Hello to all
I really would like to get a gauge on this topic and see what people's opinion is on this. You dont need to be a parent, use some basic logic and common sense
A childcare centre that I have recently enrolled my son into has taken a bond payment from me. It's not as though i wanted to pay this, and I am very uncomfortable with it, however the childcare centre would not take an enrolment without this bond payment.
As a guide, the bond payment taken per day is $125 and you need to pay 2 weeks in advance. So, if you have your child in childcare for 4 days a week then it $125 x 4 ($500) and then double this as you need to pay weeks in advance, so a $1000 bond if you have your child in childcare for 4 days per week.
Lets assume the childcare centre capacity is 100 children, and they are all in 4 days per week. So now, the childcare centre is holding $100,000 of individuals and families money. It is not controlled, it is not policed, it is not governed in any way. Nothing.
I want to question this as I do not feel it is at all appropriate, or legal.
A childcare business is not in the business of managing funds, which is essentially what they are doing by taking bond payments from parents. They are in the business of childcare.
They are not an ADI (https://www.apra.gov.au/register-of-authorised-deposit-takin...), they do not hold an AFS licence (https://asic.gov.au/for-finance-professionals/afs-licensees/...) and they can not be allowed to take and hold money from individuals.
I do not want a childcare centre managing my money in any way, and that is exactly what is happening here. I could, and would, use this money to invest in cash or equities if it wasn't in the hands, or rather the bank accounts, of the childcare centre.
This bond payment held by the childcare centre is in no way guaranteed or secured, unlike a bond lodged with the RTBA for example (https://www.consumer.vic.gov.au/bondauthority).
What if this childcare centre goes into liquidation?
What are they doing with this money? Who would know?
These bond payments collected by the childcare centre, at the very least, I am sure, are earning interest on cash for which the owners of the childcare centre benefit, but the owners of the cash do not. It is obviously not right at all.
How can this be legal? This is my money, and someone else is benefiting from investing it under the guise of it being a "bond" payment.
If there must be a bond, which is extremely questionable to start with, then these bond payments must not be held by the childcare centres
There needs to be a system, exactly the same as the RTBA works for rental property
Poll Question: Is it right for childcare centres to take a bond?