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Capacity to Earn - Stay at Home Mum

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SSAT Appeal by Ex as his child is 15y

I have an SSAT hearing coming up next month. This has come about by my Ex being held accountable for his full amount of child support.

Back in 2006 I moved out of area for my daughter's school, she lived 80% of her time with her dad, every 2nd weekend and 50% of all school holidays, with me; this enabled her to stay at her primary school.

When she was starting high school I proposed the same set up just the other way around; 80% of her time with me, and every 2nd weekend, and 50% of all school holidays with her dad. This was not going to get my Ex the right amount of time to qualify for a lesser child support payment.

He proposed he had her 2 additional nights per fortnight, I was just happy to have my daughter back, I agreed. This setup lasted about 1 month ! !  The distance from my Ex's to her new school and all the peek-hour traffic made it impossible.

I guess I should have changed the care arrangements officially with CSA but I just left it. My Ex begged me as he was in debit after buying his boat, and didn't want anything else on the books for when he applied for his housing loan.

With the new system that came in, in July - CSA sent out forms asking to update/fill in so they could be sure all was upto date.

I thought this was my chance to just be able to say 'Oh it happened in the new system, I didn't instigate this'.

During this process CSA spoke to myself and my Ex he said he didnt agree to the care percentages I was claiming. We were both asked to provide additional info. I had a friend draw up a letter and fax it in. CSA 'lost' the fax for about 2 weeks, and the decision was made without it. My Ex couldn't provide any supporting info denying my claim because I was telling the truth.

Any way the decision was made not in my favor, to just leave it as it was.

Eventually the fax showed up, but with the decision already being made I had to instigate an objection process.

This was upheld and he has been told to pay the corrected amount.

My Ex has now lodged with the SSAT, for as far as I can see sighting he didn't agree with the CSA formula, that all variables were not taken into account; ie my capacity to earn.

My Ex is the father of my 15 y old daughter I have 2 younger children 6y and almost 3y, to another man.

Can my capacity to earn be taken this way?

That because I choose to be a stay at home mum to my younger children his assessment should be only on his (the older) child.

If it was not for the younger children/child I would be required /able to work. My capacity to earn would be elevated.
I think this is the relevant section of the guide and my guess is that your capacity would be considered as low due to caring responsibilities.
The CSA Guide - 2.6.14: Resaon 8 - a parents income, property, financial resources, or earning capacity said
Parents caring responsibilities

(section 117(7B)(b)(i))

The type of caring responsibilities that might justify a parents decision to change his or her working hours will only be a personal responsibility to care for another person. Caring responsibilities include responsibilities to persons other than the parents own children, such as their own parent, a new partner or step-children, elderly relatives or friends.

CSA will take into account the following factors when considering whether the parents decision to change their working arrangements because of their caring responsibilities is justifiable.

- the relationship between the person being cared for and the parent providing care;

- whether the parent has a legal duty to maintain the person for whom he or she is providing care;

- if the parent has does not have a legal duty, whether they have a moral duty and the extent of that moral duty;

- the degree and type of care provided;

- whether the parent has some capacity for part time or casual work in conjunction with his or her caring responsibilities;

- the availability of alternate care (personal and institutional);

- whether that alternate care is suitable and/or affordable; and

- the previous and proposed duration of the period of care.

CSA will weigh up the evidence about these and any other relevant matters in order to decide whether it is satisfied that the parents caring responsibilities are such that they justify his or her decision to change his or her working arrangements.

The parent who is primarily responsible for care of the children for whom child support is payable may not be employed, or may be working part-time in order to accommodate his or her child care responsibilities. Where this is a longstanding arrangement (e.g. one that existed prior to separation, or since the children were born) the parent primarily responsible for care of the children may not have an additional earning capacity, because his or her ability and opportunity to undertake paid employment is diminished by their child care responsibilities and their absence from the workforce.

A parent who has been in the workforce may cease work, or reduce his or her work commitments to accommodate their responsibilities to care for a child. The child for whom the parent provides direct care could be the child from a former relationship (for whom child support is payable), or a child of a new relationship. In such cases, the parent (whether he or she is the payer or payee in the case) may still have an unexercised earning capacity that makes the assessment unfair. CSA may consider the following relevant facts over and above those considered in other earning capacity cases:

    * the age, health and number of children being cared for;
    * the practical availability of child-care;
    * the economic cost of child-care compared with income available to be earned;
    * the proposed period of the parents absence from the work force; and
    * whether the parent has appropriately balanced his or her obligation to support all of his or her children.

If the parents caring responsibilities do justify his or her decision about his or her working arrangements, then CSA must not make a decision to base the child support assessment on the parents earning capacity. However, if the parents caring responsibilities would not preclude work, or additional work, CSA must proceed to consider the third criterion below, namely, the parents purpose in making the decision about his or her working arrangements.
Thanks for the timely response Mike  

Do the SSAT take this; CSA Guide into consideration though, or do they make their own rules/findings?
Tira said
Do the SSAT take this; CSA Guide into consideration though, or do they make their own rules/findings?
To be honest Tira, having never been to SSAT, I don't know (my knowledge is very much based upon my work with the calculator, that is the one on this portal, which involved trying to decipher the legislation). However I would have thought that they should follow the legislation rather than the guide, as the guide is basically the CSA's own internal interpretation of the legislation, written by them and SSAT is meant to be an external review. However hopefully somebody who has experience of SSAT will say whichever.
In simple language, SSAT should follow the legislation and guide.

If they find the guide contradicts the legislation, the legislation has primacy.  And yes, I have some SSAT experience.
Hi MikeT

I may be very naive - I'm new to this, but doesn't the part of the Guide you quoted from infer that payee parents have an obligation to earn an income once their youngest child is of an age where child care is available?  Child care affordability & accessibility are high priorities for the Govt.  I still don't understand how some payee parents can cite "caring responsibilities" for school aged children.  Also, how can anyone, in this day and age, be deemed to have no capacity to earn an income?  I advertise for staff all the time, and we have trouble attracting appliants even though the $$ and conditions are very good.
Verity said
Hi MikeT

I may be very naive - I'm new to this, but doesn't the part of the Guide you quoted from infer that payee parents have an obligation to earn an income once their youngest child is of an age where child care is available? Child care affordability & accessibility are high priorities for the Govt. I still don't understand how some payee parents can cite "caring responsibilities" for school aged children. Also, how can anyone, in this day and age, be deemed to have no capacity to earn an income? I advertise for staff all the time, and we have trouble attracting appliants even though the $$ and conditions are very good.

When I answered and posted the guide, I was just looking at whether or not Tira could be hit with the capacity to earn, as soon as I saw a 2yr old then that made it very unlikely. However for capacity to earn to be applied there has to have been a change in the working arrangements. The Government, I believe can't enforce childcare. What can happen is that when there are no children under 7 (I might be wrong with the age), the Parenting Payment Single will be reduced/replaced with newstart (or something like that), unless the parent meets some criteria (this is all Centrelink stuff), which includes something like working or studying for something like 15 hours. This could result in a change that would satisfy the change of working arrangements criteria and for the earning capacity, however often it wouldn't as the change would often be from a long standing arrangement of caring for the child.

I think the legislation itself is clearer than the guide, although the guide does.
The Child Support Assessment Act 1889 - Section 117 (7B) said

(7B)   In having regard to the earning capacity of a parent of the child, the court may determine that the parents earning capacity is greater than is reflected in his or her income for the purposes of this Act only if the court is satisfied that:

a) one or more of the following applies:

(i) the parent does not work despite ample opportunity to do so;

(ii) the parent has reduced the number of hours per week of his or her employment or other work below the normal number of hours per week that constitutes full time work for the occupation or industry in which the parent is employed or otherwise engaged;

(iii) the parent has changed his or her occupation, industry or working pattern; and

b) the parents decision not to work, to reduce the number of hours, or to change his or her occupation, industry or working pattern, is not justified on the basis of:

(i) the parents caring responsibilities; or

(ii) the parents state of health; and

c) the parent has not demonstrated that it was not a major purpose of that decision to affect the administrative assessment of child support in relation to the child.
In my opinion it would be pretty hard to apply a capacity to earn, especially considering © (I think, if the old grey matter recalls, that this was changed in the new legislation as capacity to earn was considered by many to be very draconian). I recall one situation where a fighter pilot, grounded and given a desk job due to health issues, was deemed to have a capacity to earn as a fighter pilot and assessed accordingly. This I believe shouldn't happen with the new legislation.

I hope that makes some sense and it is clearer now.

I often find it necessary to look at the legislation to understand what the guide is saying, but that might just be a quirk of mine.

Last edit: by MikeT

I believe that capacity to earn may not be an issue until the youngest child is old enough to attend school.

Verity, your comments about the reality of whether a person can choose to earn an income are correct. I believe CSA would align itself to the same policy of centrelink that a mother can remain out of the workforce by choice, until the youngest child is old enough to attend school.

Junior Executive of SRL-Resources

Executive Member of SRL-Resources, the Family Law People on this site (Look for the Avatars). Be mindful what you post in public areas. 
Being a tad pedantic here, unless CSA has made a decision about capacity to pay I do not think SSAT can consider that aspect.

From the information you have supplied that does not appear to have happened.

You should talk to the CSA objections officer about this point, but do not tell the ex because it may result in another objection.
This is all hypothetical at this stage  -  but if the CSA determine a payee parent has no capacity to earn as they have caring responsibilities, and those caring responsiblilities are for a school aged child, this determination could be objected to?   My mother went straight from high school to being married, has never earned a cent in her life and worked harder than a lot of people I know.  She and my father agreed she would stay at home and work there.  She looked us and my father, and my father looked after my mother and us.

How about a payee or payer parent who has remarried or formed a permanent same-sex relationship, has another child and then gives up work - would there be a arguement for a financial relationship between the parent and their new partner that does not accurately reflect their financial resources?  I am not suggesting new partners should be responsible for existing children or that their income should be taken into account,  but if a spouse agrees to totally support their partner does it indicate a financial resource that CSA should consider?

Yes it could be objected to. I think virtually any decision the CSA makes in regard to assessment and collection can be objected to is some official way.

With regard to the second question, I don't think there would be a case as the caring responsibility could come into play, plus it would be easy to demonstrate that reduction of CS was not a major factor in the change of working arrangement.

As for the third question, I don't believe that it does, although there are many factors that could perhaps sway such a decision, but I don't think that on it's own it would be a reason. (Saying that I'm having a bit of a brain dead day and have had problems with digesting the question).
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