Ann Corcoran (Isaacs, Australian Labor Party, Shadow Parliamentary Secretary for Immigration) Share this | Hansard source

The bill we have before us today, the Child Support Legislation Amendment (Reform of the Child Support Scheme—Initial Measures) Bill 2006, has taken quite a few years to get here, and the issues it addresses are very difficult ones. The beginnings of the bill are found in the community’s dismay and frustrations with how decisions are made about parenting and child support when a family breaks up.

In June 2003 the Prime Minister established an inquiry into child custody and child support. This was undertaken by the House of Representatives Standing Committee on Family and Community Affairs. In December 2003 this inquiry delivered its report, Every picture tells a story. In instigating this inquiry, the Prime Minister talked about three things in particular: he talked about the idea of rebuttable shared time with each parent, that equal time would be the default situation; he talked about the need for people other than parents, mainly grandparents, to be considered; and he talked about the need for the child support formula to be revamped.

It is impossible to bring in legislation that is going to meet the demands or expectations of everyone involved in family separations. By its very nature, the issue is emotional and every aspect is often overlaid with other issues or frustrations. Every member of parliament has experience in trying to help people immersed in the family law and/or the child support systems. We see the frustrations of men and women trying to work through the process. Many of us have personal experience of the system or of our family members dealing with family breakdowns. There is no easy answer, and there never will be.

It is interesting to note the language that is often used in this area and to think for a minute about how language influences attitudes. We talk about failed marriages, failed relationships, family breakdowns. This language presupposes that a marriage or a relationship ending is a bad or undesirable thing. I would like to float the idea that some marriages or relationships, which might be good for a time, come to a point where they should end. I would like to get to a point where a relationship can end without those involved being told or being made to feel that they have failed. I would love to see us accepting in a non-judgmental way that some people decide to end their relationships for their own reasons.

I am not in any way trying to suggest that we want a world full of relationships endlessly coming and going. We do need to find ways of helping those relationships that will continue to grow and be satisfying if a bit of help or support is available at a critical time. We also need to understand that some relationships do have a finite life. We should accept that only those in the relationship itself are the ones who know whether it should end.

When the Prime Minster established the inquiry into child custody and child support some three years ago, he talked about looking for a recommendation from the inquiry supporting the presumption of shared custody or equal time with each parent. This was mischievous, misleading and even cruel. We all have a number of constituents, usually men, who do not see their children as often as they would like and who see the system as being unfair and biased towards mothers. Many of these men were, understandably, delighted with the thought that once the inquiry was over legislation would be introduced and they would have, automatically, equal time with their kids.

I cannot dismiss the thought that this was a deliberate ploy by the Prime Minister to quieten down a group in the electorate and offer them false promises in the lead-up to an election year. The inquiry did not recommend that equal time be the standard or the starting point. It did recommend shared parenting, meaning sharing the responsibility for major decisions affecting a child. Unhappily, once again misunderstanding crept in. Many parents misunderstood the term ‘shared parenting’ and thought it meant equal time. Many parents are only now starting to understand what the term means.

What all this means is that a group of already unhappy parents who feel that the world, or at least the family law system, is against them have been tricked into thinking the system would dramatically change and are now feeling abandoned again. Some of this unhappiness was inevitable as some expectations are and were unreasonably high, but some of it has evolved from, at best, loose language and the leading statement from the Prime Minister, anticipating the result of the inquiry and getting it wrong.

The committee’s report Every picture tells a story, which was tabled in December 2003, made 29 recommendations that covered the family law process, the Child Support Scheme and parenting arrangements. In August 2004 the government announced the establishment of a ministerial task force and reference group to examine the Child Support Scheme, partly in response to the report. The report of the task force was released by the chair of the task force, Professor Patrick Parkinson, on 14 June 2005 and made a number of recommendations to overhaul the Child Support Scheme. In February 2006, the government released its response to the task force report and indicated the intention to adopt most of the recommendations for change of the ministerial task force. The government proposes that these changes will take place in three stages, the first from 1 July 2006, the second coming in in January 2007 and the third from July 2008.

The main changes that are being introduced are, firstly, the introduction of a new formula for determining a parent’s child support obligations. It will move to base the obligation on the actual cost of raising children, it will more equitably share the cost between parents based on their respective incomes and it will better balance the needs of first and second families. The bulk of these changes are planned to start from July 2008. The next change is increased enforcement and compliance powers for the Child Support Agency that should enable the agency to take more effective action against parents who fail to support their children. These changes are part of the bill being debated today and are to come into effect from July 2006. Another change will introduce the ability to have Child Support Agency decisions reviewed by the Social Security Appeals Tribunal. At the moment the review processes are by the CSA itself or the courts. These changes are planned to start in January 2007.

The purpose of the bill here today is to introduce the first set of changes. It will increase and index the minimum rate of child support payments. The minimum will move from $5 per week to $6 per week and will be indexed to keep pace with the CPI. The increase from $5 to $6 is to restore the value of the minimum payment to what it was when it was introduced in 1999. The bill will reduce the maximum income cap from about $139,000 to about $105,000 per year, which will reduce the amount of child support payable by high-income nonresident parents. This change is likely to be an interim step to tide the system over until the more substantial changes are made to how the support payments are calculated. If the legislation to come follows the Parkinson recommendations and the direction the government is suggesting it will follow, the maximum cap will become irrelevant. This is because the new formula is likely to be based on the cost of raising a child rather than the income of the paying parents.

The bill will alter the way the earning capacity of parents is assessed. At the moment parents are deemed to have a greater capacity to earn even if their income has dropped for good reason—for instance, because they need to work less in order to provide care for their children or because they have lost their job. The new arrangements will move closer to the recommendation that parents should be deemed to be earning more than they actually are only if it is likely or apparent that the motivation for reduced earnings is to reduce the level of child support payments. The bill will enable nonresident parents to offset 30 per cent of their payment against any credited amount spent directly on the children. This is an increase from 25 per cent. The bill has technical changes relating to arrangements in Western Australia.

The Parkinson report—that is, the report that responded to the financial recommendations of the Every picture tells a story report—made good and broadly sensible recommendations. It is good to see these recommendations starting to be acted upon. I look forward to the remainder of the changes being introduced, although I am intrigued about the delay in bringing them forward. As I understand it, the following changes are still to come. From January 2007 the government will introduce independent review of all CSA decisions by the Social Security Appeals Tribunal, broaden the powers of the courts to ensure child support obligations are met, strengthen the relationship between the courts and the CSA to make the process easier and more responsive to parents’ needs and give separating parents more time to work out their parenting arrangements before the family tax benefit is affected.

From July 2008 the government will introduce a new child support formula; change the way income from second jobs and overtime is treated, noting that often this income is sought to help with re-establishment costs after separation; change the treatment of parents with dependent stepchildren when calculating child support payments; simplify the change of assessment rules; and deal with a number of other matters. I note that the government has said it will do all these things and I hope that it does. If the matters due to be changed from January 2007 take place sensibly and effectively, this will take some of the frustration out of the system. Changes to the child support formula are needed too, but I am concerned about how this will be done as there are many low-income families who are dependent on child support and, if these changes happen, may be vulnerable to increased financial stress.

Mr Deputy Speaker, one of the most common issues raised with me in my electorate office, and no doubt with you in yours, relates to child support or custody. There is almost universal frustration with the way the Child Support Agency works. I hasten to make the point that, by definition, I do not see those parents who are happy with how their arrangements are working out. Like everyone else in this place, the constituents who approach me are usually the ones who are having difficulties.

Their complaints usually fall into one of two or three categories. One source of frustration is about the perceived rigidity in the way payments are assessed and the slow and complex process of varying the payments. Some payers feel that their ex-partner is misusing the money and some feel that they are being taken advantage of by their ex-partner. Another category is the parents in receipt of payments. Some of these parents are unhappy because they feel that their ex-partner is deliberately hiding their income to reduce the amount they pay in child support. Some are unhappy because their ex just is not paying at all. Both payers and payees will come to see me because they are unhappy with decisions that the CSA has made. To date these decisions are reviewed by another CSA officer, with the only other recourse being to the courts. This in itself is another source of frustration and leads some people to question the transparency of the system.

Not long ago a small business operator in Isaacs contacted me about the CSA. His issue is that the paperwork required by the CSA is becoming onerous. I spent some time with Tim in his factory and I can understand just what he means. Tim’s business is typical of many small businesses. The admin function is handled by one person. This person looks after the accounts receivable, accounts payable, purchasing and payroll and is usually the receptionist. Very often a large amount of the corporate memory rests in this person. This very busy person, often a woman, does not have the time to seek out and understand every nuance of the child support system.

Tim’s attitude is that he is happy to do the things he needs to do in deducting child support payments from his employees’ wages, but he is not prepared to spend hours completing forms, particularly when the information sought is already available. He has even indicated that he is getting to the point where he will be avoiding employing people who are clients of the CSA for this reason. I wrote to the minister with Tim’s concerns and the reply I received was less than encouraging. Essentially the minister advised Tim to do the CSA work online. This advice makes assumptions about internet skills and internet availability that do not always hold. The response is an indication that the minister is out of touch with how very small businesses operate.

It is clear to me and to my constituents that the child support system needs a drastic overhaul. I want to be clear that, whilst I am firmly convinced that the child support system needs an overhaul, this reflects the legislation that has existed to date; it is not a reflection in any way on the staff of CSA. My experience with CSA staff is that they work very hard to provide the best service they can within the constraints of the legislation and the resources made available to them. The CSA people we deal with through my office are always very efficient in responding to our questions and dealing with the matters we raise on behalf of our constituents.

I put on record the efforts the CSA has gone to in my area in conducting what we call child support forums. We have held three in the last 15 months in Isaacs, the most recent being last week. These forums are a collection of agencies who offer services to separating families. At last week’s forum we had people from the Child Support Agency, Family Court, Victorian Legal Aid, Council of Single Mothers and their Children, Dads in Distress, Mensline, Centrelink, Australia family support service, Lifeworks Australia and Relationships Australia. I put on record my thanks to all these agencies and their representatives for taking part in the forum. These representatives gave up their Thursday evening to present their material and to be available to people to have one-on-one discussions about their particular problems or to seek information. The Child Support Agency arranged one-on-one interviews throughout the day for those clients who asked for one and then spent the evening discussing child support issues in general with those who attended. Over the three forums we have managed to give information to something like 200 people. Most of the work in arranging these forums was done by officers from the CSA, each of the forums was well attended and the feedback from those attending was very positive. I encourage my colleagues to sponsor similar forums for their constituents, because they are well worth doing. I want to congratulate the CSA for taking the initiative in arranging these forums.

The Parkinson report, the report that responded to the financial recommendations of Every picture tells a story, made good and broadly sensible recommendations. It is good to see these recommendations starting to be acted upon. I look forward to the remainder of the changes being introduced, although I am, as I said before, a little intrigued about the delay in bringing them forward.

Before I finish I would like to make a point that is probably obvious but needs to be made, and that is that many couples who separate do so, if not amicably, at least in a cooperative manner and manage to sort out their child custody and child support issues themselves. Sometimes these arrangements come unstuck later, but very often they do not and there is no need to get involved with the CSA. Other couples, of course, do not separate in a friendly manner and need outside help to sort out their arrangements. These are the families that are affected by the legislation and the changes that are being discussed today. In summary, I support this bill and look forward to the rest of the changes being introduced.

See this speech in context