Exemptions from reasonable maintenance action

What are exemptions?

13.7 Exemptions are the key protective strategy for victims of family violence in both child support and family assistance contexts. They enable victims to opt out of the child support scheme where obtaining child support would compromise their safety. It is therefore important that exemptions are readily accessible to victims.

13.8 Victims of family violence may obtain an exemption from the requirement to take reasonable maintenance action. Exemptions are available to relieve a person from the requirement to apply for child support from the other parent, and to end an existing child support assessment (child support case).^[5] There are a number of grounds for exemptions. Grounds relevant for victims of family violence are: ‘violence or fear of violence’, and ‘harmful or disruptive effect’ on the payee or payer (including cases of rape or incest).^[6] Measures to improve the accessibility of exemptions are discussed below.

Exemptions and child support accessibility

13.9 While it is crucial that exemptions are accessible, agencies should not assume that all victims of family violence desire an exemption, nor that exemptions are the appropriate response to all family violence cases.^[7] This is particularly important as, when an exemption is granted, lack of child support payments may not be fully compensated by an increase in benefits—resulting in less overall income.^[8] Generally, family violence contributes to ongoing poverty for victims, and the lack of child support may compound this financial disadvantage.^[9]

13.10 Measures to increase the accessibility of exemptions should therefore complement, rather than undermine, reforms to improve accessibility of the child support scheme for family violence victims. A major theme of this section of the Report is to improve the issues management of child support to better protect the safety of family violence victims. This approach should facilitate victims’ participation in the child support scheme. It should also limit the uptake of exemptions on grounds of family violence to those cases where victims make an informed decision that exemptions are the best strategy to ensure their safety.

13.11 Existing policy in the Family Assistance Guide regarding the role of the social worker and Indigenous Service Officers (ISOs) complements this approach. The Family Assistance Guide provides that, where customers are reluctant or refuse to apply for child support, they should be referred to social workers or Indigenous Service Officers. Social workers and ISOs ensure that customers understand that:

• child support is for the financial benefit of the child and the parent caring for the child,
• child support improves the financial resources for children not living with both parents and can be received until the child turns 18 years,
• children are entitled to receive support from both parents, and
• child support does not have to involve contact between the parents. ^[10]

13.12 The Family Assistance Guide also notes that social workers may alleviate customers’ privacy fears, refer the customer for other assistance needed, and ‘present the advantages of the [child support scheme] for children in a more positive light’.^[11]

13.13 Such consultations with social workers and ISOs also provide a platform to give victims of family violence information about other measures available that may improve their safety within the child support scheme, including those recommended in this Report.^[12] This may assist victims to make informed choices in relation to their participation in the child support scheme.

Exemptions not in legislation

13.14 The requirement to take reasonable maintenance action is imposed by the Family Assistance Act. However, exemptions from this requirement are not set out in the Act. Exemption policy is instead contained in the Family Assistance Guide and, to a lesser extent, The Guide: CSA’s Online Guide to the Administration of the New Child Support Scheme (Child Support Guide).

13.15 The ALRC considers that exemptions from the reasonable maintenance action requirement are a significant matter of policy, and therefore should be included in the legislation itself, rather than only in the supporting policy guide. While the Department of Families, Housing, Community Services and Indigenous Affairs (FaHCSIA) did not support this approach,^[13] it was generally supported by stakeholders.^[14] For example, Welfare Rights Centre NSW commented that ‘a legislated exemption is preferred for reasons of clarity and certainty’.^[15]

13.16 Including exemptions in legislation acknowledges their significant role in protecting victims by permitting them to opt out from the assessment and collection of child support, without a consequent reduction of their FTB Part A payments. Further advantages are that legislative provisions are more authoritative and transparent, and may provide victims of family violence with increased procedural certainty.

13.17 In Family Violence and Commonwealth Laws,Discussion Paper 76 (2011) (Discussion Paper), the ALRC proposed that specified grounds for exemptions, including family violence, should also be included in the Family Assistance Act. In its final consideration, the ALRC considers that it is unnecessary for the Act to include the grounds for exemptions—particularly as this may introduce inflexibility in the administration of the Act. However, the Family Assistance Guide should expressly include family violence as grounds for an exemption from the reasonable maintenance action requirement, and this is discussed further below.

Accessibility of exemptions

13.18 The ALRC has considered a number of measures to improve the accessibility of exemptions for family violence victims, requests for which are determined by Centrelink.^[16] The CSA and Centrelink refer persons who may be eligible for exemptions to Centrelink social workers. ISOs may also grant exemptions.^[17] In some cases, family violence victims may contact Centrelink prior to contacting the CSA and receive an exemption at this stage, therefore having no contact with the CSA.

13.19 The evidence required to support an exemption from the reasonable maintenance action requirement, as provided for in the Family Assistance Guide, is of a relatively low threshold.^[18] Third party verification, where possible in letter form, may be provided by a variety of sources, such as: health professionals; community agencies; legal practitioners; police; relatives; or friends. Further, the Family Assistance Guide provides that social workers and ISOs should assist by fully exploring avenues for verification. It is also implied that exemptions may be available when verification is not possible.^[19]

13.20 While the evidentiary requirements to support an application for an exemption do not appear onerous, exemptions may be inaccessible to victims of family violence for other reasons. Family violence victims may be ‘uninformed or not aware’ of the availability of exemptions.^[20] Reviews of exemptions have also been identified as a factor that potentially deters victims from seeking exemptions.^[21]

13.21 The ALRC considers the reforms recommended in Chapter 4 should increase awareness about exemptions. In particular, agency identification of family violence-related safety concerns, and inter-agency information sharing about ‘safety concern flags’, should remove barriers to the accessibility of exemptions. These measures will increase the likelihood that those eligible for exemptions are identified and provided with targeted information. Other Chapter 4 recommendations that should improve the accessibility of exemptions are:

• provision of information by agencies to customers about how family violence is relevant to child support and family assistance—including information about exemptions;
• referral of all customers who disclose family violence to Centrelink social workers or other expert service providers; and
• training for agency customer service staff, Centrelink social workers and ISOs in relation to advising customers on the impact of family violence on their case.

13.22 The ALRC also considers that providing more publicly-accessible information about exemption reviews should go some way to addressing concerns that this procedure acts as a barrier to exemptions.^[22] Improving awareness about the nature and frequency of exemption reviews among customers and their advocates should improve the accessibility of exemptions.

13.23 A further measure that may improve the accessibility of exemptions is explicitly listing family violence as circumstances where a Centrelink social worker may grant an exemption. As mentioned above, the Family Assistance Guide provides that Centrelink social workers may grant exemptions on grounds of violence, or fear of violence. The ALRC considers that this ground should be supplemented, or replaced, by reference to family violence, including fear of family violence.

13.24 This measure may improve the accessibility of exemptions, as ‘family violence’ captures a broader range of conduct than ‘violence’—insofar as that conduct is violent, threatening, controlling, coercive or causes fear. This recommended reform is complemented by Recommendations 3–1, 3–2 and 14–1(a), which would set out a definition of family violence in family assistance legislation and the Family Assistance Guide. It is also complemented by Recommendations 14–1(b) and 4–6, which state that the Family Assistance Guide should include a description of, and staff should receive training about, the nature, features, and dynamics of family violence.

13.25 Another barrier to the accessibility of exemptions may be a lack of information about exemption-related procedures affecting victims of family violence. Information about the nature of exemption reviews in the Family Assistance Guide is limited, stating that the form of review depends on the circumstances, so that, for example, it may be conducted by telephone.^[23] The Child Support Guide states that reviews determine ‘whether the parents’ circumstances have changed and, if so, whether the exemption is still appropriate’.^[24]

13.26 The Family Assistance Guide also contains only limited information regarding the duration of exemptions granted on grounds of violence or fear of violence, and the frequency of reviews. The Family Assistance Guide 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. Further information is provided according to the type of exemption. Exemptions granted on grounds of violence or fear of violence are not specifically listed, and therefore fall under the category ‘other circumstances’, for which the time period provided is ‘as applicable’.^[25]

13.27 In the ALRC’s view, the Family Assistance Guide should provide more information about the review process, and the duration of exemptions granted on grounds of violence or fear of violence.^[26] This approach was generally supported by stakeholders.^[27] For example, the Australian Association of Social Workers Queensland (AASW (Qld)) and Welfare Rights Centre commented that ‘the clearer and simpler the process is and the extent to which this is then articulated to people will greatly benefit all concerned’.^[28] The ALRC considers that this approach ensures consistency and transparency in the administration of exemptions, and should improve the accessibility of exemptions for victims of violence.

Partial exemptions

13.28 Partial exemptions may be available to victims of family violence when they collect less than the full amount of child support. As discussed above, unless a payee collecting privately has been granted an exemption, he or she must collect the full amount of child support to fulfil the reasonable maintenance action requirement. If the payee does not collect the full amount, he or she may be required to change from private collection to CSA collection. If the payee does not comply, his or her FTB Part A is reduced to the base rate. The FAO assumes that the payee is collecting the full amount of child support, unless advised otherwise.^[29]

13.29 As stated in Chapter 12, victims may elect to collect privately, and collect less than the assessed amount, due to fear or coercion. Consequently, the application of the reasonable maintenance action test in these circumstances may particularly affect them. Where victims do not disclose that they are collecting less than the full assessed amount of child support, they may be otherwise disadvantaged by having their FTB calculated according to a higher child support income than they are actually receiving.

13.30 Partial exemptions should therefore be accessible to victims of family violence. However, a general lack of awareness about partial exemptions may affect their accessibility. In the Discussion Paper, the ALRC noted that stakeholders appeared unaware of partial exemptions. The ALRC stated that this was unsurprising, as partial exemptions were not explicitly or adequately provided for in the Family Assistance Guide.^[30]While partial exemptions are provided for in the Centrelink e-Reference, this is not a publicly-available resource.^[31]

13.31 The ALRC considers that the Family Assistance Guide should be amended to make clear the availability of partial exemptions. This proposal attracted support from the range of stakeholders who commented on this issue, including National Legal Aid, the Lone Fathers Association, and Women Everywhere Advocating Violence Elimination Inc (WEAVE).^[32] Additionally, FaHCSIA, in correspondence with the ALRC, considered that the Family Assistance Guide could be clearer in outlining that payees with an exemption may privately collect less than the full amount of assessed child support, and stated that it would update the text.^[33] On 20 September 2011, FaHCSIA amended the Family Assistance Guide to provide:

A partial exemption may be granted in cases where the individual has a fear of violence or there is risk of harmful or disruptive effects if they were to pursue the collection of the full entitlement or to transfer collection method to the CSA. The individual is not required to end the child support assessment; the partial exemption enables them to collect whatever they can privately without failing the maintenance action test. Individuals in this situation will be referred to a social worker for assessment who may grant the partial exemption.

This effectively means an individual with a partial exemption is able to collect less than 100% of their entitlement. In these circumstances, the individual’s rate of FTB Part A will be based on the amount of child support received, not the amount of the child support assessment.^[34]

13.32 The ALRC strongly supports the inclusion of this information in the Family Assistance Guide. It should increase awareness about, and therefore improve the accessibility of, partial exemptions. As a result of this amendment to the Family Assistance Guide, a recommendation to this effect is unnecessary.

13.33 In conjunction with this amendment to the Family Assistance Guide, the ALRC considers that customers should generally be informed of partial exemptions, and that this should be a component of the exemption-related information to be provided to customers in accordance with Recommendation 4–2. Targeted information about partial exemptions should also be provided by Centrelink social workers to payees who have disclosed family violence, particularly when they end CSA collection. This provision of information is facilitated by Recommendation 12–2, which provides that payees who elect to end an assessment or CSA collection should be referred to Centrelink social workers, and also Recommendation 4–3, which provides that all customers who disclose family violence should be referred to Centrelink social workers.

13.34 Proposed reforms regarding identifying family violence-related concerns should also assist the provision of targeted information about partial exemptions, insofar as they would facilitate referrals to Centrelink social workers. In particular, the ALRC recommends in Chapter 12 that the CSA should identify family violence-related concerns when payees request to end a child support assessment, or elect to end CSA collection of child support.^[35]