12 people have been arrested across Sydney in relation to a family daycare scheme allegedly defrauding the government of half a million dollars.

Police received information that a criminal syndicate, allegedly directed by a 46-year-old woman and a 29-year-old man, was operating a sophisticated scam and received up to $500,000 in government payments between March and October this year.

“It’s your money, it’s my money, and it’s being stolen!” Ray Hadley said.

Federal Minister Dan Tehan has defended the family daycare scheme but Ray Hadley said action must be taken.

“You can’t just simply say to people ‘you self-audit’ … because these people are just simply stealing from the Australian taxpayer!

“If there is a provision for people to lie, steal and thieve, you’ve got to close the loophole old mate!

“You can’t let it happen and stick your head in the sand!”

Click PLAY below to hear Ray’s comments in full