Child support laws

Background

12. The Child Support Scheme (CSS) was established in 1988 to enforce the right of children to be supported by both their parents.^[2] The legislative basis of the CSS is the Child Support (Registration and Collection) Act and the Child Support (Assessment) Act. The Child Support Agency (CSA) administers these Acts. The CSA is part of the Australian Government Department of Human Services.

13. The role of the CSA includes assessing amounts of child support payable, according to a legislative formula.^[3] The child support assessment takes into account the income of both parents, the care arrangements, the number of dependent children including those dependent children from other relationships. The CSA also collects and transfers child support payments, where requested by parents or carers.

14. The CSA’s policy resource is The Guide, referred to in this Issues Paper as the Child Support Guide. The Child Support Guide is described as a guide to the administration of the CSS,^[4] and it is accessible to the public online. CSA staff are expected to follow the Child Support Guide.^[5] Generally, policies and guides are not binding by law. However, they are a relevant consideration for decision makers, and may be taken into account in reviews of CSA decisions.^[6]

Matters outside the Inquiry

15. The scope of this Inquiry is limited by the Terms of Reference. The Terms of Reference provide a limited lens through which the ALRC can propose reforms—that is, to consider improvements to legal frameworks to protect the safety of victims of family violence. This Issues Paper considers reforms to child support legislation, policy and practice, which may improve the safety of victims of family violence.

16. Consequently, the ALRC does not propose to examine a range of issues which—while they may affect victims of family violence—have broader relevance to a range of Child Support Agency customers, and the operation of the Child Support Scheme. Reforms to address these issues would be systemic, and beyond the Terms of Reference. Alternatively, recommending narrower reforms that address the effect of these issues solely on victims of family violence would introduce a two-tiered operation to aspects of the CSS. The ALRC considers a two-tiered system—which would subject victims of family violence to substantially different practices and procedures than other CSA customers—to be inappropriate.

17. Systemic issues which are beyond the Terms of Reference are identified below.

Avoidance of child support obligations

18. Some payers may avoid their child support obligations by minimising the amount of child support they are required to pay under the child support assessment. Participants in one study identified a range of tactics used by payers to minimise child support assessments, including: listing income under a business name, not declaring entire incomes, and working cash-in-hand.^[7]

19. Payers may also avoid child support by paying child support late or irregularly, paying less child support than the assessment, or not paying at all. This may be an issue particularly where payees collect privately. Where the CSA collects child support, it has a range of coercive powers to effect payment, as discussed below.

20. Avoiding child support obligations may be linked with family violence. It has been identified as ‘part of an ongoing attempt to maintain power and control’,^[8] and an extension of other forms of family violence.^[9] It may also, in itself, constitute economic abuse.

21. Avoidance of child support by payers is an issue which affects a broad range of payees, including those who may not be victims of family violence. Systemic reforms to the CSS would be needed to address this issue and are beyond the Terms of Reference for this Inquiry.

22. The ALRC will however consider reforms to protect victims of family violence who, due to fear of or duress by the person who has used family violence, opt for private collection of child support—and are, therefore, more vulnerable to non-payment or underpayment of child support.

Percentage of care

23. The ‘percentage of care’ is the amount of time a parent or carer provides care for a child. This percentage is used in the child support formula, in order to take into account the costs of the child that are met by a parent or carer by caring for the child.^[10]

24. The Evaluation of the 2006 Family Law Reforms by the Australian Institute of Family Studies (AIFS) released in December 2009 considered whether child support is be relevant to positions adopted by parents in relation to care arrangements. Parents may wish to increase their care percentage to reduce their child support liability or conversely, resist a reduction in their care time to maintain their child support entitlements.^[11] This is an area of interaction between child support laws and family law, as parents may be motivated to seek parenting orders or agreements under the Family Law Act 1975 (Cth)that will affect the assessment of child support under the Child Support (Assessment) Act.

25. Manipulation of care arrangements to alter the child support assessment may affect victims of family violence, potentially motivating persons who use violence to seek a larger portion of care of their children to minimise their child support assessment. However, this issue is not limited to cases of family violence. Again, systemic reforms to the CSS would be needed to address this issue. Reforms to child support legislation to address the issue would be systemic in nature, affecting the child support formula.

26. Finally, the ALRC does not propose to deal with the issue of family violence and parenting orders under the Family Law Act. This issue has been previously considered in two 2009 reports and, to a more limited extent, in ALRC Report 114, Family Violence—A National Legal Response.^[12]

27. The ALRC will, however, consider the rules used by the CSA to determine the percentage of care, particularly when parents dispute the facts in relation to care provided.

Investigatory powers of CSA

28. The CSA is not required to conduct any inquiries or investigations in making administrative assessments.^[13] The Child Support (Assessment) Act provides that the CSA may—but is not required to—conduct inquiries and investigations in making determinations about changes to child support assessments (‘departure’ determinations).^[14]

29. The ALRC understands that the CSA does not, in practice, actively investigate cases. Consequently parents and carers may need to investigate the other parties’ financial circumstances themselves—for example, to support a change of assessment application. Where parents do not have the ability to do this, they may be financially disadvantaged.^[15]

30. This is an issue which may affect victims of family violence, who may be ill-placed to investigate the assets and income of persons who have used violence against them. However, the adequacy of CSA investigatory powers, and the degree to which CSA uses its existing powers, is a broader issue in relation to the CSS. While the ALRC will not be exploring this issue at large, the use of the CSA’s investigatory powers may be relevant to reform of other areas explored in this Inquiry.

Definitions

Definition of family violence

31. Family violence is not defined in either the Child Support (Assessment) Act, or the Child Support (Registration and Collection) Act. The Child Support Guide contains a broad definition of family violence:

Family violence covers a broad range of controlling behaviours. They are commonly of a physical, sexual, and/or psychological nature, and typically involve fear, harm, intimidation and emotional deprivation. It occurs within a variety of close interpersonal relationships, such as between spouses, partners, parents and children, siblings, and in other relationships where significant others are not part of the physical household but are part of the family and/or are fulfilling the function of family.^[16]

32. The Child Support Guide also provides definitions for the following non-exhaustive list of behaviours that may be involved in family violence:

• physical abuse;
• sexual abuse;
• emotional abuse;
• verbal abuse;
• social abuse;
• economic abuse; and
• spiritual abuse.^[17]

33. As noted in ALRC Report 114, provisions that affect the lives and safety of particularly vulnerable groups of society may be more appropriately placed in primary legislation.^[18] Therefore, it may be desirable for the definition of family violence to be provided in the Child Support (Assessment) Act and the Child Support (Registration and Collection) Act, rather than solely in the Child Support Guide. Placing the definition of family violence in child support legislation may give the definition increased stability, visibility and authority.

34. Legislative definitions of family violence were considered in ALRC Report 114. The ALRC and the New South Wales Law Reform Commission (NSWLRC) (the Commissions) recommended that state and territory family violence legislation, state and territory criminal legislation, and the Family Law Act should adopt a consistent core definition of family violence. The Commissions recommended the following core definition:

family violence is violent or threatening behaviour, or any other form of behaviour, that coerces or controls a family member or causes that family member to be fearful. Such behaviour may include but is not limited to:

(a) physical violence;

(b) sexual assault and other sexually abusive behaviour;

(c) economic abuse;

(d) emotional or psychological abuse;

(e) stalking;

(f) kidnapping or deprivation of liberty;

(g) damage to property, irrespective of whether the victim owns the property;

(h) causing injury or death to an animal irrespective of whether the victim owns the animal; and

(i) behaviour by the person using violence that causes a child to be exposed to the effects of behaviour referred to in (a)–(h) above.^[19]

35. It may be desirable to include this definition in child support legislation, as well as other relevant Commonwealth laws that are within the reference—including family assistance legislation, discussed below, and social security legislation. Consistent legislative definitions of family violence may foster a shared understanding across jurisdictions, courts and tribunals, and across agencies such as the CSA and Centrelink. Further, consistent definitions provide victims with clarity and the certainty that family violence will be recognised and treated similarly across Commonwealth laws.

36. The legislative definition could also be replicated in the Child Support Guide for enhanced accessibility. While the Child Support Guide currently contains a broad definition of family violence, it may be desirable for definitions of family violence to be consistent—not only across legislative frameworks, but also across legislation and policy.

Definition of eligible carer

37. The only reference to violence or abuse in child support legislation is contained in the definition of an ‘eligible carer’. The Child Support (Assessment) Act defines an eligible carer as a person who provides at least shared care of a child—that is, at least 35% of care. Non-parent carers who are ‘eligible carers’ and both parents of a child may apply for child support.^[20]

38. Where a person who is not a parent or legal guardian cares for a child without the parent or legal guardian’s consent, that person is not an eligible carer, unless it is unreasonable for a parent or legal guardian to care for the child. It is unreasonable for a parent or legal guardian to care for a child if the CSA is satisfied that there is:

• ‘extreme family breakdown’;^[21] or
• ‘a serious risk to the child’s physical or mental wellbeing from violence or sexual abuse in the home of the parent or legal guardian concerned’.^[22]

39. The ALRC is interested in comment from stakeholders about whether child support is accessible to non-parents who care for children at risk of family violence. The ALRC is also interested in whether, in cases of family violence, the threshold of ‘serious risk’ which applies to non-parent carers who care for children without consent of the parent or legal guardian, is appropriate.

Exemption from requirement to take reasonable maintenance action

Family Tax Benefit Part A

40. Family Tax Benefit Part A (FTB Part A) is the ‘primary payment designed to help with the cost of raising children’.^[23] It is paid to eligible parents and carers for each dependent child or, in some circumstances, each dependent full-time student. The amount of FTB Part A payable to a family is assessed according to the number of children, the age of children, and the family’s income.

41. Family assistance legislation requires a person who receives more than the base rate of FTB Part A for a child to take reasonable action to obtain maintenance, where it is reasonable to do so.^[24] This is known as taking ‘reasonable maintenance action’, or the ‘maintenance action test’. To comply with the requirement to take reasonable maintenance action, a person is generally required to apply for child support, where eligible, and to collect payments either privately or via the CSA.^[25] If a person does not take reasonable maintenance action, the FTB Part A payments for the child will be reduced to the base rate.^[26]

42. The requirement to take reasonable maintenance action may be problematic for victims of family violence, where the other party to the child support case is the person who has used family violence. An application for child support may increase the risk of violence against the victim. It may also lead to the person who has used violence subjecting the victim to pressure or duress in relation to child support matters, as discussed further below.

Family violence exemptions

43. Individuals may obtain exemptions from taking reasonable maintenance action on a number of grounds. The two grounds relevant for victims of family violence seeking exemptions are:

• ‘violence or fear of violence’;^[27] and
• ‘harmful or disruptive effect’ on the payee or payer (including cases of rape or incest).^[28]

44. Centrelink considers all requests for exemptions. The CSA refers persons who may be eligible for exemptions to Centrelink social workers. Indigenous Service Officers (ISOs) may also grant exemptions.^[29] In some cases, victims may contact Centrelink prior to contacting the CSA and receive an exemption at this stage—therefore having no contact with the CSA. This is discussed further below.

45. An individual may also obtain an exemption from taking reasonable maintenance action in order to end an existing child support assessment. Once an application for child support is made, and child support is assessed, the CSA cannot accept a person’s election to end the assessment unless an exemption is granted by Centrelink.^[30]

46. The Family Assistance Guide, which articulates policy in relation to family assistance, provides that Centrelink should generally review cases in which it has granted an exemption at least every 12 months, although the timeframe varies depending on the circumstances and the type of exemption.^[31] The review determines ‘whether the parent’s circumstances have changed and, if so, whether the exemption is still appropriate’.^[32]

47. The ALRC understands that, in practice, exemptions due to violence or fear of violence are initially granted for a 12-month period. Centrelink social workers review the exemptions at the conclusion of 12 months, and at this stage exemptions may be granted on a permanent basis. The practice of providing permanent exemptions after the 12-month review is not articulated in the Child Support Guide or the Family Assistance Guide.

Accessibility

48. Exemptions may be inaccessible to victims of family violence for a number of reasons. They may be ‘uninformed or not aware’^[33] of the availability of family violence exemptions. Victims may also be deterred by the complexity of the exemption procedure and the evidence required.^[34] Reviews of exemptions may also deter victims from obtaining an exemption.^[35]

49. Financial barriers may also deter victims from seeking exemptions. Where exemptions are granted, victims do not receive child support payments. The lack of child support payments may not be fully compensated by an increase in benefits. A victim of family violence who obtains an exemption may therefore receive less overall income than if he or she received child support payments.^[36] If this prospect deters victims from requesting exemptions, their safety may be compromised. Conversely, where they do obtain exemptions, decreased levels of income may compound the financial disadvantage already widely experienced by victims of family violence.^[37]

50. The ALRC is interested in comment as to whether victims of family violence face barriers in obtaining exemptions, what form these barriers take, and how they might be overcome. Implementing screening for family violence by the CSA—discussed below—is a reform which may go some way to addressing this issue. Another measure may be to advise all child support customers about family violence exemptions, perhaps in conjunction with family violence screening. The ALRC is also interested in whether reforms are required to address the financial disadvantage of victims of family violence who receive an exemption from the requirement to take reasonable maintenance action.

Consequences of family violence exemptions

51. The operation of the exemption policy as reflected in the Family Assistance Guide and the Child Support Guide has some problematic consequences.

52. Most notably, persons who have used family violence do not have to pay child support when the victim obtains an exemption. Persons who use family violence are therefore not required to take financial responsibility for their children in these circumstances. The ALRC is interested in reforms that address this consequence of the exemption policy, recognising that the safety of victims must be the priority.

53. An alternative model is provided by some US states, where child support debts accrue while exemptions are in place. Once the exemption expires, the person who has used violence is liable to pay the debt in full.^[38] This may prevent persons who use family violence from benefiting financially when victims obtain an exemption. However, the ALRC raises some concerns about this policy. Exemptions protect victims by addressing the risk of violence which may otherwise be triggered by a child support application or liability. Requiring a person who has used violence to pay a child support debt at a later stage—when the exemption is lifted—may still compromise the safety of victims.

54. A further issue is that victims who have obtained an exemption may in some circumstances be required to pay child support to the parent who has used violence. No barrier prevents a person who has used family violence from applying for child support in cases where the victim has obtained a family violence exemption. This may occur following a change to care arrangements—for example, where these arrangement change so that the person who has used violence provides more care. The ALRC is considering whether legislation should provide that where a person has been granted an exemption due to family violence, that person is also exempt from paying child support to the person who has used family violence.

Exemptions not provided for in legislation

55. Exemptions from the requirement to take reasonable maintenance action are not provided for in legislation. Rather, exemption policy is contained in the Family Assistance Guide and, to a lesser extent, the Child Support Guide. The ALRC is considering whether exemptions should be provided for in child support legislation, family assistance legislation, or both. Exemptions may be considered a significant matter of policy. Including exemptions in legislation would recognise their significant role in protecting victims by permitting them to opt out from the assessment and collection of child support, without a reduction of their FTB Part A payments.

56. Another advantage of setting out family violence exemptions in legislation is that such provisions would be more authoritative and transparent, and may provide victims of family violence with increased procedural certainty. The ALRC welcomes comment on whether exemption procedures should be contained in legislation, rather than in policy.

Seeking information about family violence

Child Support Agency

57. Family violence is relevant to the administration of child support, for example, in relation to collection of payments and protection of personal information. It is important that the CSA is aware of cases in which family violence is an issue, so that these cases may be appropriately dealt with. The ALRC is interested in comment as to whether victims of family violence are effectively identified by the CSA.

58. Victims may be reluctant to disclose information about family violence to agencies such as the CSA. In ALRC Report 114, the Commissions identified a range of reasons for non-disclosure of family violence:

A victim of family violence may hide the abuse due to feelings of shame, low self esteem or a sense that he or she, as the victim, is responsible for the violence. A victim may feel that he or she will not be believed. A victim may hope that the violence will stop, or might believe that violence is a normal part of relationships. Because of the family violence, a victim may feel powerless and unable to trust others, or fear further violence if caught disclosing it.^[39]

59. Further, victims may not disclose family violence as they may not be aware that this information is relevant to their child support case.

60. The CSA does not appear to screen routinely for family violence, for example when customers apply for child support. Applications for child support may be made to the CSA by telephone, electronically, on the CSA website, or in writing by lodging an Application for Child Support Assessment form.^[40] It is unclear whether CSA staff are required to ask persons about family violence when taking telephone applications, or at other stages in the administration of child support cases. The Application for Child Support Assessment form and the electronic form do not include questions about family violence or seek related information, for example about protection orders.

61. The ALRC is interested in whether the CSA should screen for family violence when processing applications or at other stages in the administration of child support cases. The ALRC is also considering whether questions about family violence should be included on the Application for Child Support Assessment form, and other CSA forms, including electronic forms.

Centrelink

62. Centrelink may be the first contact point for persons eligible for child support. Centrelink may refer persons eligible for child support to the CSA to apply for a child support assessment. Alternatively, Centrelink may grant the person an exemption from the requirement to apply for child support on family violence or other grounds. In these cases, it will not be necessary for the person to contact the CSA.

63. In order to resolve matters concerning safety of victims promptly and efficiently, eligible persons who wish to obtain family violence exemptions should be granted exemptions as soon as possible, rather than being referred between agencies. It is therefore important that Centrelink staff identify persons experiencing family violence before referring them to the CSA. However, Centrelink does not screen for family violence and relies on victims to self-disclose. Screening for family violence by Centrelink is considered in detail in the ALRC Issues Paper, Family Violence—Social Security Law.

64. In ALRC Report 114, the Commissions recommended the establishment of a national register which should include certain information about protection orders, family law orders and Family Law Act injunctions.^[41] The Commissions recommended that the national register

be available to federal, state and territory police, federal family courts, state and territory courts that hear matters related to family violence and child protection, and child protection agencies.^[42]

65. One option for reform is to provide Centrelink social workers with access to the national register, which would ensure they have access to relevant information about court proceedings and orders. However, extending access to the register to Centrelink social workers may raise privacy concerns.

Information sharing

66. In some cases, victims may disclose family violence to one government agency, but not another. They may assume that once one agency is informed about family violence, there is no need to inform the other. The Australian Government’s initiative to house Centrelink, Medicare and the CSA under one roof may have the unintended consequence of encouraging this perception.^[43] Further, requiring victims to repeat their experiences and fears of family violence to multiple agencies may have emotional consequences for victims.

67. Not all victims of family violence elect to obtain an exemption from the requirement to take reasonable maintenance action—indeed, many will choose to apply for child support for the financial reasons discussed above. The ALRC understands that where victims disclose family violence to Centrelink, but decline to obtain an exemption, Centrelink will not inform the CSA of the disclosure. This means that CSA may be unaware that persons referred to it by Centrelink have experienced, or fear, family violence.

68. As noted above, family violence is relevant to the administration of child support. Further, as discussed below and in the ALRC Issues Paper Family Violence—Social Security, family violence is relevant to the administration of family assistance and social security. To ensure that these cases are dealt with appropriately by both agencies, it may be desirable for Centrelink and CSA to share information about family violence.

Assessment of child support

Determination of percentage of care

69. The way in which the percentage of care is determined by the CSA may affect victims of family violence.

70. As discussed above, the percentage of care is used in the child support formula. This is the proportion of time a parent or carer provides care for a child. A person must provide at least 35% in order to be eligible for child support payments.^[44] Amendments to the Child Support (Assessment) Act have changed the rules for determining percentages of care from 1 July 2010.^[45]

Alignment of percentage of care

71. From 1 July 2010, the Family Assistance Office (FAO) and the CSA determine percentages of care in the same way. Determinations of percentages of care under family assistance legislation apply for child support purposes, and determinations under child support legislation apply for family assistance purposes.^[46]

Determining percentage of care

72. From 1 July 2010, the CSA will usually determine the percentage of care based on the actual care that is occurring.^[47] Actual care is generally based on the number of nights a person has cared for a child, or is likely to care for a child, over a 12-month period.^[48] If a determination based on nights is not appropriate, the CSA may base a determination on hours of care.^[49]

73. The CSA may request information from the parties in order to determine patterns of care. The Child Support Guide recognises that actual care may be reflected in care arrangements agreed upon by the parties.^[50] Since the July 2010 amendments, care arrangements are defined by the Child Support (Assessment) Act as written agreements, parenting plans and court orders—including parenting orders and state and territory protection orders.^[51]

When parties dispute the care that is occurring

74. Parties may disagree about the actual care that is occurring, and may provide conflicting information about how much care each is providing. The Child Support Guide indicates that the CSA encourages parents to resolve such disputes. If the parties cannot resolve the issue, the CSA will request additional information and evidence from the parties.^[52]

75. The Child Support Guide states that CSA will consider a ‘wide range of evidence’.^[53] This may include documentary records, such as diary entries, and records of visits to services, such as health care providers. The CSA may consider its records of customer contact, as well as Centrelink information. The CSA may also consider third party statements, if the third party is willing to be identified as the source of information, and the statement is provided to the other parent.^[54] The CSA has a policy not to obtain or consider information from children.^[55]

76. The Family Assistance Guide is more illustrative than the Child Support Guide in relation to types of evidence which may be taken into account in determining percentage of care.^[56] As the FAO and the CSA use the same rules to verify the actual care that is occurring,^[57] it is likely that the CSA has regard to the same or similar evidence. Examples of evidence which may be taken into account by the FAO are outlined below.

77. Based on this information, the CSA will determine a percentage of care. If the differences in the information cannot be reconciled, CSA will determine the care percentage on the balance of probabilities. If the CSA cannot reach a conclusion on the balance of probabilities, then the CSA will assume that the state of affairs at the time the assessment occurred will continue, and the care percentage will not change.^[58] It is unclear how the CSA makes a determination where there has not been a prior assessment.

Interim determinations

78. The Child Support (Assessment) Act provides for interim determinations about percentage of care in specified circumstances. In these cases, the percentage of care is not based on actual care. Interim determinations generally have effect for a period of 14 weeks, and may be extended to up to 26 weeks in special circumstances.^[59]

79. The CSA will not use actual care to determine the percentage of care where a care arrangement—as defined in the legislation—is not being complied with, and the person with reduced care is taking ‘reasonable action’ to ensure compliance with the care arrangement. In these circumstances the CSA may make an interim determination, in which the care percentage is based on the care the person should have had under the care arrangement.^[60]

80. The CSA may also make an interim determination where a care arrangement is not being complied with, and the person with reduced care is taking ‘reasonable action’ to make a new care arrangement, which provides the person with less care than in the current care arrangement, but more care than the actual care that he or she has. To make an interim determination in these circumstances, the CSA must also be satisfied that the person who is seeking a new care arrangement has ‘special circumstances’.^[61]

81. The Child Support Guide provides a non-exhaustive list of special circumstances. It includes situations where the parent could not continue to have previous levels of care due to, for example, serious medical problems.^[62] In these circumstances, the CSA may base the care percentage on the care the person would have under the new care arrangement.

Determining percentage of care prior to 1 July 2010

82. Prior to the amendments to the Child Support (Assessment) Act, the CSA generally made care percentage determinations in accordance with oral or written agreements, parenting plans or court orders related to care of a child.^[63] Where there was no agreement, plan or order in place, the CSA determined the care percentage on the actual care the parties were likely to have over the care period.^[64]

Interim determinations prior to 1 July 2010

83. Prior to July 2010, parties could apply to the CSA for an interim care percentage determination where care was not in accordance with an agreement, plan or order. In such cases, an interim determination could be based on the actual percentage of care that was occurring.^[65] The CSA generally reviews the interim determination within six months, unless there are special circumstances.^[66]

84. Section 52 of the Child Support (Assessment) Act previously provided that the CSA can make an interim determination where:

• in the circumstances of the case, a percentage of care based on the agreement, plan or order ‘would result in an unjust and inequitable level of financial support to be provided by a parent for the child’;^[67] and
• a parent or carer has taken ‘reasonable action’ to seek an agreement or a court order, or to enforce a court order related to the care of the child.^[68]

85. The Child Support Guide provides further information about where an ‘unjust or inequitable’ level of financial support exists, that is, where there is:

• a ‘significant difference’ between care provided for in the agreement, plan or order, and actual care; ^[69] and
• an ‘acceptable reason’ for non-compliance with the agreement, plan or order.^[70]

86. The Child Support Guide specifies a number of acceptable reasons for non-compliance with an agreement, plan or order, including that the CSA is satisfied that domestic violence or abuse could result if the agreement, plan or order was followed. CSA requires evidence from parties to support a claim of violence, including police reports, letters from medical practitioners, protection orders and applications for protection orders.^[71]

87. The Child Support Guide also acknowledges that customers may not be in a position to take action to seek an agreement or order, or enforce an order as a result of domestic violence or abuse, until ‘until they are in safe accommodation or have made arrangements to ensure the safety of their child or themselves’.^[72]

Effect of the amendments on victims of family violence

88. The ALRC is interested in the effect of the July 2010 amendments to the Child Support (Assessment) Act in relation to determining the percentage of care, including interim determinations, on victims of family violence.

89. The pre-July 2010 policy, as articulated in the Child Support Guide,did take account of the consequences of family violence for victims in the context of interim orders. However, it may be that the amendments effective from 1 July 2010 operate to the further benefit of victims, insofar as care percentages are now generally based on actual care.

90. The AIFS report considered the link between parenting orders and financial issues, including child support. This report predates the July 2010 amendments to the Child Support (Assessment) Act, and provides a useful insight into the effect of the pre-amendment rules. The AIFS report noted that ‘family law system professionals expressed concern about child support payments being based on court order arrangements that subsequently change’.^[73]

91. The report also noted that parents may be reluctant to seek new court orders to reflect changes in care due to barriers such as the costs of litigation, ‘burn out’, and personal circumstances.^[74] In particular, in family violence cases, lawyers considered it an appropriate strategy not to apply to change orders, in order to avoid re-inflaming the family situation. This noted reluctance to engage with the legal system was not limited to the courts, and also applied to Family Dispute Resolution processes. Parents therefore accepted the child support consequences of having assessments based on outdated care orders or agreements.^[75]

92. This problem would appear to be addressed by the post-amendment requirement that the CSA base the percentage of care on actual care, in usual circumstances, under the Child Support (Assessment) Act. The ALRC is interested in whether, in practice, this is the case. In particular, the ALRC is interested in whether the method of determining the care percentage introduced after 1 July 2010—including in interim determinations—is appropriate in cases of family violence.

93. The ALRC is also interested in whether CSA procedures in relation to determining actual care when parents disagree, as stated in the Child Support Guide, is appropriate in cases of family violence.

Departure from administrative assessment

94. A parent or carer may apply to the CSA for a change of assessment, also known as a ‘departure’ from the administrative assessment, due to ‘special circumstances’.^[76] The Child Support (Assessment) Act specifies a number of grounds for a departure from administrative assessment of child support by the CSA or a court.^[77]Family violence is not referred to in the grounds for departure.

95. The CSA or a court may make a departure from the assessment if satisfied that one or more of the grounds specified in the Act exist; it is ‘just and equitable’ for the child, the payer and the payee; and it is ‘otherwise proper’.^[78]

96. A person may lodge an objection to the initial CSA decisions with the CSA. If this is disallowed, a person may appeal to the Social Security Appeals Tribunal (SSAT). Prior to 2007, persons could appeal to a court with jurisdiction under the Family Law Act. In certain circumstances, a person may apply directly to a court with Family Law Act jurisdiction for a departure determination.

CSA initiated change of assessment

97. The CSA may also initiate a change of assessment due to ‘special circumstances’.^[79] There is only one ground on which the CSA may make a determination in these circumstances, namely where the assessment results in

an unjust and inequitable determination of the level of financial support to be provided by the liable parent for the child because of the income, earning capacity, property and financial resources of either parent.^[80]

98. The CSA must be satisfied that it is ‘just and equitable’ and ‘otherwise proper’ to make the determination.^[81]

99. The CSA is required to notify the parties in writing that it is considering making the determination, and must serve on the parties a summary of the information that it used to form the view that a determination should be made to change the assessment.^[82] It must also inform the parties that they may reply to the summary, and serve a copy of such a reply on the other party.^[83] The parties may jointly elect that the CSA discontinue proceedings, but only where the payee does not receive an income-tested benefit, pension, or allowance.^[84]

100. There is no requirement in the legislation or the Child Support Guide for the CSA to consult with either party prior to the written notification of both parties. This process may be commenced without the CSA consulting the payee, a practice that may compromise safety if the payee is a victim of family violence. It may re-ignite conflicts between parties or provoke violence, and the victim may be subject to threats or coercion in relation to the proceedings.

101. The ALRC is interested in stakeholder comment as to whether there should be a requirement in the legislation or the Child Support Guide for the CSA to ask payees if they have concerns about family violence before initiating change of assessment determinations.

102. The ALRC is also interested in comment regarding whether there are other circumstances in which the CSA should be required to ask customers about family violence before initiating procedures under child support legislation or policy.

Collection and enforcement of child support

Collection of child support payments

103. Payees may elect to collect child support payments privately from the payer, or for the CSA to collect and transfer payments. Child support legislation provides that the CSA must initially register a child support assessment for collection by the CSA, unless the payee elects that the CSA not collect child support.^[85] The Application for Child Support Assessment form presents applicants with the option to collect privately.

104. Private collection may suit families in which there are low levels of conflict. However, for victims of family violence, collection by the CSA may be more advantageous. The methods of collection used by CSA can minimise payers’ opportunities for non-compliance with child support obligations. The CSA uses a range of methods to collect payments, including deductions from:

• salary and wages;^[86]
• tax refunds;^[87]
• social security pensions or benefits;^[88]
• family tax benefits;^[89]
• payments under the Veterans’ Entitlements Act 1986 (Cth);^[90] and
• parental leave payments.^[91]

105. Importantly for the safety of victims, where the CSA collects child support, victims will not need to have direct contact about child support payments with persons who have used family violence. Participants in one study considered that they were able to ‘reduce contact and increase safety’ once the CSA collected child support.^[92]

Changing method of collection

106. Where the CSA is collecting child support, a payee (or payer and payee together) may elect to end collection by the CSA. Once the election is made, child support is payable directly to the payee. The CSA must accept the payee’s election to end collection by the CSA.^[93]

107. A payee who has previously elected to collect privately may apply for collection by the CSA. The CSA must accept the payee’s application.^[94] In these circumstances, the payee may also apply for the CSA to collect unpaid amounts of child support, called arrears. The CSA must grant the payee’s application to collect arrears that accumulated in the three month period before the CSA started enforcing child support payments.^[95]

108. Where the CSA is satisfied that there are ‘exceptional circumstances’, it may grant a payee’s application to collect arrears accumulated over a period of up to nine months.^[96] The Child Support Guide provides that exceptional circumstances include where a payer has ‘threatened or pressured the payee not to apply for registration for CSA collection’.^[97] The payee must provide evidence to show exceptional circumstances.^[98]

Private collection and family violence

109. Victims may elect to collect privately, or to end collection by the CSA, as a result of fear of, or coercion by, a person who has used violence. The ALRC understands that, due to fear and coercion, victims may also collect less child support than they are entitled to—or no child support at all.

110. Victims may not disclose to the CSA that they are not receiving child support in full or at all. It has been reported that victims may misinform the CSA about payments received in response to threats, due to fear of the consequences, or to avoid contact with persons who have used violence.^[99] Statistics of such cases may be ‘hidden’, as the CSA may consider such cases to be successful private collection cases,^[100] in the absence of any information to the contrary.

111. There may be further disincentives for a victim to advise that they are receiving less than the full amount of child support. Unless a payee has been granted an exemption, he or she must collect the full amount of child support to fulfil the ‘reasonable maintenance action’ requirement. If he or she does not collect the full amount, he or she may be required to change from private collection to collection by the CSA.^[101] If the payee does not comply, his or her FTB Part A is reduced to the base rate. The ALRC is interested in comment as to whether victims of family violence are affected by the requirement to take reasonable maintenance action in such circumstances.

Private collection required by the CSA

112. The Child Support (Registration and Collection) Act provides that the CSA may require parents to collect privately where the payer has a ‘satisfactory payment record’ which is ‘likely to continue’.^[102] The CSA must also be satisfied that a decision to end collection by the CSA is ‘appropriate in relation to the liability’.^[103] The Child Support Guide provides that it is not appropriate to require private collection where there has been a ‘history of family violence’,^[104] and where a person has ‘previously been exempted from having to take reasonable maintenance action’.^[105] It is unclear how victims of family violence are identified where they have not previously obtained an exemption.

Court enforcement of arrears and Departure Prohibition Orders

113. The CSA may take action to enforce child support arrears in a number of courts, including state and territory magistrates courts, the Family Court or the Federal Magistrates Court.^[106]Parents may also take court action to enforce child support.^[107]

114. The CSA can make a Departure Prohibition Order preventing a person with child support debt from leaving Australia.^[108] Such orders may be issued when a person owes child support, has not made arrangements for it to be paid, and has ‘persistently and without reasonable grounds’^[109] failed to make payments. A person may apply for a ‘Departure Authorisation Certificate’, which authorises a person to leave the country.^[110]

115. Victims of family violence may come under pressure from persons who have used family violence to elect that the CSA end enforcement of arrears, or revoke Departure Prohibition Orders. The Child Support (Registration and Collection) Act provides that payees may elect for the CSA not to collect unpaid amounts of child support when he or she elects to end collection by the CSA.^[111] The mechanism by which victims may elect that the CSA revoke a Departure Prohibition Order is unclear.

Child Support Agreements

116. The Child Support (Assessment) Act provides that parties can make an agreement regarding child support, and apply to the CSA to accept the agreement.^[112] Parenting plans, as well as maintenance and financial agreements under the Family Law Act,may be child support agreements, where they comply with the requirements of the Child Support (Assessment) Act.^[113]

117. The provisions that may be included in a child support agreements are specified in the Child Support (Assessment) Act, andinclude varying the rate at which a parent is liable to pay child support, and providing for non-periodic payment of child support.^[114] Non-periodic payments include lump sums, or non-cash payments such as school fees or rental payments.

118. Victims of family violence may be pressured into entering into child support agreements that are disadvantageous to them. However, child support agreements contain certain safeguards that may protect parties from exploitation. There are two types of child support agreement: binding child support agreements, and limited child support agreements. These agreements contain different safeguards.

119. A binding child support agreement must contain a statement from each party that he or she was provided with independent legal advice about the agreement’s effect on his or her rights, and its advantages and disadvantages.^[115] The agreement must also contain an annexure with a certificate signed by legal practitioner stating that the advice was provided.^[116]

120. In a limited child support agreement, a child support assessment must be in force at the time that parties make an application to the CSA to accept the agreement.^[117] The annual rate of child support under the agreement must be at least equal to the annual rate of child support under the assessment.^[118]

121. The ALRC is interested in whether these safeguards in binding and limited child support agreements are sufficient to protect victims of family violence from accepting disadvantageous agreements due to coercion by, or fear of, the person who has used family violence.

Disclosure of personal information

122. Child support legislation requires that the CSA disclose information about one party to the other party at certain stages of a child support case. Disclosure of personal information in accordance with these requirements may have an effect on victims of family violence.

123. The CSA is required to disclose personal information about a parent or carer to the other party when making a child support assessment. The CSA is required to give both parties written notice of the assessment, and must specify matters such as income, the number and age ranges of any dependent children, and the number and age ranges of any other children for whom a party pays or receives child support.^[119]

124. Other circumstances where personal information is disclosed include during a change of assessment procedure,^[120] where a party objects to a CSA decision,^[121] and where a party applies for a review at the SSAT.^[122]

125. It is clear from the Child Support Guide that—in at least some of these circumstances—the purpose of such disclosure is to facilitate principles of procedural fairness. The parent is provided with the information that is taken into account by the CSA in making a decision, and has the right to challenge the outcome if she or he thinks it unfair or incorrect.^[123]

126. However, providing one party’s personal information to the other party may have a detrimental effect on victims of family violence. Victims have reported resentment at ongoing disclosure of personal financial information.^[124] This may also affect the safety of victims, particularly when unaware that information provided to the CSA will be provided to person who has used violence.

127. The requirement for financial disclosure potentially may deter victims of family violence from lodging applications for child support, objections, or applications to change child support assessments. The ALRC is interested in reforms which may address this issue, while ensuring that principles of procedural fairness are adhered to.

Reporting family violence

128. Where a threat is made against a person to the CSA, child support legislation allows the CSA to disclose this where it is a ‘credible threat to the life, health or welfare of a person’.^[125] To disclose the threat, the CSA must also

• believe ‘on reasonable grounds that the communication is necessary to prevent or reduce the threat’;^[126] or

• have reason to suspect the threat is evidence that an offence may be, or has been, committed, and communicates the information for the purpose of ‘preventing, investigating or prosecuting’ the offence.^[127]

129. The Child Support Guide provides that where a threat is made to the CSA against a person, the matter should be referred to a senior officer who should consider whether to report the threat to police. The CSA will generally advise the threatened person, and ask him or her whether he or she wants the CSA to report the threat.^[128]

130. It is not, however, a legislative or policy requirement for the CSA to consult the threatened person before reporting the threat to the police,^[129] and the CSA will report a threat without consultation when it considers that there is an ‘immediate or urgent need to prevent an offence’.^[130] In addition, the CSA may report a threat to the police against the wishes of the threatened person if the threat is serious.^[131]

131. The ALRC is interested in finding how well this system works in practice to protect victims of family violence.

Protection of personal information

132. The Child Support Guide provides that where the CSA identifies a person as being at risk of family violence, and considers that increased security is warranted, the case will be referred to an authorised Restricted Access Customer System (RACS) coordinator.^[132] A RACS classification means that the person’s information is placed under higher security and there are a limited number of CSA officers who may access the information.^[133]

133. In considering whether to classify a person’s information as RACS, the CSA may consider the person’s requests, as well as ‘any special protection’ provided by other government agencies for the person’s information.^[134]

Other issues

134. There may be other relevant issues in the child support context which the ALRC has not identified in this Issues Paper. The ALRC is interested in comment on any other areas of child support law and practice that have an impact on the safety of victims of family violence.