Stricter screening needed to prevent fraud in nursery subsidy applications

The Yomiuri ShimbunScreenings were likely lenient because of a desire to rapidly increase the number of facilities.

Two people, including the head of a childcare consulting company in Fukuoka city, have been arrested by the special investigation squad of the Tokyo District Public Prosecutors Office on suspicion of fraudulently receiving more than ¥200 million in state subsidies in connection with nursery schools built by employers mainly for their employees.

The suspects fraudulently received part of construction costs by allegedly forging contracts with contractors in connection with projects to build nurseries in the cities of Nagoya and Fukuoka, among other allegations.

With a view to preventing recurrences of similar fraud cases, it is necessary to elucidate what kind of screening was conducted and why misconduct could not be identified.

Employer-backed nurseries were introduced by the government in fiscal 2016 as a decisive measure to resolve the issue of children waiting to enter nursery schools.

Such nurseries are unlicensed facilities that do not need approval from relevant local governments. They are entitled to receive subsidies almost equivalent in amount to those provided for licensed nursery schools.

It is also possible to develop such facilities in a short period of time. In the past three years, the provision of subsidies was decided for 3,800 such facilities across the country, with their capacity exceeding 86,000 children.

It is highly significant that the capacity of accepting children has been expanded to provide flexible services suited to the ways company employees work.

On the other hand, acts of fraud linked to subsidies have occurred one after another due to the rapid increase in the number of childcare centers.

The former representative of a nursery operating company in Matsuyama city and others were indicted this month on fraud charges for allegedly overestimating construction costs in subsidy applications. The former head of a firm in Akita city has received a jail sentence for such misconduct as padding the number of children accepted at a nursery operated by his company.

Firm checks vital

The screening of applicants for state subsidies is conducted by a public interest incorporated foundation authorized by the Cabinet Office. About 50 people conducted screenings of applications last year. Screenings are said to have been based on documents submitted by the applicants. It is necessary to establish a system of checks to prevent fraud by reexamining problematic points in connection with the screening process.

Participation in the childcare business in a frivolous manner is conspicuous.

Operations at 252 childcare facilities, for which subsidies had been decided until fiscal 2017, have already been stopped due to the circumstances of subsidy applicants. There are nursery schools that were forced to stop operating because their teachers resigned en masse over such reasons as dissatisfaction with the policies of operators.

Noting that many nursery schools were operating well under capacity, the Board of Audit pointed out in April that “facilities were overly optimistic in estimating the number of children they would have, and that the guidance received after opening was insufficient.” The Cabinet Office is studying improvement measures, including direct state guidance for dishonest operators.

The budget allocated for the construction and management of employer-backed childcare facilities over three years until fiscal 2018 was ¥380 billion. As long as a huge amount of public money has been injected into such facilities, it is natural to call for steadfast management on their part.

To work toward improving the quality of such facilities, efforts must be made to increase the percentage of qualified nursery school teachers on staff and utilize the voices of parents in their management.

(From The Yomiuri Shimbun, July 27, 2019)Speech


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