Transcript Child-Halving in the Family Law system and the Links with

Child-Halving in
the Family Law
system and the
Links with
Welfare and
Child Support
Paper presented at International Women’s Conference 2007 USQ 2729 September
by Dr Elspeth McInnes AM
de Lissa Institute of Early Childhood and Family Studies
Research Group
University of SA
[email protected]
National Council of Single
Mothers and their Children
Formed in 1973 to fight for the basic rights of single mother
families at a time when mothers without husbands were
expected to relinquish their children to orphanages, foster
care and adoptions. http://www.ncsmc.org.au
NCSMC aims to:
• Ensure that all children have a fair start in life;
• Recognise single mother families as a viable and positive
family unit;
• Promote understanding of single mothers and their children
in the community that they may live free from prejudice;
• To work for improvements in the social, economic and legal
status of single mothers and their children.
Single Parent Statistics
• 2004-2006 486,000 one parent families
with children 0-15 (ABS 2007 Cat. 4102.0)
• 87% mother-headed.
• 39% no Year 12
• 62% in labour force
• 2003-4 Government main income 62%
with 51% getting some market income.
• June 2004 449,312 PPS claimants
(FACSIA Statistical Paper No. 3)
July 1 2006 Three Policy
Changes Target Single Parents
• Family law rules require decision-makers to
consider maximum time with each parent = 5050. (AGD)
• Child support changes begin reducing nonresident parents’ financial support for their
children in the residence household. (FACSIA)
• Welfare to Work policy reduces the age of the
youngest child to qualify for eligibility for PPS
from 16 to 8 yrs, reduces payment rates,
increases clawback against earnings and
introduces forced work activity. (DEWR)
Bad Outcomes for Mothers
and Children
• Family law changes result
in more children being
halved between parents
and reduced access to
safety for targets of abuse.
• Child support changes
mainly decrease financial
support for children of
separated parents in their
primary place of residence.
• Welfare to Work changes
cut income support for
single parent families and
introduce compulsory
activity testing and harsh
penalties.
Child-Halving Reduces Child
Support and Income Support
• Claimants of Parenting Payment Single or Newstart
Allowance with half-time care of a child may not be recognised
as Principal Carer for a dependent child. Only one parent’s
dependent care responsibilities are recognised and the other
parent is treated by the income support system as an individual
jobseeker.
• Family payments (Family Tax Benefit A and B) and child support
are affected by the child’s time in each household. Child support is
paid by the non-resident parent based on a formula assessed
according to the number of children, earnings and amount of care
provided. Family payments are reduced by 50c for every child
support dollar above $24.20 pw. Halving care of children reduces
child support transfers between parents.
• The combination of family law, welfare and child support changes
systematically discriminate against single mother families by
increasing their exposure to poverty and violence risks.
Political Context
• Conservative Coalition Federal Government elected in 1996
sympathetic to fathers’ rights movement arguments against
single mothers (eg. terrors of fatherlessness) and victim
stories of men done wrong by wicked women.
• Fathers’ rights groups secure federal funding - lobbying to
split children between separated parents, reduce child
support and make it harder for single parents to live on
income support – arguing that federal social security
system was funding mothers to leave marriages despite
single parent families being consistently identified as the
family type at highest risk of poverty.
• July 1 2006 Family law, income support and child support
changes reflect fathers’ rights policies.
House of Reps Inquiry into Family
Law and Child Support in 2003
• Every Picture Tells A Story Report released in December 2003
• Government Discussion Paper: A New Approach to the Family
Law System – released November 2004.
• Draft of Family Law Amendment (Shared Parental Responsibility)
Bill 2005 – released June 2005
• Legislation effective from 1 July 2006
• Government appointed a Child Support Ministerial with a
Reference Group made up of various stakeholders (those
representing payer interests outweighed those representing
payees)
• Child Support Ministerial Taskforce released its report In the Best
Interests of Children in April 2005
• Government adopted most recommendations of the report in
March 2006
• Child Support Legislation changes in 3 waves - July 2006,
January 2007 and July 2008.
Family Law Changes to Equal
Shared Parental Responsibility
• According to Philip Ruddock, Attorney-General, “the Shared
Parental Responsibility Bill … constitutes the most significant
reform of family law system in 30 years” (AGD, News Release 31
March 2006)
• New rules require a presumption of equal shared parental
responsibility unless a risk of harm from violence is legally
established but no implementation of Family Law Council (2002)
recommendations to address identified problems with child
protection and family law.
• NCSMC and other groups have concerns that these changes
– redefine the focus from the unique best interests of each child,
to an emphasis on parents’ rights (most especially, the nonresident parent)
– further undermine the safety of children and their family
members (most notably mothers)
– Nominate equal child-splitting as ideal forcing children of
separated parents into a ‘shuttle’ between parents’ households
– Another language change – ‘lives with’ and ‘spends time with’
replaces residence and contact.
Family Relationship Centres
instead of Courts
• Separating parents are required to attend family
dispute resolution to “negotiate” a parenting plan
– ‘future focused’
• Limited exceptions to compulsion:
– family violence but only where “reasonable grounds”
exist but no guidance in the legislation as to how these
grounds are to be determined
• Advisers have to raise the possibility of equal
parenting time
• Parenting plans take priority over court orders,
despite potential lack of legal advice
• KPI - number of agreements, rather than quality
of agreements (ie in the best interests of the
child)
Concerns for Safety and
Child Well-being in ADR
• Compulsory mediation could push parents into potentially
unsafe situations especially where there is a power
imbalance between parents
• The need to demonstrate “reasonable grounds” to fear
violence will increase reluctance to disclose
• Screening tools (no matter how effective) will not screen
out all cases of violence/abuse
• Emphasis on equal parenting time may influence advisers
and parents into agreeing to unsafe plans or plans which do
not reflect the child’s basic needs (eg. Breastfed babies
forced to wean to facilitate equal parental time).
• Concerns about insufficient funding, resources,
appropriately trained and skilled personnel to cope with
demand
• No independent external complaint processes
Family Court and Federal
Magistrates Court
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Division 12 A – A Less adversarial approach – national roll-out of children’s
cases program – unless Form 4 filed – notice of risk of abuse.
If Form 4, will invoke a Section 60CC consideration – 8 week period to
hearing. Section 69ZW allows court to order relevant state agency data
from health, child protection and police
The Court must apply a presumption that it is in the best interest of the
child for the child’s parents to have equal shared parental responsibility
unless there is violence or risk of violence
The Court must consider whether spending equal time (or substantial and
significant time) with each parent is in the best interest of the child, and
reasonably practicable, and then the court must make an order that the
child spend equal time (or substantial and significant time) with each
parent
Children’s views demoted to an “additional consideration” despite a key
finding of Every Picture Tells a Story Report that children did not have a
sufficient say in children’s matters before the court
Friendly parent provision means that the parent who appears to support
“equal time” will be viewed more favourably
Consultation over “major long-term” issues will increase abusive parent’s
ability to control other parent.
Best Interests of the ChildSection 60CC
• In determining this, there will be two primary criteria:
– meaningful relationship with both parents
– protection of the child from physical and psychological harm
• The AGD is aware these may conflict or cancel each other out.
Their response:
– “Where both considerations apply to a particular matter, the
government anticipates that the Court will then give
consideration to the additional factors … in order to determine
what is in the child’s best interest. For example, the
willingness and ability of a parent to facilitate a close
and continuing relationship between the child and the
other parent or any views that may be expressed by the
child” (HRSCLCA Report, 2005)
• The drafting of the legislation emphasizes the parents’ right to
“meaningful involvement” at the expense of child/ren’s right to
safety
Stage 1 Child Support
Changes
1.7.2006
– Minimum payment increased from $5 per payer parent to $6 and
indexed to CPI annually
– Non-resident parents claiming Newstart who have 14%+ of care gain
“with child rate” - extra $16.50 per week
– Income cap reduced for high income non-resident parents - from
$139,347 to $104,702
– Prescribed non-agency payments - increase in amount paid for specific
expenses determined by payer from 25% to 30%
– Improved child support collection - cases referred to ATO for nonlodgement of tax returns, increased investigations, court action, and
more intensive case management for difficult cases
– Improved administration of the Child Support Agency – Building a
Better CSA – smaller teams, call recording, personalised service
– Changes to assessment of capacity to earn – limits the circumstances
that can be considered. A non-resident parent will be able to reduce
their income (and their child support liability) unless it can be
demonstrated this is being done to avoid payment of child support.
Stage 2 Child Support
Changes 1 January 2007
– SSAT review of CSA decisions (previously after the
Objection Process could only appeal to the courts).
– Payees able to pursue court enforcement of the debt
while CSA continues ongoing collection (previously not
allowed).
– A court hearing an application for enforcement of child
support will have the same powers as the CSA to obtain
information in relation to either parent.
– Courts have increased powers to make temporary
arrangements about Child Support
– Maintenance Action Test extended from 28 days to 13
weeks.
Stage 3 Child Support
Changes 1 July 2008
New formula
• Reduces child support 0-12 and increases it 13-17; based on Ministerial
Taskforce’s calculations of the cost of children EXCLUDING the opportunity
and replacement costs of providing unpaid care for children
• Assessment capped at maximum 3 children, on the assumption that 4 or
more children are no more expensive than 3 (5 under the current system).
• Regular contact of 14-34% = a reduction of 24% of the payer’s
contribution of the calculated costs of children known as “credit for care”.
• No child support payable by minimum payers who see their child/ren 1
night pw.
• FTB not split under 35% care (currently 10%), but parents with 14-34%
care retain access to Rent Assistance, Health Care Card and Medicare
Safety Net
• Only child support children’s FTB will be reduced against child support
received under the Maintenance Income Test, rather than total household
FTB where there are other children.
• Payee’s income threshold before child support is reduced (ie the income
for the household where the child spends most of their time) will be
treated the same as the payer’s income (no acknowledgement of unpaid
care work) and fall from over $39,000pa to $16,883pa.
Stage 3 Cont.
• Payers who can not substantiate low incomes to pay $20
per child pw.
• Payers with liabilities to 2 or more families to pay the
minimum $6 per week to each family (currently split
between them)
• New treatment of second jobs and overtime to help with reestablishment.
– For the first three years after separation parents will be able to have
income from second jobs and overtime excluded from child support
calculations, when the extra money that they are earning is used to
help with re-establishment costs.
• Both parties have re-establishment costs, but the parent with
majority care of young children will have a relatively reduced
availability to undertake extra earning activity.
• Treatment of second families – no longer a flat rate – all
biological/adoptive children to be part of the new formula
How the new formula works
• Step 1 – Determine income of both parents,
deduct self support amount for each and add
together = combined child support income
• Step 2 – Using the combined child support
income, calculate the costs of children by
referring to the table provided by the Ministerial
Taskforce (pp. 37-38) = calculated costs of
children
• Step 3 – Apportion this cost between the parents
(based on their capacity to pay)
• Step 4 – apply reductions for regular or shared
care to payer’s portion of costs
Low Income Case Study
Robyn and Nicholas have two children under 12:Robyn’s earns
$26,883 Nicholas earns $36,883
After subtracting self support the child support combined income
is $30,000 (Robyn 33.3%; Nicholas 66.7%)
If Robyn has 100% care, under the new system, Nicholas’ child
support is reduced from $6,183 to $4,769 pa
Robyn would receive increased FTB of $708 pa leaving her
household where the children live is $706 pa ($13.60 pw)
worse off. Nicholas saves $1,414 per annum ($27 pw).
If Nicholas has contact of between 14-34%, he receives a 24%
reduction on his proportion of the calculated costs of the
children: Based on their respective earnings, Nicholas is
responsible for 66.7% and Robyn’s is 33.3% of these costs.
Applying the 24% reduction reduces his liability to 42.7% which
is $3,052 pa, resulting in the household income where the
children primarily reside being reduced by $1,569 pa ($30.17
pw). He saves $3,131 pa ($60.21 pw)
Another Case Study
From the Ministerial Taskforce Report (p. 252):
Meng and Tom have three children under 12 and
Tom has 25% care:
Meng’s income is $27,000
Tom’s income is $51,500
Under the current system Tom would pay Meng
$11,793 per annum
Under the new system Tom will pay Meng $6,344,
down $5,449 pa
However, Meng’s FTB will increase from $5,417 to
$11,308 as it will no longer be split with Tom
Overall, Meng will be $442 pa better off but Tom
will save $1,887 pa.
Income Support and
‘Welfare to Work’
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Pre July 1 2006, single parents could receive PPS until their youngest
child was 16. Those on PPS before 1/7/06 (grandfathered group) can
remain on PPS unless they go off payment for 12 weeks.
Welfare to Work rules require Principal Carer parents of six year old
children to participate in an employment service, enter into an
“activity agreement” while seeking 15-25 hours paid work per
week with a minimum of six job applications pf. Undertaking the
activities in this agreement will satisfy the “activity test” and avoid a
“Participation Failure”.
Parents are also required to complete a yearly “Mutual Obligation”
activity, of 150 hours over 6 months. Activities may include paid
work, study, training or voluntary work. The “default” activity is Work
for the Dole.
Those working at least 15 hours per week will satisfy the activity test
and meet the additional “Mutual Obligation” activity.
Parents are moved to the lower Newstart Allowance when the
youngest child is 8 years old.
‘Work first’ rules reduce access to and financial support for tertiary
study.
Poverty+ Complexity +
Inequity =<HARDSHIP
• PPS Child $537.70* pf
• Income Test applies on
earnings above $156 pf plus
$24.60 for each additional
dep. child
• Taper rate on earned income
= 40c in the dollar
• Cut-out Point for PPS with
One child = $1,515.35pf
• PPS with 2 children and 30
hrs work pf @ $15 receives
$450 wages + $430 PPS =
$880pf
• NSA single with child $464.90
pf ($72.80 pf worse off)
• Income Test applies on
earnings above $62 pf – no
variation with additional dep.
children
• Taper rate on earned income
$62-$250pf = 50c $250+ =
60c
• Cut-out point for NSA
$868.17pf ($647pf less than
PPS)
• NSA with 2 children and 30
hrs work pf @$15 receives
$450 wages + $275.90 NSA
= $725.90
8 week ‘no payment’
penalties
• 8 week loss of payment for 3
Participation Failures in 12
months or
• Refusing a suitable job offer
(defined as meeting the
Australian Fair Pay
Commission minimum rules)
• Being dismissed for
misconduct
• Voluntarily leaving a suitable
job
• Parents who lose payment are
eligible for ‘case
management’ of funds by
Centrelink or contracted NGO.
Principal Carer Activity Test
Exemptions
12 month renewable exemptions
• Home schooling and distance education parents
• Foster Carers
• Parents of four children aged between 6-15
Temporary 13-16 week exemptions – domestic
violence in the past 26 weeks, illness or family
crisis – per case on application.
Parents with children with chronic illness or
disabilities are reporting problems with lack of
system recognition of the impact of high care
demands as system is geared to individuals.
Compounding Harms
• Family law child distribution rules increase risks to
children’s well-being and reduces safety, as well as
reducing child support and family payments.
• Child support formula and rule changes deliver biggest
gains to wealthy non-resident parents and provide
incentives for non-resident parents to seek increased
contact in order to reduce child support payable.
• Income support changes subject parents to forced work in
low wage insecure jobs for an extra $5 per day earnings
and shared care children may result in no access to PPS or
Principal Carer Protections.
• Advocacy needed to 1. reduce poverty 2. improve
protection from violence/abuse and 3. restore women’s
right and capacity to live in households and relationships of
their choosing with their children.