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Child safety in focus as government moves to strip funding from non-compliant providers
Fiona Alston
Jul 23, 2025
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Early childhood education and care (ECEC) providers that repeatedly fail to meet safety standards could lose access to government subsidies under legislation being introduced to Parliament this week.
The proposed changes, brought forward by the federal government would enable funding delivered through the Child Care Subsidy (CCS) to be withdrawn from providers found to be consistently breaching safety requirements. However, details on what constitutes a "repeated failure" have not been disclosed.Education Minister Jason Clare said the legislation is intended to drive improvement across the sector, not to penalise services but emphasised the need to ensure children’s safety remains paramount.
Currently, the Department of Education can withdraw CCS approval where there is an imminent risk to a child’s safety or wellbeing. The new legislation would elevate safety considerations in decisions around subsidy access and provider eligibility.
Minister for Early Childhood Education Jess Walsh echoed the government’s stance, stating:
“Every child deserves to be safe in early learning, and every parent deserves to know their child is protected. This legislation targets providers that put profit ahead of safety.”
The legislative move comes amid wider concerns about quality, availability and safety in the ECEC sector. Recent reviews from the Australian Competition and Consumer Commission (ACCC) and the Productivity Commission have highlighted systemic issues relating to access and workforce capacity.
Next month, state, territory and federal education ministers will meet to consider further reforms, including:
- Establishing a nationwide educator register,
- Expanding the use of CCTV in early learning environments,
- Requiring mandatory training to detect and prevent child abuse,
- Introducing compulsory bans on mobile phones and devices in services.
These discussions will build on the updated National Quality Standards (NQS), which from September will require providers to report allegations or incidents of sexual abuse within 24 hours, replacing the current seven-day timeframe.
While the proposed legislation has been broadly welcomed, some stakeholders argue more systemic reform is needed. The Greens, who have pledged to support the changes, are calling for the creation of a national watchdog to ensure consistent enforcement of quality standards across all jurisdictions.
Greens early childhood education and care spokesperson Steph Hodgkins-May said the existing “patchwork” of regulation was not sufficient to prevent serious failures:
“We need proactive, structural reforms that prevent poor-quality care before harm occurs, not just punitive measures once it’s too late.”
The Coalition has also expressed support for the bill, noting the importance of ensuring that any measures enacted result in tangible safety improvements.
While the government has not yet defined the specific criteria that would trigger funding withdrawal, the proposed changes send a strong signal: failure to meet minimum safety standards could now carry financial consequences.
For providers, the focus is likely to shift further toward risk management, training and transparent compliance with the NQS.
With national standards evolving and a broader regulatory framework under review, this legislation may represent a turning point in how safety is monitored and enforced in early learning environments across Australia.
To read the original coverage of this story, as produced by the ABC, please see here.
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