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Change of Assessment - Cost of Child - Capacity to Earn

I am a new member and I am looking for some assistance to track down case law in relation to change of assessment, capacity to earn and cost of child.  I also would like an opinion as to whether someone with a bit of experience thinks I am being discriminated against based on my parental status.

The situation is that my wife and I separated earlier this year and have fifty/fifty custody of the 3 children, to within two hours, week on / week off.  

Prior to the separation I worked full time and she worked part time.  Part of the reason for the split was that she wouldnt return to full time work despite my preparedness to do half the chores around the house.  She chose not to work.  I was left in the position that I had no recourse and no way of making her return to work.

Following the split, she made an application for child support.  The assessment came back based on our previous years incomes.  I didnt have a problem with this and immediately lodged a change of assessment form based on her capacity to earn.

We both hold qualifications.  I work for a state government and she works in the health industry.  Both of our jobs involve shift work.

Following the submission of the Change of Assessment I was contacted by a Senior Case Officer.  He stated that the CSA looked at the pattern of work behaviour during the last couple of years to base their capacity to earn decision on and that therefore my application was likely to be unsuccessful due to the fact that she worked part time.  My response was that the CSA was making decisions based on circumstances prior to the split and that they should be basing their decision on the current circumstances.  

When I asked about reducing my hours to facilitate child care and to ensure we were both working the same hours, as we both have the same amount of work and leisure time available to us, I was told that it would probably be viewed as my trying to avoid child support.   It is my belief that by not basing their decisions on current circumstances they are discriminating against me based on my status as a single parent.  Can someone with a bit of expertise please advise me as to whether I have a basis for a complaint to the Ombudsmans Office?

The other part of the conversation went along the line of the definition of Capacity to Earn and the fact hat the C.S.A. was making the decision based on her past work history, not the present circumstance.

Now the terminology of capacity to earn is not defined at the start of the act so I referred back the Oxford dictionary.  Capacity being the maximum amount something can contain or produce.  It is my argument that as we both have the same amount of time available to work, and despite the fact that she chooses not to return to full time work, she should be assessed as though she can.  I also contend that her capacity to work should be based on the public award for her industry sector.

Can anyone point me in the right direction to find case law or binding decisions that supports this view?

Finally I am looking for relevant decisions that pin the CSA down to the variation in the Cost of child.  During the assessment period a child support terminating event occurs.  My daughter turns 18.  At this point the assessment changes and the cost of child for the remaining two children increases by over four times the rate of inflation.  Nothing else of significance happens.  It is my argument that as they are the second and third children the cost of child should be cheaper, as all of the infrastructure is in place and school uniforms, and to some degree school books, are being passed down.  

Can anyone help me with case law or binding decisions which pin the CSA down to a Cost of Child that doesnt exceed the inflation rate?

Despite the consensus of most people I talk to, who believe that I shouldnt have to pay child support as I have the children half the time, I am not adverse to a child support payment that is fair and factors in equality.    I recognise that my full time earning capacity is marginally higher than hers and that it is all about the kids; however the Child Support Assessment Act is about providing child support, not maintaining the other parent or providing them with financial windfalls or maintaining their quality of life.    All Im looking for is a fair deal.
           without doubt CS legislation is biased against one parent against the other. Overall the very object of the acts is that each parent will meet their financial responsibility towards the child or children. However, the underlying legislation only under partially implements financial responsibility by not considering that spending the monies on the children is a financial responsibility. However, that's a moot point in regard to your query, although perhaps not a moot point in the overall sense as the same reason that such responsibility is not enforced is covered by the real reason why CS legislation discriminates based upon the liable/recipient status.

The most fundamental discrimination is the actual basis of the cost of children which underlies what a parent pays. The cost of children is based upon a child costing over $500,000 when at that time the average wage was under $50,000. It is basically mathematically nigh on impossible for a an average family to support a child and to also themselves live the average life. Other research, rather than taking many potential costs and summing them to determine the cost of children, has looked at the difference in disposable incomes of families with and without children. The results indicate, as does my very own real life situation, that the cost of children used as the basis of CS legislation is excessive by a factor of at least 10. So here's the most fundamental discrimination, the payer, on average will pay a great deal more than the real cost of the children. If full responsibility were included in the legislation, then that could be used to determine real actual costs of children with a great deal of accuracy and thus resultant fairness.

Throughout the legislation the discrimination applies. As an example payments. As a payer the amount paid is deemed to be a debt to the commonwealth and as such draconian measures can be implemented to support the collection of such monies. However, if there is an overpayment, this is also very likely a debt to the commonwealth but the same draconian measures are not implemented for the collection.

The case of capacity to earn, as you suspect is also biased as it discriminates by allowing one who does have the capacity, to have that capacity dismissed due to a history of not meeting that capacity, but conversely discounting, by the very biased 3rd factor determining capacity to earn (that one has to prove a negative i.e. having to prove that the decision of the reduced capacity was not substantially due to it affecting the CS (basically any proof would in fact be proof of the contrary)).

Capcity to earn, as mentioned, has 3 factors that must all be met. They are :

The CSA Guide - 2.6.14: Reason 8 - a parent's income, property, financial resources, or earning capacity - A parent's earning capacity said
When can CSA take into account a parent's earning capacity?

From 1 July 2006, CSA can only determine that a parent's earning capacity is greater than is reflected in his or her income used in the child support formula if it is satisfied about all of the following three matters:

1. The parent is either:

    not working despite ample opportunity to do so (section 117(7B)(a)(i)); or
    has reduced his or her weekly hours of work to below full time work (section 117(7B)(a)(ii)); or
    has changed his or her occupation, industry or working pattern (section 117(7B)(a)(iii));


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

    his or her caring responsibilities (section 117(7B)(b)(i)); or
    his or her state of health (section 117(7B)(b)(ii));


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)©.

CSA must be satisfied that all three compulsory criteria are satisfied before it can change an assessment to take into account a parent's earning capacity, rather than his or her actual income.

If the parent's circumstances satisfy only one or two of the criteria, CSA cannot make a decision based on the parent's earning capacity.

CSA must also be satisfied it would be possible for the parent to increase his or her income by changing his or her work arrangements. That is, work must be available for the parent in his or her area and the parent must have the necessary qualifications and experience to perform that work.
The off topic a little Mike said
You may have noticed that I highlighted the word satisfied. This word appears 94 times in the CS Assessment Act (one of the 4 pieces of CS legislation). Satisfied, does away with a requirement for proof, but basically allows the CSA to make a legislative finding. Something normally restricted primarily to Judges, Magistrates and less seldom to court registrars. All of whom would have an extensive legal background. The CSA, and thus all employees above CSO2 (more supportive administration roles rather than roles that deal with enactment of the CS legislation) are basically given the power of a court registrar, but few, if any would have the legal background required of a court registrar. I personally consider this as a great bias, as those employees who act as registrar are pressured (incentive schemes, promotion, even keeping the role, etc) into making decisions that have one common theme. That common theme is to collect or transfer as high an amount as possible so the CSA can report this to it's department and thus to the Government. The ridicule extends to decisions such as satisfaction that CS could not be collected because a parent was under 17 at the time of conception.  In my own recent application for assessment I had three counts of deficient administration found in a very simple/common scenario.

I believe that the CSA should at the most simply be data collectors and that an underlying automated system actually apply the rules and thus make the decisions; such a system would be less complex than the annual tax return system.

You question is in regard as to whether you can contest your decision based upon the clear discrimination. I'd suggest that you couldn't as the legislation says this. Well at least not under Australian law. To contest this you'd probably have to take it to a higher court (e.g. human rights or something). As such I don't think that there would be any useful case law supporting contesting the validity of the law. What should be done is that the laws themselves are revisited and rewritten to remove any such bias. Some quite rationally suggest doing away with CS, as the cost of collecting CS has been shown to be far greater than the amount collected (PIR report back around 2004, showed that the real cost was over $5 to collect $1).

Perhaps the very question of why such ridiculous legislation would even exist. Well the real cost of collection takes into consideration all factors, whilst the departmental consideration  saw(sees) this really, not as a means to supporting children, but really as a means of taxation and thus from a departmental sense a means of reducing the departmental spending and thus empowering the department. That is that for $1 collected FTB is reduced by 50c. It's is irrelevant to the department that due to CS and the way in which it is implemented that the resultant affects, such as small businesses being put out of business, reliance on welfare being rewarded (e.g. welfare history = no capacity and therefore normal pressure to take actions to support oneself), payers very often being made to pay ridiculous amounts.

However, I do recall recently seeing a judgement (sorry I can't remember what it was) that was on either austlii or the Family Law Courts website, that did refer to a finding regarding capacity to earn that indicated that other factors should be considered in regards to a CS case (it might have been by FM Slack) (sorry the old grey matter is getting old). I'd suggest having a look on austlii ( However, if it was Family Law then as Family Law is basically hierarchically higher than CS law, then if the latter you'd have to get the Familw Law Court to make such a ruling and I believe that such an attempt would likely result in a decision that CS legislation should apply.

Here's a few tips that I use for looking through cases on austlii. 1) Look at Federal Magistrates - Family Law, as generally magistrates rather than judges will look at CS matters. 2) Such judgements will have SSAT or the Child Support Registrar as a party, so look for these. 3) When browsing (I use Firefox) I will use find and then highlight all to find appropriate words (e.g. capacity); you can then quickly scroll through and spot the highlights and have a quick read to see if what you have found is relevant. If a previous decision/finding is referred to it will most likely be in italics.
If you have not completed your property settlement, this can be a reason why C$A are reluctant to change anything.

I think you can argue that the past working schedule was due to you two being in a relationship and now that your circumstances has changed (split up), it is only fair that you both contribute to the costs of the children as per your combined earning capacities.

It is a bit unfair during the week you have the kids that you are working full time whilst the ex has free time due to only working part time.

One question - is the ex still claiming parenting payment?

There may be little difference in your incomes as your ex may have access to generous salary sacrifice benefits from the health industry which may be causing your child support to be higher due to her taxable income being lower than normal. If you don't have access to similar benefits then you could use this in your case.

It appears that the outcome of your application will be negative (as per Mike) however Reason 8 decisions have good appeal prospects.

1) Once you have your COA decision you lodge an objection to the decision.

2) The objection will most probably also be unsuccessful.

3) The next appeal is to the SSAT and as they are also known to follow C$A policy in most cases, also expect a negative outcome.

Be very careful how you give evidence to the SSAT. Give nothing more than that is needed to argue your case. I say this as they will use anything you say to discredit you and in a court appeal you cannot argue a point of fact. In other words make sure what you say is clear an concise and there is no way they can misconstrue your evidence.

4) Court appeal - You can only appeal a SSAT decision on a point of law and not a point of fact. Even if the SSAT have not presented your evidence correctly or have got it completely wrong, the court will not even consider any of this in an appeal application.

In a reason 8 decision the last point of law that must be considered is that the decision must be fair and equitable to all parties.

If you can show that the decision made by the C$A is clearly not fair and equitable, then you have valid appeal on a point of law.

If the court supports your case they can only send it back to the SSAT for a rehearing and new decision.

This process is time consuming and clearly designed to stop you from appealing any C$A decisions, however if you persist there is a chance you might get through it with a positive outcome.

Fairgo said
If the court supports your case they can only send it back to the SSAT for a rehearing and new decision.

Fairgo, I'm not sure this is correct, even though likely. Over the past couple of days I've been looking at some SSAT decisions available on the Family Law Court Website, where I saw the following (I think a few times) :-

Halligan FM in LDME & JMA (SSAT Appeal) [2007] FMCAfam 712 at para.54: said
The Court must hear and determine an appeal from the SSAT, and may make such order as it thinks appropriate by reason of its decision (s.110F(1), Registration Act).  The orders a Court may make on a s.110B appeal include an order affirming or setting aside the decision of the SSAT, or an order remitting the case to be heard and decided again by the SSAT, either with or without the hearing of further evidence, in accordance with the directions of the Court [s.110F(2)].

In one decision (CARRIGAN & FREDERICKS (SSAT APPEAL) [2011] FMCAfam 544) they, in support of the applicant (is 2 an order???):-

CARRIGAN & FREDERICKS (SSAT APPEAL)   [2011] FMCAfam 544 - Orders said

(1)   The decision of the Social Securities Appeals Tribunal made on 24 May 2010 and despatched on 7 June 2010 be set aside.
(2)   It is declared that the appellant ceased to be a permanent resident of Australia on 17 January 2008 and this constituted a terminating event for the purposes of all pre-existing administrative assessments of child support pertaining to the parties in these proceedings.
(3)   The notice of appeal filed on 2 July 2010 is dismissed.

On a personal note, I found this quite an interesting read.
Thank you everyone.  I have been in contact with the attorney generals office and they have shown me how to use Austlii databases.  I have found case law relating to Capacity to earn and the choice of full time and part time work.  I take it the ssat are bound by previous case law if I present it.  Matter was Carlson and Acuff
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