Over the past 12 months, the early learning and childcare sector has undergone its most significant reform since the National Quality Framework (NQF) was introduced. The reform comes off the back of the Australian Children’s Education & Care Quality Authority’s (ACECQA) 2023 review of child safety arrangements under the NQF. These reforms were a timely response to intense media scrutiny, heightened frequency of reported incidents, and allegations of systematic abuse within the sector.
The most recent round of reforms, which came into effect on 27 February 2026, have major implications for providers, including the strengthening of existing regulations, the addition of new regulations plus the introduction of new statutory offences, which create an uninsurable exposure for both entities and their natural persons / office holders.
Recent enforcement action
Six months on from the February rollout, we observe that tightened regulation has been followed by increased regulatory action including a significant uptick in investigations and penalties.
ACECQA’s own Q2 2026 data confirms this trend:
- A total of 1,538 compliance actions in the quarter, more than double the 735 recorded in the same period last year.
- 589 provider approval cancellations, more than 20 times the same period last year.
- Over 6,000 regulator visits.
Statutory offences and associated insurance implications
Fines under the reformed National Law have increased, and these penalties are structured to be uninsurable, meaning if a regulator names a director or officer personally, that individual carries the liability directly rather than the entity’s insurance programme. As a result, procedural strictness and strong governance are more critical than ever as the primary line of defence.
The insurances impacted by these provisions are Directors & Officers Liability (D&O), Employment Practices Liability (EPL), and Statutory Liability. Insurances of this nature typically contain mechanisms that exclude payment of fines and penalties which are not legally insurable pursuant to statute or common law. However, it’s worth noting that defence costs relating to investigations and prosecution into alleged breaches generally remain insurable and would typically be covered under a standard D&O, EPL, or Statutory Liability insurance policy. As always, the bespoke terms and conditions of each policy should be carefully reviewed to confirm coverage.
With the penalty itself off the table for insurance, the pressure is on childcare providers to ensure proactive risk management and solid governance are in place. The reforms call on services to:
- Reinforce proactive risk management
- Strengthen leadership and governance expectations
- Support more consistent and transparent practice
- Embed child safety within leadership structure ensuring best practice filters down to all team members
How Bellrock can assist with proactive risk prevention
Bellrock has partnered with leading abuse prevention specialists Praesidium to deliver an assessment into your organisation’s abuse prevention framework with a view to improving prevention for organisations that serve vulnerable populations.
As part of the process, Praesidium uses its own risk management model called The Praesidium Safety Equation® to undertake a root cause analysis. By implementing best practice in each of these operations, Praesidium helps reduce or in some cases fully eliminate abuse risks. For further information, please reach out to a Bellrock advisor.
Background: Summary of key National Framework reforms
Below is a high-level summary of recent reforms published by ACECQA.
| Reform area | Key change | Commencement |
|---|---|---|
| Safe use of digital technologies | Mandatory policies and procedures covering devices, CCTV, images and online environments | 1 September 2025 |
| Earlier abuse notifications | Reduced reporting timeframes for physical and sexual abuse notifications, from 7 days to 24 hours | 1 September 2025 |
| Vaping prohibition | Vaping substances and devices prohibited in education and care environments | 1 September 2025 |
| Extended limitation periods | Regulatory authorities now have longer periods to commence proceedings | 10 December 2025 |
| “Stop the clock” provisions | Regulators can pause limitation periods during external investigations | 10 December 2025 |
| Expanded information sharing | Regulatory authorities can obtain and share information including recruitment agency information | 10 December 2025 |
| False information offence | Offence created for persons subject to prohibition notices giving false or misleading information | 10 December 2025 |
| Strengthened National Quality Standard | Quality Areas 2 (Children’s Health and Safety) and 7 (Governance and Leadership) revised with stronger child safety focus | 1 January 2026 |
| Increased penalties and expanded use of Penalty Infringement Notices | Maximum penalties increased and more contraventions capable of attracting infringement notices | 2 January 2026 |
| Paramount consideration obligation | Children’s safety, rights and best interests become the paramount consideration | 27 February 2026 |
| Mandatory child protection training | Mandatory training extended to all staff, volunteers and students | 27 February 2026 |
| Mandatory child safety training | Nationally consistent child safety training introduced | 27 February 2026 |
| Device management requirements | Restrictions on use of personal devices around children | 27 February 2026 |
| Expanded regulator powers | Greater powers to investigate and respond to misconduct | 27 February 2026 |
| Stronger Working With Children Check requirements | Enhanced worker screening requirements | 27 February 2026 |
| Related provider monitoring | Enables identification and monitoring of related entities | 27 February 2026 |
| Expanded family day care inspection powers | Increased entry and inspection powers | 27 February 2026 |
| National Early Childhood Worker Register | Establishment of a national register of workers | 27 February 2026 |
