NSW daycares face whopping $500k fines. Will this ensure safety?

The New South Wales government has proposed huge fines to crack down on childcare providers who breach safety rules.

New laws, introduced to state parliament on Wednesday, would increase the maxiumum fine to A$500,000 for large providers (who own 25 or more services) that don’t comply with safety regulations.

This is a 900% increase on previous penalties.

This follows a raft of reports of unsafe practices in the early childhood sector, including a grandparent taking the wrong child home at pickup, and a child running onto a busy road while in care. It also comes after horrific reports of abuse in centres this year.

Will the fines work? What else do we need to see in early childhood services to ensure safety?

Big new penalties

Half a million dollars is certainly a lot of money. This amount may surprise families who look at their local childcare centre and wonder “how do they have money like that?”.

The early childhood sector is made up of a mix of providers.

Just over half (54%) are run by private, for-profit providers. Some of the bigger childcare providers are listed on the Australian Stock Exchange.

The size of providers also varies. As of July 2025, 31% of all services were run by a small provider (with just one service), 32% were run by providers with between two and 24 services, and 36% were run by providers that had 25 or more services.

Will hefty fines work?

If we want to know whether the new penalties will work, we have to ask why services are breaching safety regulations in the first place.

Is it because they are not paying attention? Or because they are focusing on profits over quality? If so, perhaps big fines will motivate them be more careful and take safety more seriously.

But services may be having trouble meeting the rules for other reasons. We know there is a complex compliance regime, with both federal and state/territory components – as the national quality authority noted in a December 2023 report.

We need to support services to understand their obligations and how to meet them, by making requirements clearer and simpler to meet and resourcing services and educators appropriately.

Prevention or punishment?

This gets back to a broader point that I and other early education experts have been making about safety in the early childhood sector.

Yes, the community is understandably angry and worried about how children are cared for when they go to daycare.

But we can’t simply focus on punishments and catching problems after they have happened (through bigger fines or via CCTV). We need to set the system up so that services are both committed to and able to provide safe, quality early education and care.

One way to do this is serious investment in staff training and working conditions. This means educators have the skills, time and capacity to look out for children’s safety and spot potential problems before they occur.

At the moment, there is a persistent shortage of qualified educators, compounded by high turnover in the sector. As my research shows, educators are experiencing heavy demands that diminish quality time with children.

A word about trust

The NSW government says it wants its new laws to do two things: “prioritise the safety and wellbeing” of children and “restore parents’ trust in early childhood education and care”.

The federal governmnet has similarly spoken of the need to “rebuild” trust and confidence in the sector.

I would like to add a note of caution here.

We don’t want childcare reforms to turn into a rebranding exercise, just so people feel better about the sector. We actually need to see meaningful change, that focuses on quality for children and that supports services and educators to do their jobs well.