ACA National urges caution around enrollment incentives as ECEC competition grows

The national branch of the Australian Childcare Alliance (ACA) has called for caution in relation to the use of marketing and incentives for early childhood education and care (ECEC) centres to increase enrolments to their service, concerned about breaches of a variety of laws and policies. 

Increased competition in the ECEC sector, along with oversupply in some areas, has led to “strong branding and marketing campaigns”, ACA said, some of which include incentives for families to enrol, such as free ipads, reduced fees, two weeks of free care, or other services. 

Discussions about incentive payments have been in the public eye for some time, with a number of influential voices within and outside the sector sharing their perspectives. 

Those who choose to incentivise, ACA said, should carefully consider relevant laws before doing so. Approved providers should ensure that their commercial practices comply with Family Assistance Law, and all other legal requirements, ACA noted. 

For example, Child Care Subsidy (CCS) is an entitlement for families and is paid only to reduce fees. While CCS is paid directly to providers, the approved provider is by law required to pass on the full subsidy amount to the family as a reduction of fees. 

Providers are also required, by law, to report accurate details about each session of care, including the actual fee charged for a session. In the event that a parent was charged nothing for a session, or was charged a lower than usual fee as part of an incentive offer, the provider MUST accurately reflect this in the relevant session report/s, ACA said. 

In addition to Family Assistance Laws, providers must also ensure that the arrangements made with parents and carers, including those in relation to incentives offered, comply with relevant state or territory consumer protection laws.