The Australian Child Support Scheme – background and key features Cath Halbert, Group Manager, Payments Policy Group, the Australian Government Department of Social Services Presented at the HCCH conference on the Recovery of Child Support and Family Maintenance in Asia Pacific and Worldwide HCCH Asia Pacific Week 2015, Hong Kong, 10 November 2015

The Australian Child Support Scheme – background and key features 2 1. Size of the Scheme 2. Objectives of the Scheme 3. Objects of the legislation 4. The Scheme and its development 5. How the Scheme works 6. Features of the Scheme 7. Compliance activities 8. International arrangements 9. Australian international cases by country Overview:

Size of the Scheme The Australian Child Support Scheme – background and key features3 The scheme manages just under 800,000 cases on behalf of approximately 1.3 million parents and carers There are approximately 1.2 million children involved in the scheme Just over half the caseload (53%) payments are transferred privately between parents, with the remainder collected by the Department of Human Services Around $1.5 billion is collected and transferred via the Department of Human Services per year

Objectives of the Scheme Parents share in the cost of supporting their children according to their capacity Adequate support is available to all children not living with both parents Commonwealth involvement and expenditure is limited to the minimum necessary for ensuring children’s needs are met Work incentives for both parents to participate in the labour force are not impaired The overall arrangements are non-intrusive to personal privacy and are simple, flexible and efficient 1 The Australian Child Support Scheme – background and key features4 1. Cabinet Sub-Committee on Maintenance, Child Support: discussion paper on child maintenance (1986), p.14

Objects of the legislation To ensure children receive a proper level of child support from their parents after separation in accordance with the parents’ capacity to pay Financial support should be assessed without the need for court proceedings Children should share in the standard of living of both parents Payments are made regularly and on time Australia is in a position to give effect to its obligations under international arrangements The Australian Child Support Scheme – background and key features5

History of the Scheme and its development Introduced in 1988 in two stages –stage 1, from June 1988, involved the registration and collection of court orders –stage 2, from October 1989, provided for formula assessment The Australian Government Department of Social Services (DSS) has responsibility for child support policy and legislation The Australian Government Department of Human Services (DHS) has responsibility for service delivery –Up until1998 the scheme was delivered from the Australian Taxation Office. Major reforms occurred from 2006 to 2008, including a new child support formula The Australian Child Support Scheme – background and key features 6

How the Australian Scheme works Two pieces of legislation underpin the Scheme: – Child Support (Registration and Collection) Act 1988 – Child Support (Assessment) Act 1989 Assessments are based on the child support formula The formula takes into account: – the costs of children, – both parents’ income, and – the care each parent provides for their children Formula takes account of different costs of children at different income levels DHS can register, collect and enforce payments The Australian Child Support Scheme – background and key features7

Payees can be a parent of the child or a third party carer A payer or payee may pay or receive child support in more than one case, for different children The option to lodge estimates of future income within a financial year Relevant dependant allowance Fixed annual rate / minimum annual rate Change of assessment (COA) process Agreements Two options: private collect or child support (DHS) collect Non-agency payments (NAPs) The Australian Child Support Scheme – background and key features8 Features of the Australian Scheme

Compliance Activities Employer withholding Collecting through third parties Intercepting tax refunds Departure Prohibition Orders (DPOs) Deductions from social security payments Enforcing the lodgement of tax returns Income Minimisation Investigation Legal options Litigation Prosecution The Australian Child Support Scheme – background and key features9

International context Agreement between the Government of Australia and the Government of New Zealand on Child and Spousal Maintenance Agreement between the Government of Australia and the Government of the United States of America for the Enforcement of Maintenance (Support) Obligations Hague Convention on the Recognition and Enforcement of Decisions Relating to Maintenance Obligations 1973 United Nations Convention on the Recovery Abroad of Maintenance (UNCRAM) Non-treaty arrangements 97 reciprocating jurisdictions The Australian Child Support Scheme – background and key features10

The Australian Child Support Scheme – background and key features11 Australian international cases by country

For more information… Department of Social services (DSS) for policy: Child Support Policy Guide: Department of Human Services (DHS) for administration: The Australian Child Support Scheme – background and key features12

Thank you Cath Halbert Group Manager, Payments Policy Department of Social Services The Australian Child Support Scheme – background and key features13 Please send any questions to