Child Support (Assessment) Regulations (Amendment) 1998 No. 164
EXPLANATORY STATEMENT
Statutory Rules 1998 No. 164
Issued by the Authority of the Assistant Treasurer
Child Support (Assessment) Act 1989
Child Support (Assessment) Regulations (Amendment)
Section 164 of the Child Support (Assessment) Act 1989 (the Act) provides that the Governor-General may make Regulations for the purposes of the Act.
The Act provides for the administrative assessment of child support by the Child Support Registrar according to a formula set out in the Act, as well as for acceptance by the Registrar of consent agreements between parties as child support agreements.
Regulation 6 - (Inflation factor)
In determining a person's child support income amount, section 55 of the Act provides for a person's taxable income to be multiplied by an inflation factor applicable to the particular child support year, as set out in the Regulations.
The purpose of the proposed Regulation is to prescribe the inflation factor to be applied to a person's taxable income in relation to the 1998/99 child support year. The amending Regulation will include a figure of 1.04 as the inflation factor for the child support year ending on 30 June 1999. The inflation factor is based on the estimate of a 4 per cent increase in average earnings (National Accounts basis excluding superannuation and redundancies) for the 1997/98 financial year.
The Regulation will commence on 1 July 1998.
Overview
The Child Support (Assessment) Regulations (Amendment) 1998 No. 164 was enacted to address the need for updating the inflation factor used in the calculation of child support payments as required under the Child Support (Assessment) Act 1989. This amendment was made by the authority of the Assistant Treasurer to ensure that the inflation factor applied to taxable income for determining child support amounts reflects the current economic conditions accurately. The policy objective is to maintain the purchasing power of child support payments in line with economic changes, ensuring that the financial assistance provided to children remains effective. The regulation specifies an inflation factor of 1.04 for the 1998/99 child support year, based on an estimated 4 per cent increase in average earnings for the 1997/98 financial year. This adjustment aims to keep the child support framework responsive to economic fluctuations, thereby supporting the legislative intent to provide fair and adequate child support.
Scope and Application
The Child Support (Assessment) Regulations (Amendment) 1998 No. 164 applies to all individuals and entities involved in the administrative assessment of child support in accordance with the Child Support (Assessment) Act 1989. This encompasses persons required to contribute child support, those receiving child support, and the Child Support Registrar who oversees the assessment process. The Act operates across the Commonwealth of Australia, ensuring a uniform approach to child support assessment. The application of the Act is not restricted by geographic boundaries within Australia, making it applicable nationwide. However, the Act does not extend to state-specific child support arrangements and is subject to any relevant state or territory legislation. Additionally, the Act does not apply to certain income exclusions and exemptions as specified within its provisions, nor does it apply to specific thresholds which may be delineated in subordinate instruments. These subordinate instruments can further refine the application of the Act, providing additional detail and adjustments as necessary.
Key Provisions
The main operative sections of the Child Support (Assessment) Regulations (Amendment) 1998 No. 164 (the Regulations) pertain to the inflation factor used in calculating a person's child support income amount. Specifically, Regulation 6, under section 55 of the Child Support (Assessment) Act 1989 (the Act), outlines the inflation factor applicable to the particular child support year. For the 1998/99 child support year, the prescribed inflation factor is 1.04, reflecting an estimated 4 per cent increase in average earnings for the 1997/98 financial year. These provisions ensure that the taxable income used in child support assessments is adjusted for inflation, maintaining the relevance and fairness of the assessment process.
The Act imposes several obligations on parties governed by these Regulations. Firstly, it mandates the Child Support Registrar to use the prescribed inflation factor when determining a person's child support income amount. This requirement ensures consistency and accuracy in the assessment process by adjusting taxable incomes to reflect changes in the cost of living. Additionally, parties involved in child support agreements must adhere to the formula set out in the Act and any amendments made through regulations such as these. This includes accurately reporting income and other relevant financial information to facilitate precise calculations.
Breaches of the obligations set forth in the Act and Regulations can lead to civil and criminal consequences. For instance, providing false information or deliberately omitting to disclose relevant financial details can result in penalties under section 124 of the Act. The maximum penalty for such offences includes fines up to $13,200 for individuals and up to $66,000 for corporations, depending on the severity of the offence. Furthermore, persistent non-compliance may result in further legal actions, including court orders and potential imprisonment. These measures are intended to enforce the accurate and honest reporting required for child support assessments.