EXPLANATORY STATEMENT
Child Care Benefit (Allocation of Child Care Places) Amendment Determination 2006 (No. 1)
Summary
This Determination is made under section 206 of the A New Tax System (Family Assistance)(Administration) Act 1999 (the Act). It is a legislative instrument for the purposes of the Legislative Instruments Act 2003.
The purpose of this Determination is to amend the Child Care Benefit (Allocation of Child Care Places) Determination 2000 (the Allocation Determination), that sets out the guidelines regarding the allocation of child care places to specified kinds of child care services approved for child care benefit (CCB) purposes.
This Determination amends the Allocation Determination with the effect that, from 1 July 2006, the Allocation Determination, and therefore the requirement to operate within the limit of places allocated under the Determination, will cease to apply to family day care services or outside school hours care services.
Background
Subsection 195(1) of the Act provides for the approval of a child care service for the purposes of the family assistance law. The kinds of services that may be approved include centre based long day care services, family day care (FDC) services, in-home care services, occasional care services and outside school hours care (OSHC) services (section 194 refers).
If the Allocation Determination made by the Minister under section 206 applies to a service, the service may only be approved if places would be allocated to the service (paragraph 195(1)(d) refers).
The Allocation Determination includes guidelines for the allocation of places to specified kinds of services. The Determination currently in force applies to ‘an approved family day care service, an approved in-home care service, an approved occasional care service or an approved outside school hours care service’ (subsection 3(1) of the Allocation Determination refers).
If places are available for allocation to a service to which the Allocation Determination applies, and the Secretary approves the service, the Secretary must allocate places to the service (section 207 of the Act refers). The service may then apply for additional child care places under subsections 207(2). In making a decision about allocation of places to a service, the Secretary must refer to the criteria established in the Allocation Determination.
Once places are allocated, it is then a condition of a service’s continued approval under section 197 of the Act that the service does not exceed the number of places allocated to it.
The effect of the amendments made in this Determination is that from 1 July 2006, approved FDC and OSHC services will no longer be subject to the allocation regime. The allocation of child care places to FDC and OSHC services will, from 1 July 2006, no longer be a condition of the Secretary’s approval under section 195 of the Family Assistance Administration Act. The condition of continued approval in section 197 of the Family Assistance Administration Act (requiring that a service does not exceed the number of places allocated it under section 207) will cease to apply to FDC and OSHC services. This aligns the position of FDC and OSHC services with the existing position in relation to centre based long day care services (that are not subject to the Allocation Determination).
The Allocation Determination will continue to apply to approved occasional care services and approved in-home care services.
The amendments will not have the effect of prejudicing the rights and liabilities of any person other than the Commonwealth.
Consultation was unnecessary because the amendments give effect to the decision announced in the 2005-2006 Budget to remove the existing limitations on the number of places that FDC and OSHC services are able to provide.
The Office of Regulation Review (ORR) has advised that a Regulation Impact Statement (RIS) is not required for this Determination (ORR ID # 8094 and 8132).
Explanation of the sections
Name of Determination
Section 1 states the name of this Determination.
Commencement
Section 2 states that this Determination commences on 1 July 2006.
Amendment of the Allocation Determination
Section 3 states that Schedule 1 amends the Allocation Determination.
Explanation of the items in Schedule 1
Amendments made in this Schedule remove from the Allocation Determination all the references to FDC and OSHC services and insert a new application provision restricting the application of the Allocation Determination to in-home care and occasional care services.
Item 1 - definition of ‘child care place’
Section 3 is an interpretation provision in relation to the meaning of words used in the Allocation Determination. Item 1 replaces the current definition of ‘child care place’ with a new definition that does not contain references to a place in an FDC or an OSHC service.
The new definition replicates the current meaning of a child care place in relation to an approved in-home care service (as one full time place of 35 hours per week which may be occupied by one child or by two or more children attending on a part time basis) and in relation to an approved occasional care service (as one full time place of 40 hours per week which may be occupied by one child or by two or more children attending on a part time basis).
Item 1 also removes from section 3 the definition of ‘JET child care place’ and ‘JET Program’ used in the context of the provisions relevant to FDC services omitted by Items 7 and 8.
The definition of ‘approved child care service’, which specifies the kinds of services covered by the Allocation Determination, is also removed by item 1. Instead, a new application provision is inserted by item 2.
Item 2 - Application
Item 2 inserts new section 3A specifying that this Determination applies in relation to the allocation of child care places to an approved in-home care service or an approved occasional care service.
Item 3 - amendment to paragraph 7(1)(b)
Subsection 7(1) of the Allocation Determination requires the Secretary to determine the areas of Australia in which child care places may be allocated and the number of places for each kind of service to which the Allocation Determination applies.
Item 3 amends paragraph 7(1)(b) by removing the references to ‘approved family day care services’ and ‘approved outside school hours care services’. The effect of the amendment is that the Secretary is required to determine the areas of Australia in which child care places may be allocated (paragraph 7(1)(a)), and the number of child care places for approved in-home care services or approved occasional care services in each area (paragraph 7(1)(b)).
Item 4 - amendment to subsection 7(2)
Paragraphs 7(2) (b) and (c) authorise the Secretary to divide the number of places allocated to areas for FDC and OSHC services so that, within the allocated limits, places are set aside for a specified purpose, eg. for vacation care in OSHC or for JET Program in FDC. Item 4 substitutes new subsection 7(2) which does not contain current paragraphs 7(2)(a) and (c).
New subsection 7(2) incorporates the current paragraph 7(2)(a) and provides that a determination under subsection 7(1) (relating to a number of places in specified areas) may also divide the number of child care places determined by the Secretary for allocation in a particular area into numbers of places which may be allocated in respect of children in particular age groups.
Item 5 - amendment to paragraph 7(4)(a)
Paragraph 7(4)(a) provides that, while allocating places to a particular service, the Secretary must take into account the number of places allocated for these kinds of services in the area in which the service operates. Item 5 amends paragraph 7(4)(a) to clarify that, in the process of allocation, the Secretary also has to take into account any limit of places for children in a particular age group determined by the Secretary under subsection 7(2).
Item 6 - amendment to subsections 7(4A) and (4B)
Item 6 omits subsections 7(4A) and (4B) relating to the allocation of a JET child care place to an FDC service. This amendment is consequential on the amendments to subsection 7(2) made by item 4.
Item 7 - amendment to subsections 8(3) and (4)
Section 8 deals with notice of allocation, and subsection 8(1) requires the Secretary to give the operator of an approved service notice in writing of the service’s allocation of places.
Item 7 omits subsection 8(3) relating to the requirement to notify an FDC service of the allocation of a JET child care place in accordance with subsection 7(4A).
Item 7 omits subsection 8(4) relating to the requirement to notify an FDC service of any variation of a period for which a JET place is allocated. These amendments are consequential on the amendments made to subsection 7(2) by item 4.
Item 8 - Transitional- applications made, but not determined, before 1 July 2006
Item 8 inserts, after Part 2, new Part 3 containing transitional provisions relating to initial and additional allocations of child care places applied for before 1 July 2006 and undetermined before 1 July 2006.
New section 9 deals with initial allocations under subsection 207(1) of the Family Assistance Administration Act with respect to an application for approval by an FDC or OSHC service made, but not determined, before 1 July 2006.
The intended result of new section 9 is that where an application for approval is made by an FDC or OSHC service before 1 July 2006 but is not determined as at 1 July 2006, a determination of initial allocation of child care places under subsection 207(1) will be made in accordance with this Determination as in force on 1 July 2006.
That is, the Allocation Determination as amended will apply with the effect that there will be no initial allocation of child care places to an FDC or OSHC service in relation to an application for approval lodged before 1 July 2006 but determined after 1 July 2006.
New section 10 deals with applications for additional allocations for FDC and OSHC services under subsection 207(4) of the Family Assistance Administration Act made, but not determined, before 1 July 2006.
The intended result of new section 10 is that where an application for an additional allocation of child care places is made by an FDC or OSHC service before 1 July 2006 but is not determined before 1 July 2006, a determination of additional places under subsection 207(4) will be made in accordance with this Determination as in force on 1 July 2006.
That is, the Allocation Determination as amended will apply with the effect that there will be no additional allocation of child care places to an FDC or OSHC service in relation to an application for additional allocations lodged before 1 July 2006 but determined after 1 July 2006.
The effect of the transitional provisions is that the new amendments will apply retrospectively (to applications for allocations made but undetermined before the amendments commence). Such an application of the amendments is either beneficial, because it removes the restriction on the approval of FDC and OSHC services without any initial allocation of places (as it would previously have been the case), or not prejudicial to the rights of a service or any other person (other than the Commonwealth).