5.6.2: Registrar-initiated ending of collection

Context

CSA can require parents to collect child support privately, despite the parents not having made an election for CSA to end collection of child support.

Legislative references

Section 38B Child Support (Registration and Collection) Act 1988

Regulation 5B Child Support (Registration and Collection) Regulations 1988

Explanation

From 1 July 1999, CSA can decide to stop collecting child support in a case where it is satisfied that the parents involved can make their own sustainable private collection arrangements.

CSA will only make a decision to require parents to make their own child support payment arrangements in cases where:

• The payer has a satisfactory payment record for the past 6 months; and
• CSA's satisfied that the payer will continue to pay their child support on time; and
• CSA is satisfied that private payment arrangements are appropriate for the parties involved.

Does a payer have a satisfactory payment record?

There are 3 prescribed criteria for deciding whether a payer has a satisfactory payment record (regulation 5B).

A payer can only have a satisfactory payment record if they have no arrears of child support and their liability has been registered with CSA for collection for at least the past 6 months.

The payer must also have either paid all their child support on time over the last 6 months, or there must be circumstances that satisfactorily explain the late payment.

All child support paid on time over the past 6 months.

Payers who have paid direct to CSA

A payer who makes payments directly to CSA will have paid their child support on time over the past 6 months if they paid their monthly liability in full over the past 6 months within 7 days of the due date.

Payers who have paid by employer withholding

CSA can collect child support by requiring the payer's employer to make deductions from the payer's wages or salary (i.e. employer withholding). CSA will be satisfied that a payer on employer withholding has paid their child support on time over the past 6 months if it received the full expected employer deduction in each of the past 6 months and the deductions covered the payer's full liability for each payment period.

Where the employer has deducted the scheduled amount from the payer's salary or wages, but remitted the deductions to CSA after the due date, CSA will still be satisfied that the payer has paid the amounts on time.

When an employer has not deducted sufficient to cover a payer's full liability in one or more payment periods in the past 6 months, the payer will still have a satisfactory payment record if they make the missing payments directly to CSA within 7 days of the due date.

Payers who have paid by non-agency payments (NAPs)

If part or all of a payer's child support liability for the past 6 months has been met by the credit of a non-agency payment (NAP), CSA will consider the date of that NAP and the period the payment was intended to cover. If the NAP was paid or transferred to the payee or to a third party within 7 days of the due date for the payment period in which the liability accrued the payer will have a satisfactory payment record.

Circumstances which satisfactorily explain late payment

A payer who has not paid all their child support on time over the past 6 months may still have a satisfactory payment record if there are circumstances that satisfactorily explain the late payment (regulation 5B(2)).

Retrospective variations to the liability

A payer may have had arrears of child support over the past 6 months which they have repaid by adhering to a satisfactory payment arrangement. If those arrears arose from a retrospective variation which was not due to the payer's action (or inaction), the payer can still be taken to have a satisfactory payment record.

Example

Where a retrospective variation was made because of the payer's inaction, they will not be taken to have a satisfactory payment record.

Example

Other circumstances which satisfactorily explain late payment

There may be other circumstances which satisfactorily explain late payments. A payer may have been physically unable to make their usual child support payment by the due date because of an illness or injury, or because they were personally providing care for their spouse or child during a serious illness. However, the payer should also have paid their entire child support liability as soon as it was possible to do so.

Is the payer likely to continue to make their payments on time?

A payer who has made timely payments of child support for at least 6 months will generally be considered likely to continue to make their payments on time. Where the payer had a poor payment history before the 6 month period, CSA will consider whether the payer is likely to voluntarily pay their child support to the payee without CSA's involvement.

The following is a list of issues that CSA will consider when deciding whether a payer will continue to make their payments on time. This list is not exhaustive.

• Reasons for late payment of any monthly child support payment.
• The payer's co-operativeness in repaying this debt.
• Whether CSA took any enforcement action in the past 12-18 months (including intercepting tax refunds).
• Where CSA has been collecting by employer withholding, whether there were arrears at the time that this commenced.
• Any statements by the payer that establish a clear intention not to pay if not compelled to do so.
• The reasons for the failure of any previous private arrangement within the past 12-18 months.
• If two or more private arrangements have failed in the last 3 to 5 years, the reasons for that failure.

Is private collection appropriate to the liability?

If the payer has a satisfactory payment record for the past 6 months and CSA is satisfied that the payer will continue to pay their child support on time, CSA must also be satisfied that private payment arrangements are appropriate in the circumstances of the case. CSA considers that it is appropriate for parents to make private payment arrangements if it is satisfied that those arrangements are sustainable. A private payment arrangement will not be appropriate if there are exceptional difficulties in the relationship between the parents, or between the parents and their children which could undermine the arrangement.

CSA will examine its file and computer system for the case for objective indicators of any exceptional difficulties in the relationship between the parents, or between the parents and their children.

Exceptional difficulties

Where one parent is reluctant to make private collection arrangements work, this will not generally be an exceptional difficulty. Exceptional difficulties could be a long term enduring nature (e.g. domestic violence) or of a more temporary nature (e.g. litigation). They may include, but are not limited to the following:

Family violence

Private collection is not appropriate in cases where there is a history of Family violence. (See chapter 6.10 Family violence). It may generally be inappropriate to require a person who has previously been exempted from having to take reasonable maintenance action by DSS or Centrelink to collect privately.

Illness

Private collection is not appropriate where a parent's physical or mental illness makes it unlikely that private arrangements would be sustainable.

Supervised contact

Private collection is not appropriate where the payer has 'supervised contact' with a child of the relationship.

Current or pending litigation

Litigation between the parents may indicate that private collection is not appropriate. It is irrelevant whether the litigation is about child support issues or an unrelated matter. Litigation can be a cause of stress or concern which may make moving to, or sustaining, private arrangements more difficult.

History of disputes

A history of disputes documented on CSA case (e.g. ongoing disputes about payments or care arrangements) may indicate that private collection would not be appropriate.

Version 1.0

Issued 1 October 2002

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