Over the next two years, the Australian Government will undertake a major reform of the Child Support Scheme in order to deliver a system that acts in the best interests of children. As part of the reforms the Government will do more to ensure child support is paid in full and on time. The Child Support Agency will significantly increase activities that target 'serious avoiders' and debtors, and focus on increasing enforcement options through the use of court action to recover outstanding amounts. The number of parents being investigated for deliberately understating their income will also increase.
Currently only around half of all non-resident parents, whose payments are collected through the Child Support Agency, make their child support payment in full and on time. This measure will expand existing compliance activities and will do much to address the problems caused by non-compliant payers.
The reforms of the Child Support Scheme are extensive and will be implemented in three stages over a two year period. Stage One, commencing in July 2006, includes a number of changes such as increasing the minimum payment. Stage Two, to be implemented in January 2007, includes the introduction of an independent administrative review of Child Support Agency decisions. The major formula changes will occur in Stage Three in July 2008.
This measure will be implemented from 1 July 2006 as part of Stage 1 of the Child Support Reforms.
Total Government Funding
The Government will provide $165.1 million over five years in administration costs, which will reduce Family Tax Benefit payments by $52.7 million over the same period.