Amanda and her seven-year-old daughter, Carly, live in a two-bedroom townhouse in Melbourne’s inner city. Because it’s part of the national rental affordability scheme, the rent is just $720 a fortnight. Even so, with her parenting payment only amounting to $776.10 a fortnight, the former company director often has to rely on food banks – especially when child support payments from her ex-partner, John, fall short.
Last year, John’s tax return reported his income to be dramatically lower than it had been previously. Now recorded as $52,500, his child support payments subsequently dropped to $329 a month from $745. The timing was devastating for Amanda, as it coincided with Carly beginning primary school and the recommendation that she be assessed for having special needs – a costly process.
Suspecting that John, who owns his own company, had minimised his income, Amanda put in a reassessment application to the Department of Human Services Child Support (DHSCS) – a risky scenario, given that she had previously taken an intervention order out on him for stalking. And then, things became truly Kafkaesque.
Amanda lodged her paperwork in August, but the assessor rejected her application, based on Amanda’s “voluminous” support documents that pointed towards John’s likely real earnings. “I complained and they wrote me an apology, but I still had to make a formal objection,” Amanda says. “I’ve now been through three people looking at my application, and yet my ex has not provided any documentation or response.”
In the five months that her case was shunted around, Amanda received five notices to vacate. Finally, John’s income was reassessed at $80,000, which Amanda thinks is conservative. He was ordered to contribute to Carly’s therapy expenses, but only those that had incurred since November 2018, which was the point that he was notified that Amanda had put in an application. Nor was he required to back-pay her child support payments at the correct income level.
“Now I have to appeal it through the administrative appeals tribunal and I’m constantly forced to engage with this person that they know there’s been a history of domestic violence with,” Amanda says. “It’s just so depressing to have that be your life. Isn’t it enough that I live below the poverty line and I can’t afford to do anything fun, or afford things for myself, to then be constantly engaging in all these bureaucratic processes just to survive?”
According to Terese Edwards, the chief executive of the National Council of Single Mothers and Their Children, Amanda’s story is all too common. And for her, non-compliance in the child support system is why so many of the 739,000 Australian children living in poverty get stuck there.
‘A huge battleground’
The Department of Human Services says about two-thirds of paying parents – non-resident parents – have no debt. And yet, as Edwards says, Amanda’s situation is far from unusual.
A major issue, she says, is that it’s hard to know such numbers considering it is widely reported that non-resident parents like John can be dishonest about their earnings – perhaps by providing only one PAYG slip, or through earning cash as a contractor, or by not lodging a tax return. The Child Support Parliamentary Inquiry of 2014 reported that in 2013-2014 there were 435,425 non-resident parents with an outstanding tax return.
“I don’t understand, with all the talk regarding the black economy and the crackdown on international corporations, how we allow payers of child support not to even lodge a tax return,” Edwards says. “The system needs to get tougher on making sure that child support is understood as being to support children, and it’s not discretional expending by the biological parent.”
The Child Support Agency was established in 1988 in the wake of Bob Hawke’s declaration that “no child shall live in poverty”. Initially the Australian Tax Office collected and enforced payments, before the scheme was handed over to the Department of Social Services and the Department of Human Services – which complainants can find themselves bouncing between.
Kay Cook, associate professor in the Department of Social Sciences at Swinburne University, says: “The tax office never wanted to deal with child support. It viewed its role as collecting income, not dispersing private income. That’s sort of the problem that child support has always had, that it’s private money being transferred, rather than public money.”
Cook’s research includes analysis of child support systems in Australia, New Zealand, the UK and the US. “In Australia we’re really cheeky in that single parents’ family tax benefits are typically calculated on how much child support they expect a parent to receive, not so much on how much they actually receive,” she says. “The government gets the savings of reducing family tax benefits so there is no incentive to the government to collect child support because if anything it costs them money.”
There’s also little or no will, she says, to solve the problem generally.
“Nobody cares about child support whatsoever in the academic world. It’s considered to be too hard and too small – even though it affects over 20% of the population. Who cares? – and it doesn’t work anywhere in the world. I am really interested in it because it represents gender roles, work/family and work/life balance. It’s love, money, politics, it’s all squished into this tiny policy that no one cares about, and it’s a huge battleground.
“These women are already triaging and multitasking and in poverty, and everyone views them with suspicion. Like how they get their money and what they do with their time, and how they’re parenting. They’re under constant assault.”
While a spokesperson for the DHS tells Guardian Australia that the department has a longstanding arrangement with the ATO to undertake lodgement enforcement activities against parents who have outstanding tax returns, Kris Natalier – associate professor in sociology at Flinders University – thinks the department has a reputation for not cracking down on fraud now that its link to the ATO is not as direct.
“They need to be taking a much more active role in pursuing late payment and non-payment, because at present it’s on the shoulders of women to raise it – and raise it again, and again, and again,” she says, “and then you’re putting the responsibility on the most vulnerable party.”
There are some useful measures in place. More than a decade ago, the ATO started using departure prohibition orders to prevent child support dodgers from leaving the country. In the first half of this financial year, 1,067 such people received an international travel ban, up by almost 50% from the same period last year. They are typically stopped at an Australian airport and told they are unable to leave until the debt is settled, often resulting in the payment being made within hours.
But when an errant parent pays arrears in bulk it exposes a big flaw in the system, says Danielle, who lives in Victoria’s Goldfields. Now that the resident parent’s income is suddenly raised Centrelink automatically reduces their benefits, which can plunge them into financial crisis.
Danielle’s ex-partner, Greg, is a contractor whose child support payments are based on his declared earnings – which are seemingly down to a third of what they were when he and Danielle were a couple. In any case, it’s impossible for the CSA to calculate accurately because he hasn’t filed a tax return since 2011. At one point he stopped paying for two years but was chased by the agency when Danielle provided photographic evidence of him working.
Greg started making large back-payments to get the debt over and done with. Each payment pushed the yearly estimate of Danielle’s income up and subsequently reduced her parenting payment and family tax benefit.
“It left me with even less money than I would have had without the child support and with no ability to budget for the months ahead,” Danielle says. “We are expected to predict our annual income, and suddenly mine went up far more than was predicted, so my benefits were dramatically reduced towards the end of the financial year.”
In its recent budget, the Coalition pledged $328m in initiatives to reduce domestic and family violence against women and children. But as Danielle, who has had a Family Violence Intervention Order (FVIO) out against her ex-partner puts it, “Once women do leave these violent situations there are no support structures in place to make sure you and your children are financially stable. That’s why a lot of women go back.”
Whereas Amanda has been moved to carer payment because of the constant appointments that tending to a child with special needs requires, Danielle receives the Newstart allowance. Since its introduction in 2013, around 85,000 sole-parent families have been moved to this scheme once their youngest child turns six. It requires them to register with an employment services provider and search for paid work of 15 hours a week. When their youngest child turns eight, they are no longer eligible for parenting payment.
A father’s experience
In 2006, the Child Support Scheme was reformed in parallel with the changes to the Family Law Act largely due to pressure from fathers’ rights groups and the recommendations of an inquiry into custody arrangements by the standing committee on family and community affairs. The new scheme introduced a new formula for assessing payments, taking greater accounts of the costs of the children, the income of each parent and the time the children spend in each parent’s care.
Key complaints from fathers’ rights groups had been that parenting costs should be split 50/50 and that resident parents sometimes manipulated more money from non-resident parents by withholding or limiting access. One father Guardian Australia spoke to agrees with the latter, though not the former. Mark and his ex-partner Fiona came to a private agreement for childcare payments via mediation.
“We got it certified by lawyers that I’d pay an agreed amount every month to cover set costs like Billy’s health insurance and some extra-curricular stuff,” says Mark, “and then whatever child support recommended – based on my income versus hers and that whole formula. I always honour it. I’m lobbying hard for more time, that’s my issue. Sometimes I think I should be like some of these other people who use money as a weapon, but it’s tough enough a situation without that.”
Still, he says, whenever requests for more money increase, it arouses his suspicions. “She’s fairly aspirational in her purchases,” he says, “and sometimes I think everything needs to be expensive to make her feel better … but you have to pick your battles.”
Mark’s a freelancer, so his finances can be feast or famine, hence there’s the base rate that he agreed to pay and then the fluctuating amount. “Sometimes I call child support up and get a new estimate,” he says. “Their online form is a nightmare to figure out but, to their credit, when you get them on the phone they’re very good.
“I’m pretty convinced I’ll have to go to court with Fiona so you can’t give any ammunition you know?
“They need to look at the record and go, ‘Yeah, well you did everything right’, but that makes my blood boil. I’m sure most of the story is it’s women who have been left with a child and are vulnerable because they can’t work enough and the male is not stepping up, but my story is another side of things that will be familiar to a lot of people.”
Can the system be fixed?
The system may be broken, but it’s not unfixable, says Terese Edwards. “One of the things that we would love to see happen is a state-guaranteed payment,” she says, which the 2014 inquiry recommended be implemented as a trial. “There, the amount is paid by the government to the woman, irrespective of the behaviour of the payer. We believe that there would be greater energy from the government to collect that debt. We also believe that it would reduce child support as being an emotional basketball, severing that financial control.”
And Edwards, Cook and Natalier all agree on another incentive for non-payers to keep compliant. “A quick fix is linking child support payment and debt to our credit rating,” Edwards says. “So if you are a payer and you pay on time, that should be a positive. If you don’t pay, likewise, that should go on your credit rating.”
The main point of interest to Edwards regarding the forthcoming election is the review of social security payment that has been an election promise by Labor. “The Labor party needs to correct their wrong,” she says. “It’s my opinion that they should immediately restore parenting payment single (PPS) to those who just can’t afford to live off Newstart and then undertake a review to ascertain the level that is required to protect people from poverty and to give them some hope.”
Natalier says there are about 1.2 million kids being covered by child support processes, not including self-administered processes, and they aren’t being brought into the debate at all. She thinks it would take child support to become a political issue for change to occur.
“There’s been such a huge groundswell of opinion around domestic and family violence – that this is not a private issue, it’s a public issue that the state has to take responsibility for,” she says. “We need that kind of shift in public debate so that there’s actually some political motivation for making this change.”
It’s not just an issue of poverty, says Natalier, it’s an “existential erosion”. “The money’s important but the experience of having your whole account of reality, and your relationship with your ex, and how you want to parent being eroded by these processes, which are never responsive to your claim, is horrifying,” she says. “When we interview women, they cry and cry and cry on the phone.”
That’s true, too, of Amanda, who cries during our interview.
“It feels as though Australians are encouraged to look at me as somehow defective and deserving of suffering because I don’t have a male patron,” Amanda says. “And it’s at my former patron’s discretion as to whether or not me and his child are worthy of being supported.”
* All names in this piece have been changed. Reporting in this series is supported by VivCourt through the Guardian Civic Journalism Trust
