Australia 'failing' on childcare quality issues

Commenced in August, the inquiry was sparked by calls for reform after a series of high-profile scandals including claims of sexual abuse, unnecessary restraints and low-quality meals in the sector.

In its submission to the inquiry, the Early Learning Association Australia said changes enabling the federal government to strip providers of subsidies if they don't meet safety standards was "a welcome step", but did not go far enough.

Since the changes, it said there had been action against 30 services out of more than 15,000 subsidy-approved operators in Australia.

That equates to less than 0.2 per cent of the sector.

"It is not a comprehensive, systemic solution to quality. Quality needs to be more than just ensuring a minimum level of child safety," said the association, which represents more than 1300 providers, most of them not-for-profits.

Another group set to testify, the Federation of Parents and Citizens Associations of NSW, warned of corporate interests pushing out community-based players in the sector.

It blamed the trend on tendering and licensing policies in NSW, which it said were "in favour of large multi-site operators".

"This trend towards corporatised consolidation has been evident in other states - notably Victoria and Western Australia - raising concerns about quality, safety and the erosion of local engagement," the association said in a submission.

Australian Industry Group, an employer body, warned that companies were diverting "significant time and money to ensuring compliance and avoiding inadvertent non-compliance" due to industrial relations changes.

It cited, in its submission, the start of wage theft laws as one change putting a greater compliance burden on employers which had the potential to distract from ensuring "optimal quality and safety outcomes".

Public hearings move to Brisbane and Canberra next week, with the inquiry due to report by the end of March.