the applicant's service approval is confirmed.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar

Amendments 18 April 2018 - Applicant's surname corrected in MNC DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 18 April 2018

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