Han and Gehrig (Child support)

[2020] AATA 4918

Han and Gehrig (Child support) [2020] AATA 4918 (15 September 2020)

DIVISION:Social Services & Child Support Division

REVIEW NUMBERS:  2020/MC019411 and 2020/MC019438

APPLICANT:  Ms Han

OTHER PARTIES:  Child Support Registrar

Mr Gehrig

TRIBUNAL:Member P Noonan

DECISION DATE:  15 September 2020

DECISION:

The Tribunal sets aside the decision under review and, in substitution, decides that the fixed annual rate of child support applies to the child support assessment for the period 1 November 2019 to 27 November 2020.

CATCHWORDS

CHILD SUPPORT – particulars of the administrative assessment – whether fixed annual rates of child support should apply – income exceeds the allowable limit – the applications for fixed annual rate not to  apply should be refused - decisions under review set aside and substituted

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been removed from this decision and replaced with generic information so as not to identify involved individuals as required by subsections 16(2AB)-16(2AC) of the Child Support (Registration and Collection) Act 1988.

REASONS FOR DECISION

BACKGROUND

1. Ms Han and Mr Gehrig are the parents of one child subject to a child support assessment.

2. On 31 January 2020 Mr Gehrig lodged an application for the fixed annual rate of child support not to apply to the child support assessment for the period 1 November 2019 to 20 March 2020. On 31 January 2020 the Child Support Registrar (“the Registrar”) decided to accept Mr Gehrig’s application.

3. On 10 February 2020 the Registrar decided to extend the child support assessment past the child’s 18th birthday to 27 November 2020. On 13 February 2020 the Registrar decided to vary the annual rate of child support payable from $1,443 to the minimum annual rate of $435 for the period 21 March 2020 to 27 November 2020 on the basis of the decision taken on 31 January 2020 that the fixed annual rate not apply.

4. Ms Han subsequently lodged objections to both decisions to not apply the fixed annual rate. An objections officer then decided that both decisions were correct. Ms Han then applied to the Tribunal for review of the objections officer’s decisions.

5. The Tribunal heard Ms Han’s application on 5 August 2020 and she gave evidence on affirmation. Mr Gehrig informed the Tribunal that he would not be participating in the hearing. The Tribunal determined it appropriate to continue with the matter. Mr Gehrig remains a party to the matter. The Tribunal had before it documentation provided by the Department. Ms Han also provided written submissions and supporting documentation all of which were exchanged prior to the hearing. The Tribunal deferred making a decision in this matter to obtain further information from the Registrar. This information concerning the income of Mr Gehrig was subsequently received from the Registrar. Further submissions were subsequently received from both Ms Han and Mr Gehrig.

CONSIDERATION

1. The predominant legislation relevant to this application is contained in the Child Support (Assessment) Act 1989 (the Act). The relevant provisions are summarised below.

2. Division 7, Subdivision B of the Act sets out provisions relevant to annual rates of child support for low income parents and minimum annual rates of child support.

3. Ms Han informed the Tribunal that she believed Mr Gehrig’s income has increased due to him receiving jobseeker and COVID-19 supplement payments. Further Mr Gehrig owns a rural property and derives income or potentially derives income from that property. Under such circumstances she disagrees with the decision that the fixed annual rate not apply, as she believes Mr Gehrig’s income is now sufficient for him to make a higher contribution to the financial support of the child.

4. Following the hearing the Tribunal obtained from the Registrar a statement of benefit types received and the fortnightly amounts received by Mr Gehrig for the period 31 January 2020 to 31 July 2020. For privacy reasons this statement was not exchanged. However, the Tribunal subsequently forwarded for comment the following:

   “The Tribunal invites both parties to this matter to make submissions and comments (if any) by 3 September 2020:

   ·The Tribunal has received information from the Department that reflects that, in the period 30 January 2020 to 24 August 2020, Mr Gehrig has received income support payments totalling $11,828.68. The Tribunal notes that current set rates of payment, of the type of income support payment being received by Mr Gehrig, when considered in conjunction with his stated annual farm income, may result in his income for the 12 months from the date of his application (being 30 January 2020), exceeding the parenting payment single rate of $19,981. This may result in section 65B of the Child Support Assessment Act 1989 not being applicable and an assessment under section 65A being required. The consequence of this may be that the fixed annual rate will apply as the Tribunal considers that farmhouse allowance is not an income support payment.

   ·Further section 151D of the Child Support Assessment Act 1989 may operate to extend any such decision automatically. Accordingly, the Tribunal may consider that the only operative decision under review is the first decision of the Department appealed. The consequence may be that the assessment made with respect to this decision will continue automatically until the assessment is terminated.”

5. The relevant legislation regarding the application of fixed and minimum rates of child support payable by a parent is contained in sections 65A, 65B and 66 of the Act. Section 65A provides, relevantly, that the Registrar must assess an annual rate of child support of a low income parent who is not receiving an income support payment as the rate specified in subsection 65A(2). Subsection 65A(1) relevantly requires 3 criteria to be satisfied for this to occur:

   (a)  the parent did not receive an income support payment during the last relevant year of income;

   (b)  the parents adjusted taxable income for the last relevant year of income was less that the parenting payment (single) maximum basic amount;

   (c)   the parent does not have at least shared care of the child during the relevant care period.

6. Section 65B allows for an application for section 65A not to apply to be made. Subsection 65B(2) states that the parent making the application must provide evidence to the Registrar to demonstrate that their income is less than the pension PP (single) maximum basic amount and that it would be unjust and inequitable to expect them to pay the amount assessed.

7. Mr Gehrig began receiving jobseeker payment on 10 March 2020. In the 24 months prior to his application he was in receipt of farmer allowance. Farmer allowance is not an income support payment as set out under section 23 of the Social Security Act 1991. The Tribunal is therefore satisfied that Mr Gehrig did not receive an income support payment in the 2018-19 financial year which is the last relevant year of income for the purposes of subsection 65A(1) of the Act. The Registrar’s records reflect that Mr Gehrig’s 2018-19 adjusted taxable income was approximately $3,187 which the Tribunal finds is less than the PP (single) maximum basic amount.

8. The Tribunal has considered Mr Gehrig’s lengthy written submission, received in response to the Tribunal’s correspondence post hearing sent to Mr Gehrig. Mr Gehrig set out, amongst many other irrelevant claims, his reasons as to why the fixed annual rate should not apply. The Tribunal prefers its reasoning, as set out below, as to why it should in fact apply.

9. With respect to jobseeker payment, from 25 August 2020 to 24 September 2020 the maximum rate payable is $1,115.70 per fortnight. From 25 September 2020 to 31 December 2020 the rate payable is $815.70 per fortnight. The Registrar informed the Tribunal that Mr Gehrig has received $11,828.68 in income support payments since the date he made his application for the fixed annual rate not to apply until 24 August 2020. In the past few fortnights this consisted of $550 in jobseeker and a supplement payment of $531. Accordingly, the Tribunal estimates that Mr Gehrig will receive $1,081 per fortnight from 25 August 2020 to 24 September 2020 or approximately $2,393 and $800 per fortnight from 25 September 2020 to 31 December 2020 or approximately $5,600 and $550 per fortnight from 1 January 2021 to 29 January 2021 or approximately $1,100. This totals $9,093. When this figure is added to Mr Gehrig’s already received income support payments the Tribunal estimates his 12-month income, from the date of his application, to be approximately $20,921. This is above the parenting payment single rate of $19,981. Accordingly, the Tribunal is satisfied that section 65B should not apply in this instance and section 65A remains in effect for consideration.

10. In considering the criteria set out under subsection 65A(1) the Tribunal has found that Mr Gehrig did not receive an income support payment during the last relevant year of income. The Tribunal has found Mr Gehrig’s adjusted taxable income for 2018/19 was less than the PP (single) maximum basic amount. The Registrar’s records also reflect that Mr Gehrig does not have at least shared care of the child during the relevant care period and the Tribunal so finds. The Tribunal has also found that Mr Gehrig’s current income is not less that the PP (single) maximum basic amount. Accordingly, Mr Gehrig’s application for the fixed annual rate not to apply should not be accepted. 

11. The next consideration for the Tribunal is the period to which the fixed annual rate applies. On 10 February 2020 the Registrar decided to extend the child support assessment past the child’s 18th birthday to 27 November 2020. Under such circumstances section 151D of the Act sets out that the Registrar must continue the child support assessment until the child support terminating event, being 27 November 2020. As such the Tribunal finds that the fixed annual rate of child support applies from 1 November 2019 to 27 November 2020.

12. Finally, the Tribunal notes that Ms Han raised concerns with respect to Mr Gehrig’s capacity to pay more child support than that assessed under the fixed annual rate. As explained to Ms Han such concerns may be addressed by making an application for a change of assessment to the Department.

DECISION

The Tribunal sets aside the decision under review and, in substitution, decides that the fixed annual rate of child support applies to the child support assessment for the period 1 November 2019 to 27 November 2020.