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Minister for=20 Human Services > Media > Speeches > = Australia=E2=80=99s=20 child support system =E2=80=93 looking to the future

Ministerial Speech

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Senator the Hon Joe = Ludwig=20
Minister for Human Services

6 November 2008

--- Check against delivery ---

Family Relationship Services Australia Inaugural = National=20 Conference, Cairns

Australia=E2=80=99s child support system =E2=80=93 looking to the = future

Thank you for inviting me to this conference in Cairns and for the=20 opportunity to talk with you.

Before I begin, I=E2=80=99d like to acknowledge the traditional = owners of the land on=20 which we are meeting, and I also pay my respects to elders past and = present.

Acknowledgements:

Ursula Stephens, Parliamentary Secretary for Social Inclusion=20
Matt Miller: General Manager CSA.

Today I want to talk about three key points:

We have a fairer child support scheme in place which should be = allowed to=20 be bedded down. Minister Macklin and I have said we would continue to = monitor=20 the system closely.=20
We will continue to focus on improving the effectiveness of = compliance and=20 enforcement as an important element in improving the overall efficacy = of the=20 Scheme.=20
There are opportunities still out there for government to better = help=20 separated and separating families by looking to join up service = delivery=20 across the broader family law system.

I recognise it has been a period of significant change for = stakeholders and=20 service providers as the Child Support Agency has been bedding down the = new=20 formula.

I also recognise these reforms have a big impact on your work because = many of=20 you are supporting parents to avoid separation, or mediating after = separation,=20 particularly around child support agreements and shared care of the=20 children.

I believe the implementation stage has been successful. It has been a = long=20 journey getting to this point, as some of you will intimately know. = There was=20 the House of Representatives Committee Inquiry =E2=80=9CEvery = Picture Tells a=20 Story=E2=80=9D, the Ministerial Task Force =E2=80=9CIn the Best = Interests of=20 Children=E2=80=9D, the legislative process and the hard road of = implementation.

Thank you for the effort you as community service providers have put = into=20 supporting separated parents through the Government=E2=80=99s Family Law = and Child=20 Support Reforms. You have worked with parents to help them, understand = the=20 nature and effect of the reforms. And you have a crucial role of working = with=20 Government to help us bed down these major changes.

It=E2=80=99s time to take stock of where we are and look ahead.

The role for Government and the CSA in particular, now shifts to = monitoring=20 how well the new system is working. But it=E2=80=99s just as important = to look for ways=20 we can further enhance the outcomes for separated and separating = families who=20 find themselves in the Family Law system.

First, let=E2=80=99s look in more detail at the new Child Support = Scheme.

1. Better and fairer system

The new scheme is now fully operational and its implementation has = been a=20 success. Having said that, there will be teething problems - = that=E2=80=99s why I want=20 to learn from you where the pressure points are in this massive new = system that=20 transfers $2.8bn for children.

In terms of fairness, the key elements of the new child support = formula=20 include 2 important changes:

The incomes of both partners are dealt with on an equal basis.=20
Child support recognises both the share of care of the children, = and the=20 real cost of raising children, based on independent calculations. =

These two key elements of the child support equation =E2=80=93 the = incomes of both=20 partners and the share of care =E2=80=93 interact. For example, if the = incomes of both=20 parents are equal and the care is shared 50/50, then there is no = transfer from=20 one partner to the other. In cases where one partner=E2=80=99s share of = combined income=20 increases, so does the obligation. Similarly, as the share of care = increases,=20 the child support obligation falls in proportion.

The system balances in a fair way income earned with care = undertaken.

Most important, parents are encouraged to share parental = responsibilities.=20 This promotes the original vision of Child Support legislation = introduced in=20 1989 - that parents share the cost of supporting their children = according to=20 their capacity to pay, while providing adequate support to care for the=20 children.

In short, the new scheme is, as I have stated, a better and fairer=20 system.

I recently released research commissioned by the CSA and carried out = by the=20 Open Mind group. This study clearly shows increased support for the new = child=20 support scheme.

This contrasts with the results of the same survey earlier this year, = before=20 the start of the new scheme. It showed there was concern about the = impeding=20 scheme, with only 58% of paying parents expecting the new initiatives to = make=20 the system fairer. But in August, after the scheme=E2=80=99s = introduction, this had=20 risen 17 percentage points to 75%.

If we take the average of the first three research periods (May and = August 07=20 and February 2008) on the issue of whether changes improve fairness, we = measure=20 a positive response in about 62% of cases. The three-quarters acceptance = of the=20 scheme in the latest results is more positive than I expected.

The research also shows 76% of paying parents now believe the formula = is more=20 balanced. All previous responses had a 4 in front, a three-year average = of about=20 43% acceptance. This too is a positive shift.

It=E2=80=99s also pleasing to see receiving parents share this = positive view of the=20 new arrangements.

Between February and August this year, the number of receiving = parents who=20 believed the new formula is more balanced jumped 11 percentage points - = from 52%=20 to 63%. The first three times the survey was conducted, a positive = result was=20 received in an average of only 51% of cases. The most recent responses = are much=20 more positive.

But we know some parents don=E2=80=99t see the new Scheme as a = positive change. This=20 is understandable given the enormity of the changes. Some parents will = only=20 judge their position by comparing it to that under the outdated = scheme.

It was widely recognised that something had to be done about the old = system.=20 There were constant complaints from paying parents and receiving = parents.

The rigid nature of the old system set up a platform for conflict. It = set a=20 standard percentage as payment for each child =E2=80=93 with little = consideration of the=20 circumstances of the paying parent or the receiving parent.

The system needed an overhaul =E2=80=93 and the legislation setting = up the new scheme=20 passed through Parliament with bipartisan support.

The first phase of the new reforms began operating in July 2006, only = after=20 three years of research, feedback and review. The Government will = continue to=20 monitor how the new scheme is operating over the next 12 months.

2. Improving the effectiveness of compliance and enforcement

I now turn to my 2nd theme - the importance of continuing to improve=20 compliance and enforcement activities. We must deliver more timely and = complete=20 child support payments to receiving parents and strengthen the integrity = of the=20 system.

I strongly believe a fair formula and a fair Scheme cannot be = genuinely fair=20 until the obligations assigned under the Scheme are in practice actually = met. I=20 am determined and unshakeable in my resolve to ensure children get the = financial=20 support they are entitled to under the new formula.

This is all the more important now we are in the postimplementation = and=20 monitoring stage.

The Government=E2=80=99s investment of $161m over 4 years in = increasing CSA=E2=80=99s=20 compliance and enforcement activities is resulting in very significant = increases=20 in child support collections and building improved integrity and = confidence in=20 the system. So far, over 400,000 customer actions have been taken and = nearly=20 $140m collected in outstanding child support.

Earlier this year in June, I launched the CSA=E2=80=99s new = Compliance and=20 Enforcement Strategy and announced additional initiatives to enhance the = effectiveness of this work.

I am pleased to report that since that time, another key Memorandum = of=20 Understanding has been affected between CSA and the Department of = Immigration=20 and Citizenship to share information on passenger movements and = facilitate more=20 timely enforcement intervention where appropriate.

Separated parents are recognising these positive gains =E2=80=93 = that=E2=80=99s something=20 also contained in the research. This is important because it builds = confidence=20 in the integrity of the new scheme. Despite these positive trends, I = believe we=20 have a way to go in getting child support payments to flow better:

We still have a large number of parents who are not lodging their = tax=20 returns within a reasonable time, often leading to underpayment of = child=20 support until returns are lodged.=20
We have an estimated 30,000 parents who may be deliberately = avoiding their=20 child support responsibilities through use of income minimisation = schemes.=20
Many people have multiple child support cases in arrears.=20
Total child support debt has increased to over $1bn.=20
Only half of paying parents with child support collected by CSA = pay in=20 full and on time.

Going forward, I have requested the CSA focus on improving the = timelines and=20 completeness of payments, as well as continuing with enforcement actions = to=20 collect outstanding payments. More timely payment of child support will = help=20 ease some of the financial pressures facing separated parents.

I would also like to flag the importance of developing an appropriate = response to the issue for many separated parents - dealing with = non-compliance=20 with court ordered access for parents to their children.

No matter how often we say contact and payment are separate issues = and=20 mutually exclusive, in the minds of parents, they are linked.

This examined in the Family Law Council=E2=80=99s report into = Improving=20 Post-Parenting Order Processes.

The Government is now considering its response to the report.

We have made huge strides in terms of intensive collection of child = support=20 debt for that minority of parents who do the wrong thing. A good example = of=20 these intensive measures is Departure Prohibition Orders. They target = those=20 parents leaving the country with a large child support debt to avoid = paying=20 child support.

I think there is recognition that parental ordered enforcement is an = issue=20 needing attention. I have been discussing the issue with the Attorney=20 General.

Until we have an effective enforcement regime in place for those = parents who=20 continue to flaunt contact orders or prevent the other parent from = seeing the=20 children, the balance achieved under the new formula will be = threatened.

The third area I would like to discuss today is joining up Child = Support with=20 the rest of the Family Law System.

3. Joining up service delivery Child support across the broader = Family Law=20 system

As Minister for Human Services, I am responsible for service = delivery. My job=20 is to have a customer focus and come up with better ways of making the = Child=20 Support Scheme work with the other parts of the system.

In light of the reforms implemented over the past 3 years, now is a = good time=20 for all of us to consider what more we can do to better support = separating and=20 separated families.

In addition, recent upheavals in financial markets have created = significant=20 stress for some families. I note that Relationships Australia in October = 2004=20 stated that concerns about finances was rated as a major pressure on=20 relationships by just 18% of people. But just two years later, the = figure had=20 skyrocketed to 40%. The Government has responded quickly with the = $10.4bn=20 Economic Security Strategy package. It will put more money in the hands = of most=20 families from 8 December. But clearly, families are facing increased = stress -=20 which will place pressure on relationships.

The 2001 Out of the Maze Report by the Family Law Pathways Advisory = Group =E2=80=93=20 what a well entitled report it was =E2=80=93 said that for many people = the system is=20 more like a maze then a co-ordinated and supportive network of services. = As=20 Minister for Human Services, it=E2=80=99s my job is to deliver an = uncomplicated=20 system.

The Advisory Group concluded that to address the problems and = weaknesses in=20 the system, Government activities should:

increase the focus on children;=20
create opportunities and pathway choices for family decision = making;=20
improve the consistency and availability of information;=20
improve coordination nationally and regionally;=20
promote safety;=20
support fairness in the process; and=20
meet family needs as they change.

My part in the process is to make these ideals become reality, = through=20 improved service delivery.

As you have heard from the Attorney-General, there have been=20 achievements:

This year we have opened 25 family relationship centres, 14 = children=E2=80=99s=20 contact services and 22 early intervention services.=20
To assist high conflict families, 14 post separation cooperative = services=20 in regional areas have been established.=20
The Attorney-General has also announced at this conference new=20 accreditation rules for family dispute practitioners based on new = standards of=20 competency.

But there remains unfinished business from the valuable Pathways = work. We can=20 do much more to reduce the fragmentation in service delivery and the=20 complexities inherent in the system today.

I am sure we all agree separating and separated families are = confronted by a=20 complex and largely fragmented service delivery system. The various = agencies and=20 departments in this sphere want to do better, but they need to = co-operate more.=20 Families needing to access the system and its services, struggle to make = sense=20 of what it is they should do.

We need to do two major things. The first is to refocus our = efforts=20 on preventative strategies to reduce the likelihood of = separation. We=20 can work towards identifying the high risk cases. Specialist players = including=20 Centrelink, CSA and other providers have the data and parental contact = to=20 identify when families could benefit from some investment in early = intervention.=20 Having the data is only one thing.

Having said this we all recognise that in circumstances such as = domestic=20 violence immediate intervention is required. The second task is = to link=20 up. We can improve connections and referrals between special = services=20 across all levels of government and non-government.

The focus on early intervention initiatives should include:

Improved access to parent support services such as financial = counselling=20
Improved referral processes=20
Greater use of Family Relationship Centres in realising agreement = between=20 parents on their respective parenting responsibilities=20
More holistic approaches to parents=E2=80=99 circumstances by = Centrelink and CSA.=20

Sharing data and information to identify need and risks is an area = for us to=20 work on in the coming year. There is also value in looking to how we can = improve=20 the linkages between the courts and the administrative arm, and between = the=20 stakeholders and the decision makers.

The 2001 report of the Family Law Pathways Advisory Group found that = families=20 experiencing separation make contact with the system at a variety of = service=20 gateways. The system design needs to built around a new reality = =E2=80=93 that all=20 service providers within the system will become gatekeepers to the whole = system.=20 After initial assessment of needs, the system should provide information = from=20 all the various avenues of support. It would then determine the most = appropriate=20 pathway for that particular family, guiding them through an effective = referral=20 process.

One possible response to this problem is to pursue a more family = friendly=20 entry point to the Family Law System. This integrated portal could = provide an=20 easier entry point, where the various referral pathways can be = identified for=20 the parents.

It=E2=80=99s time to consider these strategies, given the evaluation = work being done=20 on the Family Law Pathways activities.

I can advise progress is being made is in the area of system-wide = roadmaps to=20 help families navigate the system and access the right service when they = need=20 it. Work is underway within the Child Support National Stakeholder = Engagement=20 Group (of which, FRSA is a key member) to develop on-line =E2=80=9Croad = maps=E2=80=9D for=20 families. Once these are developed, we will also have paper-based tools = for=20 those without access to the internet.

This approach fits well with what we are doing in the Human Services=20 portfolio. We are seeking to deliver reform, improvements and = efficiencies=20 around how we work and link up with services. Child protection is one = particular=20 example where we have agreed more can be done and will be done over the = coming=20 months to do more for children at risk. Similarly, we need to ensure we = capture=20 appropriate linkages into support networks for parents experiencing = domestic=20 violence.

I have asked my Department through the CSA to explore how we can = start on=20 this new work over coming months. At the same time, I will continue = discussing=20 these opportunities with my Ministerial colleagues - Hon Jenny Macklin, = Minister=20 for Families - and the Attorney-General Robert McClelland.

Conclusion

To conclude.

The three elements I have outlined today are mutually reinforcing. We = have a=20 better and fairer system, a more balanced system. It will continue to = work only=20 through separated parents complying with their obligations.

We need a tough compliance regime and better support for separated=20 families.

The results of CSA=E2=80=99s research indicate that the child support = community=20 appears to have accepted the recent changes and is moving forward in a = number of=20 positive areas. I want to consolidate this progress and seek = opportunities to=20 support separating families in caring and providing for their kids = through=20 better connected systems.

I agree with my colleague the Attorney-General that each part of the = system =E2=80=93=20 the family relationship services, legal aid, community legal centres and = the=20 courts =E2=80=93 needs to work seamlessly with other parts of the = system.

In addition, the Child Support Agency and Centrelink also need to be = more=20 integrated into delivery of services in the Family Law System.

Integrated approaches would assist proactive, early prevention rather = than=20 remedial activity.

There is much going on in Government and in the sector to deliver = better=20 outcomes for the families and for the children. But I think we can do = more.

And what greater inspiration do we need to push further reform than = the goal=20 of achieving better outcomes and support for Australian children.

Media Contact

Sarah Cosson =E2=80=94 0423 823 843.

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