History of the Child Support Scheme
The Child Support Scheme
The Child Support Scheme was introduced in 1988 in response to concerns about the adequacy of court ordered child maintenance and the difficulties that existed in the collection of maintenance in Australia. There were also concerns about the poverty of women and children following separation and divorce and the increasing government expenditure for maintaining children where their absent parents did not contribute towards their upbringing.The Child Support Scheme is based on the principles of parental responsibility for the financial well being of children when parents separate or divorce and limiting Government's involvement by allocating the costs of raising children in separated families between parents and the Government.
Through the Child Support Scheme, the parent who does not live with their children because of separation or divorce (the payer) is required to make a financial contribution towards their upbringing. This contribution is based on:
- the payer's income and the percentage of that income assessed on the basis of the amount that parent would contribute in an intact family
- the exempt amount of the payer's income for his/her own support when calculating income for child support, and
- the amount of the payee's disregarded income, that is, the amount the payee can earn until it affects the calculation of child support payment.
Administering the Child Support Scheme
The Child Support Scheme was introduced on 1 June 1988. The Child Support Agency (CSA) was established as part of the Australian Taxation Office to administer the Child Support Scheme. It is now part of the Department of Human Services.Under the Child Support (Registration and Collection) Act 1988, the Commissioner of Taxation was given responsibility for collecting periodic child and spousal maintenance.
Legislation that enabled the administration of the Child Support Scheme:
- Child Support (Registration and Collection) Act 1988, which moved the collection and enforcement of child support to an administrative agency (CSA) from the courts.
- Child Support (Assessment) Act 1989, which was about the introduction of a formula to calculate child support liabilities through an administrative, rather than judicial, procedure.