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Reason 8 COA

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Why must all 3 criteria be met to achiv achieve a rebuttal?

There are 3 criteria to achieve a rebuttal in Reason 8 - Earning capacity - for a COA…

 1. The parent is either:

  AND

2. The parent's decision about his or her work arrangements is not justified by either:

  AND

3. The parent has failed to show that the decision about his or her work arrangements was not substantially motivated by the effect this would have on the child support assessment (section 117(7B).


Why do all three have to be met to achieve a rebuttal?
Purportedly to allow people with just reason to not be caught in the trap. It's a little fairer than the fundamentally flawed predecessor.

I'm not sure that you understand. The rebuttal is really the other way round. That is the criteria have to be met for a capacity to earn to apply; therefore the default is that there is no capacity to earn.

# Criteria Reason 8

MikeT said
Purportedly to allow people with just reason to not be caught in the trap. It's a little fairer than the fundamentally flawed predecessor.

I'm not sure that you understand. The rebuttal is really the other way round. That is the criteria have to be met for a capacity to earn to apply; therefore the default is that there is no capacity to earn.


 

I get the rebuttal.. just stated clumsily…

The test is framed as a 'rebuttable presumption'. The starting point is that affecting the child support assessment is presumed to be a major purpose of the parent's decision about his or her working arrangements. The parent can rebut this presumption by demonstrating, to CSA's satisfaction, that affecting the child support assessment was not a major purpose of his or her decision.

What is "the trap"….

Thanks for your engagement with the discussion, I went through a COA and found it very disappointing, imcompetent even… but I'd like to prove to myself that I am wrong… or justified….

Can you outline what "the trap" is… please…  ill explain more if you are interested
A capacity to earn decision, is I believe the only situation where a citizen has to pay, what are effectively taxes, based not upon what a person has but on what a person could have under different circumstances. Imagine if income tax were based upon a capacity to earn if some "cronie" basically just thought that you should. Imagine if income support payments were only given if there were a provable incapacity to earn.

Capacity to earn was one, if not the most used(abused) aspects of the previous fundamentally flawed legislation. One example that I am aware of was a fighter pilot, due to the other parent leaving, making accusations etc, the fighter pilot suffered health issues and was grounded and given a much lower paid desk job. However the CSA deemed and very much destroyed the pilot by making a decision that the pilot had a capacity to earn as a fighter pilot. Under the new legislation, in theory, that fighter pilot's health issues would have been considered. I say in theory, as the CSA have a track record, supported by an Ombudsman's report, of applying(distorting) the legislation in order to artificially increase their standing. Their standing is the amount that is collected or transferred which actually then equates to an amount of FTB payments that can be clawed back (i.e. in all but name a tax).

In fact in the case of the fighter pilot. If the CSA had not have applied the capacity to earn then our massive investment in that fighter pilot (I think but I'm not sure that we are talking about the CSA basically wasting millions of tax payers money for the sake of hundreds or thousands of dollars).

However the last condition is still a trap. Basically it is very hard to prove(show) a non-event. Basically like much of the not quite so flawed legislation, much is very often left up to people who if they were any good in the area of legislation would very likely be following an occupation where the rewards are far greater. I believe that tax legislation is far more complex and convoluted, yet the ATO have created forms that allow the legislation to be very easily followed with very basic questions. I believe that the same could apply to the far less complex CS issue including the change of assessment process. You could take out people making decisions, you could simply have people administering a system. Considering the Ombudsman's report and decisions that I have seen, such a system should have been introduced yesterday at the latest.

Further evidence is that SSAT, when that route is taken, the rate of CSA decisions being needed to be changed is well over 50%. After SSAT it is court, which very few would consider due to the expectations of it costing so much amongst other reasons. When the hurdle of "a matter of law" has been overcome then SSAT themselves don't fare that well at not making glaring errors. A recent example that I'm aware of is that SSAT have basically concluded that 50k equally shared equates to 47K and 3K and that the two halves of 5k is 5K and 0K. Of course the CSA gave them the grounds for this example of mathematical wizardry. I strongly suspect that the grounding was not only in the decisions passed on but that people have been passed on as well and that the mentality, that a liable parent should never have a cent to their name, is now in existence in SSAT.

Note that although I knock the CSA I am not knocking individuals in the CSA, some, I know, are very helpful, thoughtful and kind people.
MikeT said
"A capacity to earn decision, is I believe the only situation where a citizen has to pay, what are effectively taxes, based not upon what a person has but on what a person could have under different circumstances. Imagine if income tax were based upon a capacity to earn if some "cronie" basically just thought that you should. Imagine if income support payments were only given if there were a provable incapacity to earn"

Not entirely sure what you mean here but obviously this part of the legislation has been developed to discourage people changing their work patterns to reduce their obligations. I am interested in how this shifted in the "Best Interests of the Children" report.

The concept has different implications for the payer and payee. Your fighter pilot case demonstrates that it was used to exploit a payer based upon an assumption that he was trying to reduce his income and subsequent obligations. For mine I have a payee who is studying a 4th degree, who left fulltime work to engage in a higher degree. My point is that if not all 3 criteria had to be met, the payee would be obliged to work to support her studies rather than be supported to not study and rely upon increased support from the Payer, not to mention increased Commonwealth FTB's.

MikeT said
"I say in theory, as the CSA have a track record, supported by an Ombudsman's report, of applying(distorting) the legislation in order to artificially increase their standing. Their standing is the amount that is collected or transferred which actually then equates to an amount of FTB payments that can be clawed back (i.e. in all but name a tax)."


Can you point me to the Ombudsman's report? And can you further explain the 'standing' point.

This is interesting. Is a key principle of CSA's disposition to increase the obligations of the private citizen so as to reduce government input? If so are able to see how that might pan out re my previous point and "increased support from the Payer, not to mention increased Commonwealth FTB's."

Regarding the last criteria - (eg hard to prove a non-event) - this is currently interpreted in a very limited manner from my reading. It is considered in an active sense, that is the payee must be seen to actively seek greater income form the payer. However, when one makes a decision to change their work pattern, they must make an assessment of where income will be forthcoming. That is maybe a passive assessment (for want of a better word). If my payee decides to forego the income of $70,000, to study at $20,000. She must be making an assessment about where she will receive income support? Given that The Guide says: The provision refers to 'a major purpose' not 'the major purpose'. This means that the parent can have more than one major purpose in making the decision. A major purpose does not have to be the dominant purpose. It is more than a 'significant purpose'. A suitable test would be whether affecting the child support assessment was one of the most important factors in the parent's mind at the time of making the decision about his or her working arrangements. In my case the decision was clearly made on the basis that it was not "the major purpose". I argued it was "a major purpose". I was told by the SCO she didn't have to explain herself. The SCO was very professionally unprofessional, but thats another story. Thanks, appreciate your input.

Last edit: by MikeT

http://www.ombudsman.gov.au/files/CSA-HumanServices_Capacity-to-pay_final_abridged.pdf
Sorry… last post went format crazy… thanks for link

"A capacity to earn decision, is I believe the only situation where a citizen has to pay, what are effectively taxes, based not upon what a person has but on what a person could have under different circumstances. Imagine if income tax were based upon a capacity to earn if some "cronie" basically just thought that you should. Imagine if income support payments were only given if there were a provable incapacity to earn"

Not entirely sure what you mean here but obviously this part of the legislation has been developed to discourage people changing their work patterns to reduce their obligations. I am interested in how this shifted in the "Best Interests of the Children" report. The concept has different implications for the payer and payee. Your fighter pilot case demonstrates that it was used to exploit a payer based upon an assumption that he was trying to reduce his income and subsequent obligations. For mine I have a payee who is studying a 4th degree, who left fulltime work to engage in a higher degree. My point is that if not all 3 criteria had to be met, the payee would be obliged to work to support her studies rather than be supported to not study and rely upon increased support from the Payer, not to mention increased Commonwealth FTB's.

"I say in theory, as the CSA have a track record, supported by an Ombudsman's report, of applying(distorting) the legislation in order to artificially increase their standing. Their standing is the amount that is collected or transferred which actually then equates to an amount of FTB payments that can be clawed back (i.e. in all but name a tax)."

Can you point me to the Ombudsman's report? And can you further explain the 'standing' point. This is interesting. Is a key principle of CSA's disposition to increase the obligations of the private citizen so as to reduce government input? If so are able to see how that might pan out re my previous point and "increased support from the Payer, not to mention increased Commonwealth FTB's."

Regarding the last criteria - (eg hard to prove a non-event) - this is currently interpreted in a very limited manner from my reading. It is considered in an active sense, that is the payee must be seen to actively seek greater income form the payer. However, when one makes a decision to change their work pattern, they must make an assessment of where income will be forthcoming. That is maybe a passive assessment (for want of a better word). If my payee decides to forego the income of $70,000, to study at $20,000. She must be making an assessment about where she will receive income support?

Given that The Guide says: The provision refers to 'a major purpose' not 'the major purpose'. This means that the parent can have more than one major purpose in making the decision. A major purpose does not have to be the dominant purpose. It is more than a 'significant purpose'. A suitable test would be whether affecting the child support assessment was one of the most important factors in the parent's mind at the time of making the decision about his or her working arrangements.

In my case the decision was clearly made on the basis that it was not "the major purpose". I argued it was "a major purpose". I was told by the SCO she didn't have to explain herself. The SCO was very professionally unprofessional, but thats another story. Thanks, appreciate your input.
Theodor said
And can you further explain the 'standing' point.

The CSA reports to the DHS who then report basically to ministers. The annual report and others never make mention, to the best of my knowledge, any mention of how many children have actually been supported (this due to the half-hearted attempt to legislate financial responsibility i.e. there is nothing that enforces the financial responsibility upon the recipient of monies that are meant to be destined for the child or children). The top line is how much money has been transferred(private collect) and collected. This then equates to the saving in FTB payments, at a 50c saving for each $1 (actually this is not always the case but I'm unaware of any calculations that take into account the non-saving scenarios). The CSA have an overall bonus system based upon this top line amount. Furthermore, CSA workers have performance indicators that are basically linked into the amounts collected or transferred. Therefore each worker is pressured into collecting or transferring more rather than having indicators that relate to actual children supported (again no hope of proof due to the very collect/transfer biased legislation).

Further evidence of this bias in the legislation is again with the COA process. Basically the steps/stages of COA are that grounds have to be found for the reason or reasons. The decision has to be just and equitable. the decision has to be otherwise proper. This otherwise proper, from the information that I have seen, is that this only means that the FTB claw-back mustn't be adversely affected. I'm aware of a decision that considered it otherwise proper to force a parent to put the general public at risk of death and injury by forcing a parent to need to, work excessive hours, contrary to OH & S legislation, to not have essential with safety equipment nor to have a healthy working environment, all of which greatly heighten the risk to the general public. Other decision also blatantly ignore what is in the best interest of not only children but potentially every Australian, purely for the sake of collecting or transferring more and thus reducing FTB payments.

Theodor said
Regarding the last criteria - (eg hard to prove a non-event) - this is currently interpreted in a very limited manner from my reading. It is considered in an active sense, that is the payee must be seen to actively seek greater income form the payer. However, when one makes a decision to change their work pattern, they must make an assessment of where income will be forthcoming. That is maybe a passive assessment (for want of a better word). If my payee decides to forego the income of $70,000, to study at $20,000. She must be making an assessment about where she will receive income support?

Both payee (recipient) and payer(liable parent) can be subject. I have little doubt that if an investigation of COA's were undertaken that capacity to earn is applied for far more often to liable parents. I can only recall of one instance that I have seen where capacity to earn has been applied to a recipient. In that case the recipient (I think it was Ryan, a search here for Ryan will provide a link to the decision) had worked extra hours during the summer holidays, when there would be less opportunity for the "lives with" parent to work due to their caring responsibilities, thus making a case which SSAT found and applied. However, as one would expect, as the Ombudsman's Report found, the CSA did not. This equated to the recipient's $25k ATI being raised to $42k, if I recall correctly; a very significant amount.

You say that a changed work pattern must result in an assessment. Yes but only, unless through COA reason 8, via the changed taxable income. When it comes to COA, as explained the bias of the SCO's (Senior Case Officers) comes into play and as I've said a recipient will very likely not have a capacity to earn applied when in similar circumstances a liable parent would. The issue here is basically that you have a a person making judgements with nothing near approaching the qualifications of those who should be making such decisions. I believe that SCO's have to have some sort of legal understanding. However, it is abundantly clear from published SSAT and Court publications that they have little clue or if they do, then they very frequently purposefully pervert the course of justice, likely to earn a few extra brownie points, although I believe, based on information that I am aware of, that there are some who use this to enact their hatred for a gender; a conflict of interest(sic as in sickness) that should not be tolerated.

My belief is that the CSA should only have an administrative task of managing a system that makes sound, consistent (especially regard parental CS status), and transparent decisions. I can see a likeness between the CSA and the ATO. However, CS is far simpler. The ATO can and have managed to produce what is a relatively simple system that can be managed by ordinary people through the use of the annual forms or computer-based program. I envisage and advocate for a similar type of system where, due to the need for greater scrutiny of evidence, due to that evidence coming from often opposing/warring sources. The CSA's role should simply be to rubber stamp such evidence, tick the boxes and hey presto decision made. Such administrators would cost taxpayers a lot less. It would without doubt save the lives of those who see no option other than to take take their own life due to some of the CSA's "Deem and Destroy" decisions.

I think you may understand that I understand, at least a little, how you feel aggrieved. If you went to SSAT and perhaps then to court that may have been reduced. What your SCO said is consistent with what other's have said. One was even reported (on here I think) to have said that she's allowed to ignore the legislation and make whatever decision she wants. Total and utter disrespect for Australian legislation and a contravention of the APS guidelines. Such people(sic) should have no place in the CSA and very likely no place in Australian society. Another more than sound reason why SCO's in general should not exist and that the CSA's role should simply be administrators of a computer based decision making system, with just and equitable decisions built into the system. Basically this has been put forward by the SPCA, at least for COA, but I strongly suspect that there are a large number who know that this would mean a reduction in FTB claw-back as such decisions would without doubt correct the horrendous bias towards collecting and transferring unjust and inequitable amounts of CS.

(cross reference this with my other responses and the savings for Australia would be far greater).
In terms of savings to the nation, a fair CS would mean that the 200,000 self-employed men who have not lodged a tax return in 5 years would have reduced incentive to fail to lodge; the many thousands of "payer" parents (nearly all men) who are unemployed or on some form of income support such as the DSP because working would be a loss-making proposition; the many thousands of women of school-aged children who sit at home (in the house that he used to own half of) playing house and doing lunch, collecting quite large amounts from the ex, would all be able to go to work, pay taxes and stop collecting taxpayer dollars.

The CSA itself could be abolished, saving over $500million a year in running costs and all of the money that is currently collected could be easily replaced with a child support levy of just $5 per week per taxpayer, based on current workforce participation. More workers would mean less per worker, or more for children. Payments could be managed by Centrelink, which for all its flaws has shown itself at worst to be far better than the CSA at managing cash, while collections would be simply and cheaply done through the taxation system.

The losses are huge and increasing, but no doubt someone will, as usual when thsi subject is raised say "I'm not paying for your children", ignoring the fact that they already are paying for very many people's children, as well as the adults they call parents…
Craigo said
The losses are huge and increasing

According to a report by the well reputed PIR; back in 2004, the cost to the nation to collect $1 was then over $5 and rising at a remarkable rate. I would suggest that it could well cost the nation well over $10 to collect $1 now.
I certainly haven't seen a logical approach by the CSA, and I can't get an answer to any question that isn't firmly located within their very narrow case focus, or compliance focus. There is a profoundly bureaucratic culture that dampens things down and offers very little in terms of authentic avenues of appeal. The CSA intervenes in people's lives but fails to be accountable to the outcomes of its decisions. It is a massively irresponsible institution. The COA is a contrary decision waiting to happen, the SSAT is stacked against equitable outcomes, bogged down by turgid policy and legislation that no one can explain, and provides no-one with the capacity to make a half informed assessment before they face the welfare squad. I have written to the Ministers with clear and simple questions and the responses go missing, are a long time coming or packed with platitudes. CSA for me generates a massive disincentive for the payee to take responsibility for her life, whose ongoing dependency is state sponsored. Half baked at best.
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