We have been starting to see the benefits for parents and children from changes made to child support in 2021 under our transformation programme. Payments are reaching receiving carers within 2 days of the due date for a liable parent’s payment—14 days faster than before.
We wanted to help more liable parents stay on top of their child support obligations. One way to do this was removing incremental penalties on liable parents with debt.
This has helped keep child support debt stable. Debt fell by $90 million, although it should be noted we wrote off $79 million, including writing off penalties, to encourage parents to restart or keep up with payments.
We also implemented automatic employer deductions from the pay of newly liable parents in October 2021. These deductions applied to 83% of the liable parents earning salaries and wages this year.
The result of automatic deduction is an increase in parents paying in-full and on time. Before our changes, 68.3% of newly liable parents were paying their child support in full and on time over their first 6 months. Figures from November 2021 to May 2022 showed that:
- 77.7% of newly liable parents were meeting their obligations
- the percentage of new liable parents in debt within 6 months dropped from 57.3% to 45.4%.
With automatic deductions, if liable parents change their jobs, we’re also able to tell their new employers sooner. This means payments to receiving carers continue with significantly fewer interruptions.
While these improvements have helped many child support customers, they were among our least satisfied customers this year. We expected automatic deductions could lower liable parents’ satisfaction. We’re also watching the impacts of the child support pass-on as this could increase the demand for liable parents to meet their obligations.
The Child Support Scheme this year
- We processed 17,000 child support applications this year.
- 70.8% of child support assessments were paid on time.
- 2022: 70.2%.
- 7,700 liable parents put in for a change of circumstances, 12% more than last year.
- $79 million in child support debt was written off
- 2022: $181 million
- 2021: $998 million.
- 84%of debt cases were closed within 12 months.