About the Child Support Payers Alliance
Since its commencement in 1989, there have been endless complaints about the administration of the statutory child support scheme. Our primary objective is to level the playing field so children benefit and no one has a legitimate right to complain.
Some payers complain they pay too much and some payees complain they don’t get enough or any at all. In many cases both parents are right to complain due primarily to the policies of the current child support scheme administrators.
The fact is that very few people really understand their equitable responsibilities. That includes most payers and payees. The bottom line is that this scheme was originally introduced to resolve the problem of the ever-increasing number of children affected by the separation of their parents and the subsequent increase to the number of court proceedings to deal with that. It was also intended to deal with increasing welfare payments and the accountability for child maintenance transfers between parents as an offset of those welfare payments.
Under the current statutory child support scheme, the legal responsibility to pay child support in Australia can only be imposed on taxpayers. How that imposition has legal force is quite complex and we won’t attempt to explain that here.
The scheme consists of two statutes [Child Support (Assessment) Act 1989 and Child Support (Registration & Collection) Act 1988] and provisions of other Acts that give effect to certain provisions of these child support Acts.
The Child Support (Registration & Collection) Act 1988 codifies a relatively fundamental process for recovery of a debt. It is in our view, impervious to any substantive legal challenge (other than one being technical in nature).
The Child Support (Assessment) Act 1989 is quite different. This Act effectively corrects a defect in the common law by creating a statutory chose in action in equity (an entitlement for one person to sue another) which the Commonwealth is entitled to do. It then circumvents any exercise of the right to sue under the cause and requires a parent to make an application for administrative assessment which the Commonwealth is also entitled to do.
The (Assessment) Act has two discrete objects:
Firstly and primarily, to ensure that children receive a “proper level” of financial support from their parents. This simple term has been clearly defined in Family Law judgements and we will attempt to explain further below what it means.
Secondly, that the level of financial support to be provided by parents for their children is determined according to their capacity (income and or earning capacity).
The Act then effectively circumvents the possibility of attaining its first and primary object. This point, along with current policy and policy implementation are what we see as the primary causes of the failure of this scheme to work effectively.
By the words, “receive a proper level of financial support from their parents” the Act means that each parent must be held responsible for their “equitable share” of their child(ren)s “necessary costs”. Establishing what each of these terms mean in respect to an individual case is a fact based exercise.
In this respect equitable share means that each parent has a separate responsibility for their share which can only be at most 50% of the necessary costs. What constitutes 50% of their share raises even more complex issues which we explain below in very simplistic terms.
Firstly, a parent’s failure to fulfill their own responsibility does not make the other parent more responsible.
Secondly, a parent’s equitable share is affected by the standard of living the child would enjoy if they lived with that parent.
Thirdly, the time a child spends with each parent is part of meeting their share of the child’s necessary costs. For example, if the child lives with one parent for 75% of the time and the other for 25% of the time the parent with lesser care owes the other parent the cost of 25% of the child’s necessary costs as they would be at the standard of living of the paying parent.
In this respect whilst shoes are necessary – Nike brand shoes are not necessary. At the same time, private education could be deemed to be a necessary cost if the child was enrolled in a private school prior to separation or if the child’s siblings have already, or are currently, attending private schools.
If the parent with majority care is unable to fulfil their obligation, it then falls incumbent on that parent to apply for welfare and other taxpayers foot the expenses.
In our view that is not how the scheme is currently administered and is why it is failing.
The current policy is one of over assessment. We believe this is to maximize claw-back of welfare costs generally.
For example: Social Security law now exempts a minimum threshold amount before child support payments are offset against welfare payments. We will assume that the minimum threshold is $20 per week.
Government then retain 50% of the excess or $0.50c from each additional $1.00 per week above that $20 to offset against welfare.
If we then assume there are 100 payers, that the amount assessed is $20 per week and every payer paid $20 per week.
From this Government would retain $0.00 each week.
If we then assume that amount assessed is increased to $30 per week government would retain $5 per week (50% of the additional $10 – above the $20 threshold) and also assume that 10 payers then stop paying.
From this Government would retain $5.00 each week from the 90 compliant payers which is $450.
If we then assume that amount assessed is increased to $100 per week government would retain $40 per week (50% of the additional $80 – above the $20 threshold) and we assume that 70 payers then stop paying.
Government would retain $40.00 each week from the 30 compliant payers which is $1,200.
Hence the policy of deliberately over-assessing maximises claw-back (profit) to social security. It also leads to avoidance of parental responsibility because you cannot negotiate your way out of the debt which keeps accruing with draconian penalties attached.
This is why so many children still live in poverty and carer parents struggle to make ends meet.
We aim to make the transfer of money equitable, in terms of the principles established by the Full Court of the Family Court so some carers receiving an excess will obviously receive less but many more will receive their proper share and children will benefit.
Disclaimer: Any information provided on this web site constitutes information only and is not intended in any way to be legal advice or to be acted upon as such.