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CSA Self Support Amount

Is the Self Support Allowance given by the CSA fair/correct?

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Why is it not linked to taxable income?

Hi All,

My first post, and I hope a prevocative one. It just occured to me that the Self Support Allowance (SSA) by the CSA is very unjust.

According to the calculator today, I (and her) are both entitled to the same SSA, which is $20,594.

My problem with this is that in the case of a person trying to recover from the financial burden of separation by working extra jobs, or bettering themselves through courses, hard work and promotion etc etc is effectively penalised; surely this number MUST also be linked to the taxable income. In other words, if you earn more by doing any of the above, why dont you have the right to have some self benefit for your efforts and have a higher SSA??

Remember, the cost of raising children is FIXED, so the person trying to earn more money (or who is already) simply ends up paying a greater proportion of that fixed cost.

I think this is a pretty fundamental oversight, one that I personally would lobby for change.
I agree, my big issue with the CSA in general is they do not follow the principals of the australian tax system. What if a person in the pursuit of wanting to earn more money spends $5,000 doing a course to improve qualifications, the ATO allows a deduction as a nessecary cost to generate income, however it is a cost none the less and a cost that eats up that self-support value, the same applies to train tickets, fuel, uniforms, etc.. Not all are deductible, however these additional costs are rarely duplicated for non-working ex's (the argument that non-working spouses have additional costs to raise children doesn't apply as child support payments cover these costs). It is these costs that reduce the free $$$ under the self support amount and to compound, if a deduction is claimed and a reason 8 COA is lodged, these deductions are rarely allowed to continue and as such the percentage payable increases. I agree that there should be a method to calculate the self support amount to take into consideration costs needed to generate an income…
Damo73, not that I agree with the amount of CS. The self support amount is a lot better than it's predecessor (pre 2008) which was in fact a great deal more biased. The recipient of CS's amount was over $40,000 whilst the liable parent's amount was under $20,000; if I recall correctly. I disagree that the cost of supporting a child does not change. However, you there are two forms of support. The first is the minimal amount of support needed to support any child or parent. The second is the amount to provide the support that one can afford on top of the basic support e.g. to provide the support of better schooling. The SSA is meant to ensure that a parent has at least that amount available, although where there is unfairness is that this is an amount based upon gross taxable income rather than net income, as such it should be a set amount. This is very often advantageous to a liable parent. The case being the frequent case where the liable parent is the only working parent.

Are you aware of the post separation additional income that can apply for the first three years after separation? If not then perhaps you should look to taking advantage of this. Here's a link to the relevant section of the CSA Guide. The CSA Guide - 2.5.2: Additional income earned post separation

Where formula based CS is unfair, in my opinion, is primarily two-fold. The cost of children is based upon research that basically looks at a large list of costs and I understand this even likely includes ridiculous amounts such as a theoretical cost of a parent not working and thus not earning. Basically the cost basis is that it cost over $500,000 to support an average child. That being when the average wage was under $50,000. It just doesn't add up to being feasible. A more recent researcher came up with a much more sound method. The researcher looked at the disposable incomes of families with and without children. The result was roughly 1/10th. It just so happens that I was a liable parent and am now a recipient and funnily enough the 1/10th was a good fit with my experience. The second area is that in reality CS is not only CS, 50% of it is a tax on liable parents. That is that for each dollar transferred or collected there is a corresponding reduction of 50c of the FTB paid out.

I also believe that the tiered rather than fully progressive care reduction is a scam and a failure. In some cases, between the 13% and 14% and the 34% and 35% boundaries, the rate for 1% or 1 nights change in the level of care can be over $10,000.

The first could be that a parent with 238 nights care (66% thus 34% for the other parent) pays nothing as they have over 65% care. If the same parent instead has 237 nights care (65% and 35%) then that parent can end up paying the parent with the lower care up to $10,968 (that equates to an equivalent rate of $4,003,320 for 365 nights).

The second is that a liable parent's CS could change, for just a single nights change (14% to 13%), where the amount can be up to $10,527 ($3,842,355 for 365 nights).

This is even more ridiculous because the new legislation was meant to reduce the stepped relationship between the level of care and the amount of CS paid. Rather it has introduced absolutely ridiculous steps.

As for your last statement in fact as you earn more you actually pay a lower percentage of CS corresponding with research that indicates that as incomes increase the amount spent on supporting children decreases as a percentage. It is similar to how tax works with income brackets but in reverse. Under the old system you paid a set rate. The new system is less unfair bit still unfair.

The most unfair aspect of all though is when the CSA are given the powers to act as a court registrar and thus make decisions. The ombudsman has recently (Aug 2010) issued a report detailing how the CSA is biased toward recipients (in fact the collection and or transfer of higher amounts) in the change of assessment process; termed by many as deem and destroy. Another area which I also think is absolutely disgusting is that the spring 2010 changes introduced legislation that supports recipients denying children their humane right to know and be cared for by their parents. This also results in a second form of child abuse, that of exploiting children for monetary gain. I believe that the CSA are even sinking to a new depth of disgust as I believe that workers, when making decisions in regards to interim care determinations are being told to not apply the legislation but to apply a rule that a determination can only be made if the parent with the reduced care has initiated court action. Not as section 52(1)(d) states that an interim care determination should be made if the parent has taken reasonable action to seek agreement, to seek court enforcement or to seek court action. I also believe that this legislation was introduced in an underhand way in that it was introduced without any explanation under the guise of other changes. My understanding is that the child abusive legislation was introduced simply to make the CSA's work easier and thus basically initiated by the CSA.
If the Government was fair dinkum about equality there would be set amounts for each child and both parents would contribute equally

IE 5 yrs old boy 150 / week

5 yrs old girl 153 / week

etc etc

If the lives with parent chose to sit on the couch or in chat rooms on the net etc and not do a thing about supporting themselves or providing a better outcome for there  kids then so be it.

 A system such as this would also stop a lot of denial of contact which increases non lives with's  liability currently

If there was no financial reward for denial of contact this site probably would not exist  as i believe many disgusting false allegations are made  to deny contact thereby increasing financial reward and there would certainly be no need for any CSA forums.

A system such as this would also certainly lead to second families having a fighting chance and would reduce the number of non lives with parents willing to cheat the system just to get an even break in life financially.

Imagine a system such as this and how it would affect our obesity statistics.

If I recall correctly another member  of this site suggested  this system a while ago

how does  a parent who earns 200,000 a year have a child who needs several thousand a month to survive yet a parent who earns less than the self support amount's child needs only 27 dollars a month to survive.

Clearly the system does not encourage non lives with parents to improve there financial situation other than by cheating the system by working for cash not doing there taxes or simply rorting centrelink etc.

That CSA encourages  lives with parents to seek more child support income and assists them by gifting without consent etc just shows the government is happy for a massive percentage of the population to sit back and enjoy the fruits of everyone elses labour in return for there vote at the next election.

I doubt many would object

just my thoughts

You can fool some of the people some of the time but you cant fool all of the people all of  the time unless they work for CSA and youre a Payee:)
What I believe should exist is a circular feedback system that includes a major lacking of the legislation. That is the legislation only enforces the responsibility upon a paying parent, whilst it ignores the responsibility that a child deserves that is to ensure that a parent responsibly spends and accounts for what is received. This actual cost, derived from the accountability data, could then feedback into child support amounts that reflect actual costs.

Thank you for a very insightful repy, much appreciated (and the link, was totally unaware of this). I should just clarify, when I said FIXED, i meant explicitly in the eyes of the CSA. As far as I can tell, the formula calculates "the cost of children" based on the research as you say. Therefore, my gripe is that because of this niave approach, this fixed cost is split between the parents according to income, in my case i pay 92%, she pays 8% of it. So this is where it all goes wrong, and granted linking SSA to income is only one way this could be addressed. If my income suddenly became the same as hers, then the %atges become 50/50, and to leyroy's point, how does the need of the child change? I get that (in theory) the extra income would have provided the kids with a better situation if non-separated (and beleive me, they dont want for much), but there is also the dad or mum, that should see some of that benefit (and here I thank you again for the link as I can see some attempt by the CSA in this situation).
Damo73, it's a little bit more complicated than that.

First the cost of the children itself is based upon the combined incomes. Each income is less the SSA and also less costs for two other specific types of children not of the case. The first and most prevalent are relevant dependant children(RDC's) (biological children of the parent's current relationship). These actually get the first grab at being costed (for want of better terminology) although their cost is based only upon the biological parent's income (so if that's less than SSA, e.g. the parent is on income support, then there is no reduction). The second is for children of other CS cases (Multi-case children) that the parent may have, this cost is also dependant upon that parent's income (with multi-case allowance there is also another value that is calculated called the multi-case cap that can cap the CS payable).

It is at this point that the cost of the CS children is then calculated based upon the combined incomes. It's all very much swings and roundabouts. Where the recipient is on income support then the other parent, if they have a taxable income over SSA, will always have a parent's income percentage (PIP) of 100%. However, there is no increase to the cost of the children that reflects the parent who is on income support, as there is no income over SSA.

I get the impression that you have little care (i.e. 13% or less) as the level of care comes into play after the two parent's income percentages are determined. At 0=13% care there is no reduction for care (I personally think this is very wrong and believe that there should be a progressive consideration for care). From 14-34% there is a 24% reduction (e.g. in your case your 92% would drop to 78% note that this percentage amount is actually to 2 decimal places, if I recall correctly). From 35-47% the reduction is 25% + 2% for every 1% over 35%. From 48-52% it's 50%. There are corresponding percentages for greater levels of care (basically the cost reductions always add to 100%).

After all that you then have to consider the real reason why so many developed countries have adopted child support schemes. This is as an additional taxation method, in all but name, to make separated parents reduce government social expenditure on supporting such children. Here the FTB paid is reduced by 50% for each $1. Perhaps consider another scenario a parent dies and the other parent is unable to work the Government or former employer doesn't stand in and pay CS to support such children they basically get nothing but have to be supported by income support and FTB only.

I don't think that there is any system that could be right. Saying that in theory the Australian system is fairer than many, perhaps less fair than some. Some systems if the US don't even take into consideration loss of employment/payment and then jail the liable parent when they cannot pay CS based upon what their income was. As I said previously I believe the legislation needs to fully legislate (or get out of the area) for parental financial responsibility (i.e. by enforcing the responsibility of how CS is spent). This would I believe act as the balance that is very much missing that allows CS to be misspent and for children to be abused by denial of contact for monetary gain amongst other wrongs that are basically condoned and supported by the current half-baked legislation.

P.S. We have two CS calculators available on this site. The advanced calculator even caters for scenarios that the CSA's estimator cannot handle (e.g. multi-case and non-parent carer) scenarios. It also provides more information and is also easier to use as it is based upon a single dynamic page where all the data is input and the results are displayed.
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