Senator the Hon Joe Ludwig
Minister for Human Services
5 March 2009
Speech to the Family Law Conference
Thank you for inviting me to this conference and for the opportunity to talk with you.
Before I begin, Id like to acknowledge the traditional owners of the land on which we are meeting, the Kulin nation. I also pay my respects to elders past and present.
Family separation is an all too common occurrence in Australia - a point that has been reinforced to me since becoming Minister for Human Services in the Rudd Government.
From your own work with separating and separated families, you are aware they are confronted by a complex and largely fragmented family law system. Families who need to access the system and its services often struggle to make sense of what they should do.
At a recent speech to the Inaugural Family Law System Conference, the Commonwealth Attorney-General Robert McClelland identified this area as a key area of reform, calling for an integrated family law system with clear client pathways, to minimise, mitigate and manage entrenched conflict.
The Minister for Families, Housing and Community Services and Indigenous Affairs, Jenny Macklin, is similarly passionate about ensuring that separating families get the support, assistance and services they need.
As Minister for Human Services, I am responsible for delivering some of these services to families, including child support, and the interlinked welfare payments like Family Tax Benefit.
My portfolio includes the Child Support Agency (or CSA) which deals directly with one-and-a-half million separated parents. Like Ministers Macklin and McClelland, I am dedicated to ensuring that the Commonwealth government assists and supports families who are contemplating or going through this difficult time.
My job is to have a customer focus and come up with better ways of making the Child Support Scheme work with the other parts of the system such as the courts, the Family Relationship Centres, Centrelink and state child protection authorities. The various agencies and departments in this area want to do better and have been working on achieving this through joining up services.
Today I want to outline a few of my thoughts identifying from a Human Services portfolio view the areas of most difficulty and focussing on possible directions for reform.
But first, it might be useful if I gave you a quick summary of the interaction between family law and child support and a snapshot of what the agencies in the portfolio do and what they cant do.
Family law system and child supportThe seminal work for reform to the Australian family law system is still the 2001 report of the Family Law Pathways Advisory Group called Out of the Maze. The report said that for many people, the system was more like a maze than a co-ordinated and supportive network of services.
Weve come a long way through that maze since the reports publication. For example, 25 family relationship centres, 14 childrens contact services and 22 early intervention services were opened in 2008. To assist high conflict families, 14 post-separation cooperative services in regional areas were established. And the Attorney-General has also announced new accreditation rules for family dispute practitioners based on new standards of competency.
The reforms to the Child Support Scheme, completed on 1 July last year, have complemented the changed nature of separated parenting in Australia.
Before the reforms began in July 2006, the CSA was disconnected from the broader family law system, and couldnt help the huge number of separating and separated parents with major concerns about contact and emotional issues.
The new child support formula deals with both parents incomes on an equal basis, and recognises both the share of care of the children, and the real cost of raising children, based on independent research.
These two key elements of the child support equation the incomes of both partners and the share of care interact, and the system now fairly balances income earned with care undertaken.
All of this is in response to the need to bring child support and family law up to date with the changes and shifting attitudes towards the family unit and separated parenting. It is quite a different Australia to when the first Child Support Scheme began 20 years ago.
The reformed Child Support Scheme has been successfully implemented and is now fully operational. Minister Jenny Macklin and I continue to monitor the system closely, but I think its fair to say the new Scheme has delivered a better and more balanced scheme for separated families.
The previous arrangements meant parents had problems accessing appropriate counselling and support services, and many family and community service providers had limited capacity to adequately help parents with issues they faced after separation. It was also expensive, time-consuming and difficult for parents with conflict to have their issues resolved through the Family Law courts.
But there remains unfinished business, with families still having difficulties accessing the most appropriate services at the times they need them.
The CSA has a unique view of this complex system from its position at the crossroads between paying and receiving parents. It has a window on the complexities of relationship breakdown and post-separation conflict.
The CSA is making progress in developing pathways or roadmaps to help families navigate the system but we can do much more to reduce the fragmentation in service delivery and the inherent complexities in the system.
Its primary role today, however, is as a payment transfer agency. The principal objects of the Child Support Act are:
- that children receive from their parents the financial support that parents are liable to provide; and
- that periodic amounts payable by parents towards the maintenance of their children are paid on a regular and timely basis.
I ask for your understanding if I seem obsessed about this. The level of outstanding child support debt is too high and we need to get it down. The domestic debt now stands at around $775 million and total debt stands at more than $1 billion when international cases are taken into account.
However, most parents do the right thing. About 53% of all separated parents transfer the child support between themselves without the CSAs further involvement (once the Agency has calculated the amount to be transferred).
Of those 47% for whom the CSA collects and transfers, half of separated parents pay their child support obligations in full and on time
Last financial year, more than $2.8 billion in child support was transferred between parents.
That still leaves a substantial proportion who do not pay the full amount or anything at all. High income earners are unfortunately among those most prone to avoid paying their child support.
These are challenges the CSA has to meet. Its job is to maximise the payment because, as the Act recognises, its in the best interest of the child. It is also in the best interests of society to ensure that parents meet their obligations to support their children, rather than foisting those duties onto the taxpayer.
In order to get on with meeting the challenge, last June, I launched the CSAs Compliance and Enforcement Strategy to coincide with the start of the third and final tranche of the Child Support reforms.
I have also announced four additional measures:
[*]The extension of covert optical surveillance[/*][*]A new tax regulation requiring both parents to lodge a tax return[/*][*]New arrangements with the Insolvency Trustee Service of Australia to seize assets[/*][*]Stopping salary sacrifice being used to minimise child support obligations[/*]Since then, Ive signed a Memorandum of Understanding with my colleague, the Minister for Immigration and Citizenship, Senator Chris Evans, giving the CSA direct access to his departments passenger movement database. This information is used to identify the overseas travel patterns of parents who have significant child support debts and issue them with departure prohibition orders, if they refuse to meet their obligations.
Other compliance activities include:
[*]Tax refund interceptions[/*][*]Increased litigation[/*][*]Income minimisation investigations[/*]The Australian Government has invested $161 million to increase compliance and enforcement activity over four years. This program has already collected an extra $180 million for CSA customers $34 million more than expected. That does not include downstream savings from the welfare system.
Current Issues in the System from a Human Services perspectiveFrom the perspective of the Human Services portfolio, there are several issues in how the system interacts that are, in my own view, unsatisfactory. I will start off with the issue of care.
In a perfect world, everyone would have a parenting plan and pay on time. But the reality is one of ongoing compliance activities and flouted court orders.
Almost half of separated families with children choose to have the CSA collect and transfer child support from paying parents to receiving parents. In the CSAs experience, it is this customer group that has the highest potential for disagreements. The way these disputes manifest themselves is in most cases, the refusal to pay child support. Given the number of care decisions the CSA makes, we can see that care is a significant factor in many disputes.
The Question of CareAs it stands, the child support formula uses the amount of care given to calculate the child support payment amount to be transferred. This care percentage is based on the number of nights per year spent with each parent. In most situations, parents will agree on this amount of care, for example Rodney and Susan may agree they have a 60/40 split in care of their two children.
But sometimes theres a shortage of information, either from parents who cant be contacted or from those who want to avoid the CSA. Too often, parents dont agree and then the percentage of care becomes a contentious issue.
As we have seen the child support formula uses a care percentage, but in addition the Family Tax Benefit payment from Centrelink also uses a care percentage. But this is differently calculated so there can exist significant financial reasons for parents near the thresholds to dispute care.
If theres a parenting plan or court order for care, the CSA will generally base the levels of care on the information in the plan or order. But often, there is not, and in these cases a CSA decision is also required.
In the past six months, the CSA made about 111,000 care decisions around 18,500 a month. Many care decisions are not disputed and fairly straight-forward, but approximately 700 of these care decisions each month are considered contentious or complex.
Before the reforms, parents had no option but to go to court. This wasnt a practical solution, as many child support customers are on low incomes. For parents who could afford to go through the courts, it was time-consuming and stressful, often increasing antagonism between the parents who already clearly werent on the best of terms.
As Ive said, the CSA does make 111,000 care decisions; it cannot make one parent stick to the terms of the agreement, parenting plan or court order. This is particularly so with regards to access to the child.
The CSA simply does not have jurisdiction to enforce care arrangements. The objects of the Act circumscribe its role as a collection agency. Wherever it can, it supports parents, or refers them to services that can help them to come to their own agreement about what care levels suit them and are best for the children.
In truth, the vast majority of cases care decisions are settled outside court processes. However, in those cases where a parenting order of the court is in place and contravened then the only remedy is for the parents to return to court.
This is, from the Human Services portfolio view, a dubious proposition. It is frustrating that the solution to the contravention of an order is at present to seek further orders.
This is from my perspective a central frustration in the system. No matter how many times, the CSA, or my parliamentary colleagues and I, or you in the profession seek to explain this point to aggrieved parents or clients or constituents, they cannot understand the rationale of a system which seeks to link care percentage to the amount enforceably paid with what in their view, should be reciprocal enforceability to the terms of the agreement, plan or order.
Let me be clear about this - I am not talking here of cases of domestic violence or abuse. I am not talking of the recalcitrant non-payer. I am speaking of those paying parents who do the right thing; abide by their end of the agreement, plan or order but who find it effectively enforceable only to them in relation to payment. I am also speaking of those receiving parents, who find themselves battling with a former partner who repeatedly breaches the arrangements for return of the children.
This is an issue that has been rightly identified as an area of reform by recommendation 5 of the Family Law Council in its 2007 report Improving Post Parenting Order Processes. It stated: That the Government establish a child orders enforcement agency, or in the alternative that the Government provide additional and specified funding to enable the State and Territory Legal Aid Commissions to assist parties to bring applications about serious contraventions of parenting orders before the family courts.
Let me say I agree, with the former rather than the latter option. That report recommended such an agency be separate from the CSA, but I respectfully disagree on the ground that parents do not need yet another agency to be shunted backwards and forwards.
Minimising Care disputesSuch enforcement of course, is a last resort.
We recognise that early intervention in conflict resolution will help couples stay together the earlier the better.
Its also best that couples who do decide to separate think about a parenting plan as early as possible.
Now, parents have options that dont need to involve the courts or solicitors.
Parents who cant communicate, let alone agree, on aspects of their child support arrangements such as care can access a range of services, including dispute resolution, through their local Family Relationship Centre, or FRC.
Family Relationship Centres and referral processesCurrently there are 65 FRCs across Australia funded by the Australian Government and managed by the Attorney-Generals Department. FRCs are staffed by independent, professionally qualified staff offering impartial services in a safe and confidential environment.
Where families separate, FRCs can provide information and advice to help people reach agreement on parenting arrangements.
This is central to children, as high levels of conflict are unhealthy for the families involved.
It is also vitally important to the CSA. If theres no agreement or plan, then it is left to deal with unresolved, protracted, long-term conflict.
Since July 2007, families who disagree about parenting arrangements must try to resolve matters by attending dispute resolution at an FRC, before going to the court. There are some exceptions to this requirement, such as cases involving family violence, child abuse or urgency.
Individual, group and joint sessions are also available to help separating families make workable arrangements for their children.
Currently the CSA actively refers customers to their local FRC or the Advice Line for information and confidential advice, yet as I mentioned, we can improve our referral processes. But in this referral process there is no prioritisation or targeting of cases where there are care disputes.
From a Human Services perspective, what is needed in cases of disputed care is a closer and clearer link between CSA and FRCs to better support customers.
With the CSA dealing with about 700 complex or disputed care decisions each month, there is a real opportunity for the CSA to proactively refer parents to FRCs for dispute resolution services.
So the CSA is planning to pilot a referral process where it would identify a disputed care matter and refer the matter to an FRC at an early stage. Parents would be required to work with a family dispute practitioner to develop a sustainable parenting arrangement that works for them and is best for the children.
The practical effect of this is that the care level applied in the child support formula would be applied after the parents with care disputation have undertaken dispute resolution at an FRC.
The pilot will also look at matters such as what constitutes a disputed care matter.
Defining this will help ensure the right care issues are addressed by the right service option, and deliver clarity to CSA staff on when to refer a customer.
FRCs would also have confidence that quality referrals would occur.
The practical implications of referring disputed care matters to FRCs also need to be examined. For example, dispute resolution in the FRCs can take up to 12 weeks or sometimes longer to reach an outcome the CSA would normally have made a care ruling before this time.
The CSA is working on a number of other projects that are linked to this concept, including improving referrals to the Family Relationship Advice Line and managing family violence matters.
I have asked my Department through the CSA to explore how we can start on this new work over coming months. At the same time, Im discussing these opportunities with my Ministerial colleagues Jenny Macklin, and the Attorney-General.
Parenting plansI am also discussing a strategy around parenting plans with Minister Macklin and the Attorney-General.
The benefits of keeping family matters out of court are obvious. In recent years the family law system has geared itself to encourage parents to try to agree on arrangements for their children without resort to court.
Following the introduction of the new Child Support Scheme finalised in 2008, much more information has been provided to parents about parenting plans.
Information about parenting plans is included in the CSA publication The Parents Guide to Child Support, which is mailed to every single new customer. Now, every parent who registers with the CSA knows that a parenting plan is a practical and concrete tool for parents.
Information is also available on our website, explaining what a parenting plan is and what components can be included. Theres also a link to Family Relationships online, where parents can find out more.
CSA staff can connect parents to the Family Relationship Advice Line, which provides parents with information about developing sustainable parenting arrangements.
Parents can also go along to their local Family Relationship Centre to get practical advice and help with developing a parenting plan.
The CSA now also has a fundamental role to play in positioning parenting plans as a key means of resolving matters of disputed care.
This means that, starting from the first interaction at registration and onwards, the CSA would dearly love customers to have a parenting plan as part of their responsibilities towards their children.
The existence of a parenting plan, or a need for one by referral to the FRC, would be the key decision-making tool for all parties.
BenefitsSo, what benefits do we expect from these two key strategies encouraging parents to make parenting plans, and actively referring disputed care matters to FRCs for dispute resolution?
These strategies will strengthen the role that FRCs play in keeping couples together, in the lives of separated parents and in reducing the need for parents to go to the courts.
Dispute resolution, conducted by a qualified practitioner in a neutral environment free of charge will help parents address and overcome the issues they have with each other, and focus on the emotional and financial needs of their children.
We will be increasing the capacity and capability of parents to come to agreements about the care of their children, encouraging them to work together in a business-like manner with the aim of reducing the need for government involvement in their child support.
These strategies will lessen the burden on family law practitioners, with the requirement built into the system that parents attend an FRC for dispute resolution before going to the courts.
And it will provide the CSA with clarity in managing administrative matters required to give effect to the Child Support Scheme.
Early intervention and preventionOf course, improved referrals for people entering or already in the family law system can only achieve so much. What about people who arent at that point yet?
While separation is unfortunately a fact of life, there are situations where it could be prevented if we identify families at risk early and offer them the support they need, when they need it before relationship breakdown is the only option.
We can start to do this by identifying high risk cases. Specialist players such as Centrelink, the CSA and other providers have the data and parental contact to identify which families could benefit from some investment in early intervention.
Sharing data and information to identify need and risks is an area for us to work on in the coming year.
Another strategy we are already focusing on is improving connections and referrals between specialist services across all levels of government, industry and the community sector. This is especially important for families experiencing violence or abuse, where early intervention is crucial.
Early intervention initiatives include:
- Improving parents access to support services such as financial counselling
- Improving referral processes as Ive already spoken about
- Increasing the use of FRCs in realising agreement between parents on their respective parenting responsibilities
- More holistic approaches to parents circumstances by Centrelink and the CSA.
ClosingMuch has been achieved over the past three years and youve been a part of that the new Child Support Scheme, the introduction of FRCs and improving the connectivity between the players in the family law system have been significant.
Now is a good time to think about what more we can all do to better support separating and separated families.
In the Human Services portfolio, we are seeking to deliver reform, improvements and efficiencies around how we work and link up with services.
The Child Support Agency, along with the other agencies in my portfolio, needs to deliver more integrated services within the system.
Our upcoming pilot of proactive referral of disputed care cases to FRCs is one particular example where we have agreed more can be done and will be done over the coming months to better link family law services.
Integrated approaches such as this would assist proactive, early prevention rather than remedial activity. And they can help catch early men, women and children who are most at risk financially and emotionally.
And Im interested in your views about what else can be done and how you all, as important players in the system, can assist.
I am looking forward to working with the Attorney-General and Minister Macklin and you, the profession, to continue our drive towards a system that delivers the least possible frustration and difficulty for families that are already going through some of the most difficult and heart-rending times.
As my colleague the Attorney-General has previously said, its imperative that each part of the system the family relationship services, legal aid, community legal centres and the courts works seamlessly with other parts of the system, to better support separated parents and their children.