Helping Hugs Werribee directors allowed to be registered and return to running the business

The directors of a chain of daycare centres in Melbourne’s west are able to return after a three-year ban for “a history of contraventions”.

Directors of a chain of family daycare centres branded reckless by federal auditors will be able to operate their business again after a three-year ban.

The directors of Helping Hugs in Werribee were found to have taken $65,000 in taxpayer money for care that could not have taken place. This includes care for children or staff that were overseas at the time.

The chain of family day care educators has been given up to $13 million in federal childcare subsidies since 2013 for care provided at services in and around Hoppers Crossing, Laverton, Point Cook, Tarneit and Truganina.

Offering day and even overnight care, the service’s motto is “a hug above the rest”.

Helping Hugs Werribee directors were branded reckless by federal auditors. Picture: iStock

However, an audit in 2019 found the directors, Fadzai Simango and Savani Punj, failed to properly account for the children cared for, did not monitor educators and did not conduct enough home visits. Their registration to run the business was cancelled.

The service, which had received previous noncompliance notices, also breached ratios covering the number of staff looking after children, the auditors claimed.

The concluded the directors had “a history of contraventions over a four-year period” and had a “deliberate and reckless disregard” for the relevant law.

The directors appealed and this week the Administrative Appeals Tribunal (AAT) affirmed that they were responsible for around 4000 sessions which breached federal rules. This includes receiving money for children cared for in their own homes, for secondary school students, and for students who were swapped with others.

The Helping Hugs Werribee directors are able to operate their business again after a three-year ban. Photo: iStock

But AAT member Anna Burke ruled the directors could be registered and return to running the business as long as they don’t have employ more than 45 educators caring for no more than 315 children.

Parents must also pay the centre, not individual staff.

Ms Burke concluded that Ms Simango and Ms Punj had “demonstrated a significant and frequent history of noncompliance and misreporting, across numerous areas, resulting in a significant number of breaches”.

“The Tribunal is not satisfied that Helping Hugs had adequate oversight, governance and systems in place to meet its obligations under the Act,” Ms Burke said.

She said the women were naive, lacked insight and did not have “solid business acumen to ensure they were accurately and appropriately dealing with taxpayer’s dollars”.

However, Ms Burke concluded that they had made genuine efforts to meet their obligations and “were dedicated to offering a pedagogically sound childcare service”.

“The Tribunal was impressed by both directors’ passionate commitment and dedication to providing the best quality care to children, particularly to families from diverse multicultural backgrounds and in lower socio-economic areas,” Ms Burke said.

She said the breaches were not deliberate or fraudulent and mostly resulted from “human error and system failure”.

Lawyers for the directors said the alleged breaches made up 0.14 per cent – a “tiny fraction” of their 1.9 million total care sessions since 2013.

The directors have been contacted for comment.

A Department of Education spokesperson said the health, safety and wellbeing of children is always the priority.

“There is a legally enforceable approval process for businesses which care for and educate children to ensure the safety of children using the services,”she said.