Billan Family Day Care loses approved provider status

A family day care operator in Melbourne’s inner west has been embroiled in a child subsidy scandal worth almost $800k.

Billan Family Day Care, which operates 51 child care centres in Victoria, including one in Footscray, has been stripped of its approved provider status.

A Maribyrnong childcare operator has been embroiled in a scandal involving almost $800,000 worth of subsidy payments.

Billan Family Day Care, which employs 51 family day care operators in Victoria, including one in Footscray, was stripped of its approved provider status by the Education Department in May.

On Monday, the Federal Court upheld the department’s decision on appeal by the company’s owner, Sagal Ahmed Mohamed.

It means families who have children cared for by Billan will no longer be able to claim childcare subsidies through the business, which are designed to help offset the full cost of care.

Evidence submitted to the court revealed $788,905 worth of fraudulent childcare subsidies were claimed through the company, which has been in operation since 2009.

Some children were overseas at the time they were purportedly being cared for by Billan.

Others lived in an entirely different state to their supposed daycare provider, the court heard.

Dodgy subsidy claims also included children in the care of other childcare operators and for children who were at home at the time of care.

Most of the payments — about $667,687 — were claimed for care when a genuine legal liability to pay for childcare did not exist, the court heard.

Justice Michael O’Bryan said evidence submitted to the court showed the business failed to meet educator to child ratios on a number of occasions.

It also kept poor company records and information about staff, including their names and working with children checks, which in some cases were missing or inaccurate.

Quoting the department’s evidence, he said it found the fraudulent claims were pervasive and serious.

“The non compliance is serious in nature due to the large number of different types of contraventions, the quantity and ongoing repetition of contraventions,” he said the department found.

“Furthermore, I consider it is of serious concern that the safety, health and wellbeing of children may have been placed at risk.”

Billan Family Day Care employs seven family day care providers in NSW.

Its operations in Queensland closed earlier this year.

In her evidence to the court, Ms Mohamed submitted that 166 families relied on her company for care, including about 362 children.

Most came from migrant backgrounds and were from low socio-economic communities, she wrote in her affidavit.

Justice O’Bryan said he did not place much weight in some of the company’s explanations for the improperly claimed subsidies, including that some claims were made by mistake or were due to an “administrative error”.

He said the company’s claim it had implemented new processes to ensure similar mistakes didn’t happen again was also “ineffectual”.

The department was not able to determine if Billan, its staff or the children’s parents had acted deliberately in lodging the improper claims, Justice O’Bryan said.

But it found Billan “demonstrated a reckless disregard” for its obligations under the family assistance law and Ms Mohamed failed to properly investigate the matters when they were brought to her attention by the department.

Ms Mohamed had hoped to have the department’s decision in May overturned.

Instead, the court upheld the department’s decision and ordered a stay on the decision to cancel the company’s approved provider status be lifted before the end of the month.