The Commonwealth Ombudsman this morning released their report investigating how Services Australia is responding to financial abuse through the Child Support program. Economic Justice Australia (EJA) is extremely pleased by the scope and rigor of the report, particularly in its acknowledgement of the ease with which perpetrators are able to weaponise Child Support to inflict financial harm on the receiving parent; and the limited ability of Services Australia to identify and respond to such abuse under the current system.
EJA is the peak body for community legal centres specialising in social security, and the prevalence of this type of financial abuse is something that has long been clear through the casework of our member centres. This is particularly the case where the weaponisation of Child Support intersects with the social security system – for example, where a perpetrator is easily able to saddle the parent who receives Child Support with an unfair debt by manipulating the system of Family Tax Benefit Part A (FTB A) payments.
As the Ombudsman rightly noted on page 31 of their report: ‘While the intention underlying the payments is good, an issue with Family Tax Benefit Part A payments is that the legislative restrictions on Services Australia can enable a perpetrator of financial abuse to cause a receiving parent to receive a debt which Services Australia will pursue.’
The amount of FTB A that is paid to a person is based on the amount of Child Support collected from the paying parent. FTB A is then revisited after a paying parent submits their tax return. The issue is that some payers intentionally delay their tax returns for months or years, which can then land the other parent with an enormous FTB A debt.
Another key issue is that when parents receive Child Support through Private Collect, the Government has no oversight. When the payer lodges their tax return, the Government simply assumes any outstanding Child Support has been paid to the other parent in full and raises a debt for overpayment of FTB A. Incredibly, Services Australia recovers the ‘overpaid’ FTB A whether or not the payer has actually paid the receiver all the child support owed.
“This kind of financial abuse is something our member centres see all the time, so we are very pleased to have it recognised in this morning’s report from the Commonwealth Ombudsman,” says EJA CEO Kate Allingham.
“However, what the scope of this report makes clear is that there is something broken at the heart of the social security system. It’s mind-blowing that it is so easy for a perpetrator to inflict such profound financial harm on another individual; that they are so easily able to create a debt for a former partner which Services Australia is then required to pursue.
“It is particularly important to note this is happening under Agency Collect, where Child Support is collected by a Government agency rather than through a private collector. These are people who have opted into Government scrutiny; they want the Government to be monitoring these finances. And yet, if a perpetrator so much as inaccurately reports their income, there is so little Services Australia can do to protect someone from a debt that amounts to financial abuse.”
EJA is particularly pleased that Services Australia has come to the table by accepting all of the recommendations put forward by the Commonwealth Ombudsman in their report. However, while Services Australia is able to make changes to their own internal policy, they do not have the ability to make the kinds of legislative changes that would amount to meaningful reform of the social security system.
“It is great to see that the Agency is willing to exercise its power to enact change for the better. However, what Services Australia is able to do amounts to tinkering around the edges,” says Ms Allingham. “What we really need, and what we have needed for a long time, is for the Government to pursue legislative reform.
“This needs to be an absolute priority of this Parliament. We don’t know how many more spot fires the Government needs to witness before they accept that there’s a blaze.”
[ENDS]
Media contact: Kirsty Sier | 0435 075 085 | kirsty@ejaustralia.org.au
Related reading:
- ‘Weaponising Child Support: When the system fails families’ — Commonwealth Ombudsman, June 2025