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Interest $$ from child support...who's is it?

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a class action needed?

Sometime back I came across a FaCS annual audit and within it I noticed some $695,000 was transferred from a trust account to the CSA. In addition monies from elsewhere (not a trust account) were allocated to the CSA for wages, rent, etc. I did a quick calculation and worked out this $695k would have been equivalent to a standard bank interest gained from yearly average of Child Support monies i.e @ 5% of $1.3 billion. (Interest rates were a lot higher)

My calculations may be incorrect, but back when I did this, the CSA held onto CS monies for around 4 weeks before paying the payee. So if one was paying $500 a month, around $6,000 per annum, at 5% interest, that's $300 a year or $5,000 over 15 years.  Now given the legislation stated the monies paid in CS were to be set aside for the child, then am I correct it deducing this interest was the child's, given it derived from their money?

If I am correct, then over the life of the Child Support scheme, our children have literally been ripped of millions, possibly billions of dollars. Or, from another point of view, payers have been ripped of billions of dollars, as it doesn't become the child's until received. Interest monies that could have been deducted from a payers payments. Either way, this interest earned is not the governments to do with as it pleases.

Argument maybe the government has a right to use these monies to recover costs in part or full. If this is the case, then wouldn't the child support scheme be considered a user pay system? Or that child support monies are taxed according to the interest derived from them? If the answer is yes to the former, can it be claimed as a legitimate expense? The latter, a tax for ATO assessment?

As to the user pay theory, the majority of payers do not choose to have CSA involvement and most certainly children don't fill out the forms, it is the payee whom makes the request. How is this taking of moneys from non applicants considered legitimate?

Since my initial discovery, time frames from payer to payee have shortened, however, CS monies are still held in an interest bearing account, which no doubt someone profits from.

I ponder whether a class action by payers, on behalf of the children and/or the payers/children whom have outgrown CSA involvement is possible.

I would appreciate thoughts from the forum.

Last edit: by zoehasrights


" Perspective depends on which side of the barbed wire fence you sit, or indeed if you are sitting on it! "
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