Early childhood education and care providers must comply with the rules under Family Assistance Law (FAL). On this page you’ll find out more about what you need to do to comply with FAL.
On this page:
Family Assistance Law sets the rules for administering Child Care Subsidy (CCS). Providers must be familiar with and comply with the law.
You must also ensure your services, relevant staff and educators comply with their obligations under Family Assistance Law.
Providers have a range of obligations under Family Assistance Law. We regularly check providers are fulfilling their obligations and take compliance action when they’re not.
Persons with management or control
Providers have specific legal obligations. These obligations are completed by certain people. We call these people ‘persons with management or control of the provider’. They are also called ‘persons with management or control’ or simply ‘PMC’.
Fit and proper requirements
Certain people at a service must be considered by us to be ‘fit and proper’ to handle public money.
Certain people at a service must have background checks. Providers must have evidence of these checks. In some cases, providers must report the details of the checks to us.
All educators and some PMCs must have a working with children check.
Working with children checks are issued by state and territory governments. However, providers have specific reporting obligations under Family Assistance Law.
An inducement is an incentive offered by a provider to secure a child’s enrolment. Early childhood education and care providers may offer only certain types of inducements.
Collecting gap fees
Families who get CCS must make a co-contribution to their early childhood education and care fees. They do this by paying the gap fee.
Families must pay the gap fee using electronic funds transfer, or EFT.
Providers must take all reasonable steps to collect gap fees from families using EFT.
Reporting to the department
Providers must submit accurate session reports on time – it’s the law. Services Australia uses session reports to calculate and process CCS payments.
Providers must report a range of other matters to the department, within set timeframes, to maintain approval.
Large providers have additional reporting requirements. They must report financial information, including information about revenue, profits, and leasing arrangements.
We may take compliance action if you fail to meet your obligations. Compliance action could include:
- putting conditions on your approval
- issuing an infringement
- suspending or cancelling your approval.
The actions we take will depend on:
- the severity of the non-compliance
- your past behaviour or compliance history
- your response to any earlier non-compliance action
- overall trends of non-compliance in the sector.
Child Care Provider Handbook
The Child Care Provider Handbook outlines the legal requirements and responsibilities of running a child care service.
Watch a series of short videos on key compliance topics to ensure you’re doing the right thing.
Keeping the system fair
Send a tip-off
If you think a child care service is doing something illegal or fraudulent or is trying to get an unfair advantage, you can tell us anonymously.
Illegal activities include:
- not complying with reporting and administration obligations
- not providing appropriate staff or conditions
- operating without proper registration, including the type of service provided.
Providing information to the department
You may get a section 158 notice if we think you have information, documents or records that will help us administer Family Assistance Law.
A section 158 notice is a legal document requiring you to provide us with information.
Information sharing and data matching
Most providers do the right thing. There are a few who exploit government programs by claiming payments they aren’t entitled to.
We work with other agencies, like the Australian Tax Office (ATO) and law enforcement, to deal with suspected:
- criminal activities.
When we collaborate with these agencies we:
- exchange data
- share intelligence and information
- engage in joint activities
- share referrals, tip-offs and compliance outcomes.
We also participate in the ATO’s Government Payments Program. The program ensures service providers getting government payments are meeting their tax and superannuation obligations.
Compliance pilot project
We are stepping up our efforts to detect and prevent child care fraud. Throughout 2022 and 2023, we are partnering with authorities in NSW and Victoria on a compliance pilot project.
Child Care Enforcement Action Register
The Child Care Enforcement Action Register lists services that have been penalised for breaking the law.