Sweet Melon Family Day Care Pty Ltd and Secretary, Department of Education and Training

This matter concerned an application by Sweet Melon Family Day Care Pty Ltd (SMFDC) to review a decision by the Secretary, Department of Education and Training, to cancel SMFDC's approval as a child care service. The cancellation meant SMFDC was no longer eligible for child care benefit or child care rebate. The Administrative Appeals Tribunal was required to determine whether SMFDC had breached its conditions for continued approval and, if so, whether cancellation was the correct or preferable sanction.

The legal issues before the Tribunal were whether SMFDC had breached its obligations as an approved child care service and, if so, whether the cancellation of its approval was the appropriate response. SMFDC, through its legal representative, argued that the Department had not fully considered its innovative strategies to address non-compliance, that operational difficulties made monitoring challenging, and that it was entitled to rely on educator timesheets. SMFDC also contended that the number of contraventions was relatively small, that some educators had apologised and agreed to repay funds, and that a conspiracy between educators and parents had occurred. Furthermore, SMFDC argued that it had not knowingly or recklessly misled the Department and that earlier guidance should have been provided.

The Tribunal found that SMFDC had not complied with its statutory requirements. The scale, repetitive nature, and seriousness of the non-compliances were described as reckless breaches of SMFDC's approval. This recklessness was evidenced by claims for sessions of care even when educators reported children were absent, or when the number of children in care exceeded regulatory limits. The Tribunal noted that SMFDC claimed for 4,036 sessions of care where an educator or child was overseas, resulting in approximately $70,000 in incorrect payments. Additionally, SMFDC failed to record any absences out of nearly 135,000 reported sessions of care, and on 141 days, claims were made for care involving more than the permitted seven children. In light of these findings, the Tribunal concluded that cancellation of SMFDC's approval was the preferable sanction.

The decision under review was affirmed.