Critics say Australia's child support system is outdated and has not kept pace with inflation, putting women at a disadvantage.
The federal government is currently rethinking how child support is calculated, and parents and academics say it's time to take into account the costs of childcare, laptops, branded uniforms, medical care, and the reality that public schools are no longer free. He claims to have come.
Professor Kay Cooke of Swinburne University of Technology, who has studied the system, said the way the federal government's payments were calculated had always been set artificially low, which was made worse by inflation.
And that's if child support is even paid, and data shows more parents are falling behind.
In the previous fiscal year, there was a $50 million shortfall between amounts owed and collected.
About a third of the parents in the system, or about 218,000 people, are in debt, totaling $1.7 billion in unpaid child support.
Under the current system, the minimum amount a parent can pay is $9.50 a week, or about $500 a year, and about 116,000 parents pay this token amount.
Professor Cook suggested that the rise in debt could be due to pressure on the cost of living.
“Receiving child support reduces a single mother's chances of falling into poverty by 21%, so it makes a huge difference,” she says.
Professor Cook said 84 per cent of those who paid child support were men, meaning it was women who were relying on child support.
Stepfamilies Australia director Phoebe Wallish said the impact of inflation was doubled because people with blended families were often trying to support two households.
“Child support is a really outdated system. It just doesn't keep up with the cost of living,” she said.
Wallisch said parents who receive child support also struggle when payments are irregular, and adjusting how child support is calculated won't help without audits of noncompliance.
“There are conflicts around child support, so it's important that we overhaul it in terms of having very clear guidelines for what child support is.”
“The system is completely outdated”
Professor Cook said one of the main problems with the government's calculations was that they did not take into account the reality that parents were spending more money looking after their children during the week.
This includes the cost of child care, after-school care, back-to-school supplies, medical appointments, technology, field trips, and extracurricular activities.
Caroline Page, a single mother of two, said she understood this all too well.
Under the current system, she is entitled to about $100 a week in child support to help her two sons, but she struggles to make ends meet despite working full time. There is.
“When you factor in the cost of groceries, utilities, running your car, general school expenses, extracurricular activities, kids parties, and clothing at this point, it's almost a burden,” she says. I did.
“It's completely outdated. We have a situation where our kids have to bring iPads to school as early as fourth grade. The cost of that is not considered at all.”
“Within two years we'll have to come up with a laptop and a whole new uniform and books. It's never ending.”
Despite being frugal, she said tuition continued to add up.
“There is no such thing as free education.”
Wallisch said current prescriptions also don't take into account children with special needs, who may need medication, therapy or specialist consultation.
Professor Cook said the scheme would also reduce the earning potential of primary parents, as most employment would normally take place during the week and they would likely need to work part-time to care for young children. He said he was not considering doing so.
“Studies show that after separation, mothers' income and wealth decline significantly over time, but separated fathers' income and wealth increase over time.
“It perpetuates unequal gender outcomes.”
How does it work?
The way the government calculates the payment is based on the parents' gross income divided by the proportion of care they provide.
A fixed amount is deducted from the parent's own expenses and the payment is calculated using a table called the “Child Expenses” table, which acts like a tax bracket.
|
Child support payment amount |
amount actually collected |
|
|---|---|---|
|
2019-20 |
$1.75 billion |
$1.7 billion |
|
2020-21 |
$1.74 billion |
$1.74 billion |
|
2021-22 |
$1.82 billion |
$1.82 billion |
|
2022-23 |
$1.93 billion |
$1.88 billion |
Parents' own costs are calculated by a measure called Men's Total Average Weekly Earnings (MTAWE), as opposed to inflation, which is measured using the Consumer Price Index (CPI).
Economist Associate Professor Ben Phillips said MTAWE had historically been more generous, but over the past 12 to 18 months the CPI had outperformed it.
He said better treatment could take into account both wages and inflation, similar to how old age pensions are calculated.
First review in 20 years
Bruce Smith is a professor of family studies at the Australian National University and a member of the expert panel reviewing the scheme for the first time in 20 years.
“There are certainly some unusual and perverse consequences to this official mechanism,” he says.
He said there were arguments for federally funded universal support and for more employers to withhold pay on behalf of the Children's Hand Authority.
Professor Cook said any review should consider compliance and the interaction between child support payments and family tax benefit payments.
In particular, parents can now self-report a decrease in income without evidence to reduce their payments.
This number is not necessarily adjusted when you finally file your tax return.
In that case, the other parent will be responsible for providing documentation to contest their claim.
Professor Smith said the number and amount of outstanding debts was a long-standing and ongoing problem.
This number reflects only parents who use the federal child support system and does not reflect the 51.3 percent of divorced parents who have private arrangements.
A Department of Human Services spokesperson said in a statement that MTAWE is used to ensure that living expenses are reflected in the child support system.
It also pledged $5.1 million to implement changes proposed by the recent review of the family law system.
This includes establishing a child support expert committee to fund research on child costs, review child support formulas, and develop methodologies to update child support schedules.
It also established a consultation group for those involved in child support and conducted a survey of separated parents.
“The Australian Government is committed to ensuring that child support assessments reflect the cost of raising children in Australia,” they said.
Loading…
