The Commonwealth Ombudsman has reported that Services Australia operated for six years without fully complying with child support laws, an issue that remains unresolved due to legislative delays.
Legislative Discrepancy
Services Australia became aware in 2019 that it was not fully adhering to new child support laws, with the Department of Social Services (DSS) informed in 2020. Government policy dictates that parents with 35% or less custody of a child are not entitled to child support. However, laws passed in 2008 and 2018 inadvertently made some parents in this category technically eligible for payments.
Despite awareness of these implications, described by DSS as "unintended consequences," legislation to rectify the issue has not yet been introduced to parliament.
Ombudsman Iain Anderson stated that public service agencies should not decide which parts of the law to apply, noting that the issue has persisted for six years without resolution.
Agency Actions and Oversight
Services Australia opted against implementing the new laws, citing concerns that doing so would lead to outcomes considered "unfair and nonsensical" and contradict existing government policy. The ombudsman's report indicates that both DSS and Services Australia failed to take "proportionate or reasonable" steps to rectify the issue earlier, and multiple attempts to amend the legislation over the past six years "never meaningfully progressed."
Services Australia notified the ombudsman's office in July. Government Services Minister Katy Gallagher and Social Services Minister Tanya Plibersek received detailed briefings late last year. The ombudsman found this delayed notification to be a failure of duty for agencies to inform relevant ministers "as soon as practicable" after identifying a significant issue.
Impact and Comparisons
At least 16,600 individuals have been identified by Services Australia as potentially affected by this discrepancy between child support laws and policy, with potential debts ranging from $60 to $10,000.
Ombudsman Anderson drew a comparison to the Robodebt scandal, stating both involved situations where public servants decided not to comply with the law. He noted that while Robodebt involved negative impacts on individuals, here the agencies were motivated by "valid, proper and understandable concerns," but emphasized that public servants do not have the discretion to choose which laws to follow.
Government Response and Recommendations
DSS Secretary Michael Lye issued a statement in November pledging to prioritize legislation to fix the "anomaly," with the government's intention to pass legislation with retrospective effect to ensure no parent is unfairly disadvantaged. A government spokesperson stated this week that the legislation is in the "final stages of drafting" and will be introduced when parliament next sits in February.
The Ombudsman issued six recommendations to DSS and Services Australia, all of which have been accepted. A government spokesperson affirmed the Albanese government's commitment to a child support scheme that operates in the best interests of children, reiterating the longstanding principle that parents with less than 35% care of a child should not be eligible for child support.
Related Findings
A separate Commonwealth Ombudsman investigation in 2023 found that the child support system had been used for financial abuse, a situation identified as being "amplified" by Services Australia's processes.