David Fawcett (Wakefield, Liberal Party) Share this | Hansard source

I rise to speak in support of the Child Support Legislation Amendment (Reform of the Child Support Scheme—Initial Measures) Bill 2006. As other members have rightly highlighted, this legislation has come out of the government’s response to the House of Representatives Standing Committee on Family and Community Affairs Every picture tells a story report, which captured in no uncertain terms the high degree of hurt and cost, both financial and emotional, that is wrought upon families, particularly children, in Australia when their parents decide to separate for whatever reason. It highlighted a number of areas of concern regarding the impact on families and, in particular, the effectiveness of the systems we have in place to assist those families and their children.

The government’s response was to set up a task force which was chaired by Professor Patrick Parkinson. A wide range of people were involved to try to make sure that all stakeholders in the process, both groups representing children and those representing the primary carers—often the mums, but also the dads—had their interests represented in coming up with a solution that is reasonable and practical for government to implement but that also has just and equitable outcomes to the greatest extent possible for each of the parties involved. I make that statement ‘to the greatest extent possible’ because no piece of legislation will be able to account for every individual circumstance. I recognise there will still be some people who will feel they have been treated unjustly by these changes, but I am satisfied that, on the basis of the task force set up by the government, these changes do represent a good and solid compromise from a range of positions to get the best possible outcome for the greatest number of people.

This is part of a package of reforms announced by the government in response to the task force’s findings, and they constitute a major overhaul of the scheme. Probably one of the most important aspects is the new child support formula, which for the first time tries to put some quantifiable data around the concept of how much it actually costs to raise a child, as opposed to the fairly arbitrary application of a system that really does not take into account many of the variables that individual relationships face.

The package recognises the fact that our demographics are changing and that there are more women in the workforce. There are also more men who have realised that the importance of work and family balance means that they need to perhaps reassess how much of themselves, their time and effort they choose to put into purely career and how much they choose to invest in their families. I will digress briefly and say that my hope is that the realisation that has occurred to many post separation will start to dawn on people prior to separation and that they will choose proactively to invest in their relationships so that there is that quality of relationship built, such that separations are certainly reduced if not eliminated altogether.

This reform is being implemented in three stages, and there will be a number of extensive and complex elements coming down the path. The reason for the phased introduction is that there is such a high degree of interaction between the new formula and the various software packages and other pieces of legislation that will impact on each of the stakeholder groups that, despite the fact that people have waited an awfully long time to see this change, we are far better served to take the time to get it right the first time to the greatest extent possible before implementation, rather than to rush it and end up confusing the situation and having failures in the system that will make the situation of many families, and of children in particular, even less fortunate than they are at the moment. Whilst I recognise and appreciate the concern and angst of some people who have spoken to me about the fact that there will be yet another delay before complete implementation, I do support the fact that we are taking this measured approach and putting in the resources to make sure that, when it is rolled out completely, to the greatest extent possible each of those interrelationships with other agencies will have been thought through so that we do not have unintended consequences and we do not have families, particularly children, who are disadvantaged financially through a rushing of the process.

However, in order to try to mitigate that delay, I think the government have wisely decided to bring forward whatever steps they can in the reform package to benefit families, and this bill addresses a number of those measures. I do not intend to address all of them but they include the increase in the minimum child support payment and the cap, which is one measure that I would like to speak about. Specifically I will also address the ‘capacity to earn’ decisions as well as the increase in the proportion of a child support liability that can go towards prescribed non-agency payments. Lastly, for the sandgropers, it is good to see an element dealing with the Western Australian legislation, which I must confess was news to me when I read it because I had not realised that situation stood with Western Australia.

I will now turn to the key areas that I would to discuss—that is, the cap, the capacity to earn and the percentage for non-agency payments. The schedule amends the figure that sets the cap on a liable parent’s adjusted income. Having spoken to a number of payers, predominantly men but I have also spoken to women in this situation, this change will be very welcome because it is in line with the underlying philosophy of evaluating the true costs of raising a child and for each biological parent to play a just and equitable role in supporting that child in accordance with those costs, as opposed to a system in which somebody who works hard, who shows innovation or who runs an effective business is almost penalised—which is certainly the way it is perceived—by increasing the take from those people.

I think one of the outcomes of that process has been to see a number of people disengage from the system. I have spoken to professionals who had tremendous things to offer the community, whether in the medical field or in other fields, who have walked away from that field of endeavour purely because of aspects like this ever-encroaching take by the Child Support Agency for maintenance payments. I believe that it is not only in line with the principle of looking at the true costs; I certainly hope that it will again increase that participation. As pointed out by members opposite, even with the reduction in the cap, by looking at the all employees average weekly total earnings we will still see payments under the new system that are substantially higher for children than those that currently exist. If we can particularly get that increased participation in the scheme, I believe we will see a far broader range of children who will benefit from that support from biological parents that has not existed previously.

The next area I would like to talk about is the one that is probably the most important and which looks at a new way of assessing a parent’s capacity to earn. These changes provide for a great more detail under the legislation to look at how that decision is made as to whether the parent has that greater earning capacity. The scheme at the moment has a number of flaws, and the outcomes are quite devastating for the people involved. The scheme at the moment means that if you have been working huge amounts of overtime, perhaps as a truck driver, as a shift worker or even as a professional to earn a given level of income, that is taken as the benchmark that you are capable of earning, with no consideration given to whether those hours that you were working were in fact reasonable or safe, and very little consideration given obviously to whether it was one of the primary reasons that the relationship actually broke down in the first place.

The lack of a clear statutory definition of capacity to earn has really worked against the payers in many situations. The new method is intended to be flexible enough to allow parents whose earning capacity has been assessed to pursue a different career path or to reduce their working hours. To my mind, that is just and equitable because it provides for them the same opportunities that people who are not in a payer situation have. There is nothing that says to somebody who is in an intact family or is single that they cannot change their job. There is nothing that says they cannot reduce their hours of work if that is a reasonable thing to do from their perspective. So I think some of the outcomes that we will see through this change will go to the heart of some of the great concerns about the current system.

I will look at safety. We have heard for a number of years concerns in the road transport industry about people driving incredibly long hours and we have put in a number of measures to try to reduce the hours that drivers drive. Likewise, workplace safety requires that we manage people’s fatigue. Even in the professions, such as the medical profession, we have seen a growing concern about people working excessive hours. So whilst these really positive steps have been taken in one area, we have this arm of government requiring people to work hours which are plainly unsafe. I think this change will have a terrific outcome in terms of recognising that just because they may have worked that at some point previously in their life there is no moral justification for requiring them to continue that work. In fact, the legislation looks specifically at setting additional guidelines so that the assessment is based on the level of normal full-time work for the occupation or industry in which the payer is involved. That is a terrifically important change. Also importantly, it addresses the issue of equity. As I touched on before, payers are now free to make the same choices that any other Australian can make. If they wish to go from full-time work to part-time work and training or, in fact, to full-time study to further their qualifications and opportunities, they are not prevented from doing that or sent into poverty through choosing to do that. This provides a very welcome relief valve for the purposes of people being able to change the work imbalance in their life.

There are some good safeguards in this bill in that the courts making that decision can see what the primary motivation is and there is ample opportunity to make sure that the parent can demonstrate that the change is not purely for the reason of reducing their maintenance payments and that there is a justifiable reason, which is now spelt out in some of the guidelines, for making the change. I think the most important outcome, though, will be in terms of relationships. So many relationships come under stress and break down because of the imbalance between work and family time. As people are working to try to build what are often material assets and are perhaps working in two jobs or are working excessive overtime to pay off the family home, the stresses that are put on the relationship are often a direct cause of the relationship’s breakdown. To then require those people to continue working those hours has two quite negative effects. It dramatically affects their availability to participate in a meaningful way in the ongoing lives of their children. For many of them that was difficult enough when they were working in partnership with the mother or father of the child but when they are living in a separated situation it becomes almost impossible for many people to have that meaningful input. So the ability to reduce working hours to something that is around the industry standard will play a large role in increasing the quality of ongoing contact. A number of studies highlight the very negative impacts of fatherlessness in our society. As the vast majority of non-resident parents are fathers, I believe this measure, which will allow fathers to adjust their work so that they can have more meaningful time with their children, will have longer term positive effects that we have yet to even start to factor into measures such as this.

Importantly, in terms of quality relationships, it will also enable subsequent relationships of people who have separated to have some chance of success. If somebody is moving on to a new relationship and is establishing and maintaining that relationship but is still being required to work the excessive hours that they worked previously while trying to maintain the difficult juggling act of involvement in their children’s lives, we are almost condemning them to failure. I think that is reflected in a significantly higher percentage of separations and divorce for subsequent marriages than for first marriages. So given this reason of reducing the damage to future relationships, I think the specific outcomes of this measure will be very beneficial to our community.

Proposed subsection 117(7B) looks at what a court needs to do to be satisfied that the parent’s earning capacity is greater than is reflected in his or her income. It talks about the safeguard that they should be able to come back, almost by default, to the industry standard full-time hours or working pattern without any question about their motivation. The other factor that I think is quite important concerns the amendment to subsection 125(5) of the act that talks about the decision that is made being just and equitable. As I come to proposed subsection 117(7B)(b), I see it talks about ‘caring responsibilities’. I wish to highlight the fact that I think this is an important clause because it comes to the outcomes of future relationships and the ability to make quality future relationships. But I believe there may be a need to actually provide even some more clarity as to ‘caring responsibilities’ and the definition of those. While it talks about those including responsibilities to people other than children in relation to whom support is paid, such as parents or a new partner, alternative caring arrangements can be perceived as being things that are for someone who is in need of care, such as disability care, child care or elder care. One of the positive outcomes is going to be in the area of being able to invest in relationships to keep those together and strong, which will benefit the children that may come from that relationship, while also allowing meaningful involvement with previous children. So I believe that there needs to be clarity in that area such that if somebody wishes to reduce their working hours so that they can invest in their relationship with a new partner that needs to be very clearly a reasonable motivation for that action.

The last point I wish to specifically address is the increase to 30 per cent of the child support liability that can be credited in relation to prescribed non-agency payments. I am hoping that that this will, again, play some part in reducing some of the frustration that payers feel when they have questions about where their maintenance payments are going. In conjunction with the parenting plans that people will now be encouraged to reach with their previous partner, the other parent of the children, I am hoping that we will see more benefit for the child because there will be an agreement by both parents as to the significant milestones and directions in the child’s life and there will be agreement about where some of that money should go and the opportunity for the payer to direct where some of that money should go as part of this new provision—in fact, it will be a larger amount, up from 25 per cent to 30 per cent. I am hoping that the combination of this measure and the parenting plans that people will be encouraged to work through at the family relationships centres will, again, see a less adversarial and more beneficial outcome for the children who are so sadly affected by separation.

In summary, I would like to highlight that I support the bill. I support the fact that it is being phased in so that we get the complex parts of it right the first time around. I support the cap and I particularly support the changes to how capacity to earn is decided. I note that the outcomes of that have the potential to have very long-term benefits for relationships and communities which, at the core, define our society and how functional our society is, so I greatly welcome that. Not only are things like the parenting plans going to help facilitate this but some of the other outcomes of things like the family relationships centres will be focused on relationship education which I hope will manifestly change the culture of relationships in our country, so that people invest in them so that many of the measures that we are talking about today will become less and less required as relationships are stronger and last longer.

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