EXPLANATORY STATEMENT
Child Care Benefit (Eligibility of Child Care Services for Approval and Continued Approval) Amendment Determination 2008 (No.1)
Summary
This Determination is made under subsection 205(1) of the A New Tax System (Family Assistance) (Administration) Act 1999 (the Family Assistance Administration Act).
This Determination 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 (Eligibility of Child Care Services for Approval and Continued Approval) Determination 2000 (the Approval Determination) that sets out the rules for child care services to become, and remain, approved for the purposes of child care benefit (CCB).
Under the A New Tax System (Family Assistance) Act 1999, a person may be eligible for CCB for child care provided by an ‘approved child care service’. An ‘approved child care service’ is a service approved under section 195 of the Family Assistance Administration Act. To be approved, and continue to be approved, a child care service must comply with the conditions specified in the Approval Determination. Failure to comply with any of the conditions may result in a sanction being imposed on the service at the Secretary’s discretion (section 200 of the Family Assistance Administration Act refers).
This Determination amends the Approval Determination to impose a new condition of approval of a child care service. The new condition is that applicants undertake that the service will be equipped, including having software registered by the Secretary under subsection 4(3) of the Family Assistance Administration Act, and have the operational capacity to use the electronic equipment for the purpose of compliance with the conditions of continued approval imposed on an approved child care service by subsection 196(2) of the Family Assistance Administration Act.
If the applicant cannot make such an undertaking the service will not be approved for the purposes of the family assistance law.
Background
Schedule 1 of the Family Assistance Legislation Amendment (Child Care Management System and Other Measures) Act 2007 (the CCMS Act) made amendments to various provisions of the Family Assistance Act and the Family Assistance Administration Act relating to the introduction of the Child Care Management System (CCMS). CCMS requires approved services, amongst other things, to communicate with the department using electronic means (such as an electronic interface) established and maintained by the department for this purpose, and use software registered for this purpose by the Secretary.
The CCMS amendments commenced on 1 July 2007, but start applying to an already approved service after the service’s particular ‘application day’ determined for each approved service separately under item 91 of the CCMS Act. Generally, the legislative intention is that all approved child care services will operate under CCMS by 1 July 2009. The application day of the existing approved child care services is being determined having regard to both a service’s operational capacity, and the policy need to effect the transition to CCMS of all the approved service by that date. The government made an election commitment to fast-track the transition of approved services to the CCMS. To achieve this, services seeking new approval will have to be prepared to operate after their approval in accordance with the CCMS requirements.
Amendments to the Approval Determination therefore make it a condition of approval that the person who applies for approval of a child care service under the family assistance law must undertake to be equipped, and have the capability, to use electronic interface and CCMS software. If the undertaking is not provided, the approval cannot be granted.
Consultation
The Government made an election commitment to fast track CCMS in its Affordable Child Care Plan. The department is implementing this commitment by minimising the number of services that go onto the Childcare Operator System (COS), the predecessor of CCMS. In addition COS is unable to accept new services from 8 December 2008 as it is progressively decommissioned during the transition of services to CCMS. The department has advised the child care sector via Industry Reference Group meetings and extensive regional advice presentations and has promoted the COS closure and the impact of that on new approvals on its website
Preliminary Assessment
A preliminary assessment of the impact of this amendment has been undertaken in accordance with the procedure established by the Office of Best Practice Regulation; this amendment has been assessed as having a low or no impact on business, individuals and the economy. The amendment has a negligible impact on child care services seeking approval given that, under existing legislation all approved services will, be transitioned to the CCMS system by 1 July 2009. The amendment will ensure that newly approved services will operate under CCMS, and not be disadvantaged by having to operate under COS for a period and then change to CCMS.
Explanation of sections
Name of Determination
Section 1 states the name of this Determination
Commencement
Section 2 states that this Determination commences the day after it is registered
Amendment of Approval Determination
Section 3 states that Schedule 1 amends the Approval Determination.
Explanation of items in Schedule 1
Items 1 and 2 – Definitions
Items 1 and 2 amend section 3 of the Approval Determination to insert new definitions of ‘electronic interface’ and ‘registered software’.
‘Electronic interface’ means electronic equipment approved as a way of making or withdrawing an application or claim under the family assistance law, doing a thing under the law or giving notices by the Secretary under the law.
‘Registered software’ means software registered under subsection 4(3) of the Family Assistance Administration Act.
Item 3 – Capacity to use electronic interface
Item 3 inserts new section 14C into the Approval Determination. New subsection 14C(1) states that an applicant for approval of a child care service for the purposes of the family assistance law must undertake that the service will be equipped to use the electronic interface (including by having registered software) to comply with the condition of continued approval imposed by subsection 196(2) of the Family Assistance Administration Act. As a result, if an applicant does not provide that undertaking, the service will not be approved.
New subsection 14C(2) states that the applicant must undertake that the service will have the operational capacity to use the electronic interface to comply with the condition of continued approval at subsection 196(2) of the Family Assistance Administration Act. If the applicant does not have such operational capacity, the service will not be approved.