Explanatory Memorandum
(Circulated by authority of the Minister for Family and Community Services, Senator the Hon Jocelyn Newman)Chapter 10 - Payments Temporarily Held In Child Support Reserve
Overview
10.1 Schedule 10 of the Bill will amend the Child Support (Registration and Collection) Act 1988 (the Registration and Collection Act) to allow the Registrar to hold money collected from a payer. This money will be held only in those cases where a payer has applied to the Family Court for a declaration that they are not a person from whom child support should be sought.
Summary of the amendments
10.2 The proposed amendment will assist in reducing the incidence of overpayments to persons receiving child support.
10.3 On a day to be fixed by Proclamation, not more than 12 months after the day on which the Act receives Royal Assent.
Background to the legislation
10.4 The Registrar has an obligation to collect and disburse money under the Registration and Collection Act, once an administrative assessment has been raised under the Assessment Act.
10.5 Section 107 of the Assessment Act allows a payer to seek a declaration from the Family Court that the applicant was not entitled to an administrative assessment of child support. The most common grounds which a payer may put forward are that:
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- they were not a parent of the child
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- the person seeking child support was not entitled to child support; or
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- child was not eligible to receive child support.
Should the Court be satisfied on one of these grounds and make that declaration, the application for an administrative assessment is to be taken never to have been accepted by the Registrar.
10.6 The Joint Committee proposed Recommendation 47 to deal with the problem of the Registrar being required to collect and pay child support despite the application by a person under section 107.
Explanation of the amendments
10.7 The proposed amendment will satisfy the recommendation of the Joint Committee.
10.8 The amendment will allow the Registrar to decide to suspend payments to a person entitled to receive child support until the Court makes a final decision on an application under section 107. The person required to pay child support will continue to be required to make payments to the Registrar but payments will be held in the Child Support Reserve and not paid out. [Item 1 - amend subsection 76(1); Item 2 - insert section 79A(1)]
10.9 A decision will have effect until the Registrar makes a further determination to resume the entitlement to payment of money collected to the person entitled to receive child support. [Item 2 - insert section 79A(2) and (4)]
10.10 The Registrar must notify the payee of either the determination to suspend or resume. [Item 2 - insert subsection 79A(3) and 79A(4)]