Capacity to pay (CTP) Child Support 277-03130000

All referrals are scrutinised by a Financial Investigator to determine if a case is appropriate for a CTP review.

All decisions are recorded in Cuba and in the CTP database using the Case Management Tool (CMT). The factors considered include:

• current income of both parents
• levels of care
• benefits
• active business links
• business incomes and expenses

Check customer records for a started CTP investigation or Change of Assessment (COA).

Is there a current investigation underway?

• Yes, stop the investigation. Procedure ends here
• No, go to Step 3

If the customer has been referred for a CTP review before, there will be a document in the Customer Details window.

Has the customer been referred before?

• Yes, go to Step 4
• No, go to Step 5

If the customer has been referred before:

• Check the outcome of the referral for the following:
• Was the CTP referral accepted and a No Further Action recommendation made, or
• Was the CTP review rejected over 6 months ago
• Review customer's record to see if new information has been supplied that makes it suitable for scrutiny. E.g., business tax return lodged or business activity statement (BAS), or s120 responses received.

If customer is receiving an income tested payment, check the income and asset information on the record.

Is there evidence of additional income or active business links?

• Yes, go to Step 6
• No, customer would not be suitable for review. Procedure ends here

A debt is not a reason to reject a CTP review.

Note: if there is a debt due to an earlier CTP or COA action and collection attempts have been unsuccessful it may not be suitable to continue CTP investigation.

If a CTP review had already been done there would not usually be another review, unless there are special circumstances such as Family and Domestic Violence (FDV).

Once a customer has been through the CTP process, they usually have enough knowledge of COA to make their own application to register an agreement.

Check if the customer's income or annual rate is set due to:

• a Change of Assessment (COA)
• an Agreement (AGR)
• a Court Varied Agreement (CVA)

If the child support case ends in less than 4 months, it would not usually be selected for review. This is based on the time it takes to complete an investigation and get an outcome.

Apply discretion on a case-by-case basis. A review should only be done in this instance where exceptional circumstances justify a CTP investigation.

There may be other information or evidence to indicate the customer’s circumstances have changed and a reassessment of their current income is needed. This information may be in the following windows in Cuba:

• Notes and Communication records
• Correspondence received
• Income details
• current assessment details
• External Information window
• details recorded
• previous decisions related to a change of assessment
• Objections Actions History Window Help
• Administrative Review Tribunal

Assess the customer’s financial circumstances using the Transactional Search Facility (TSF), Integrated Core Processing (ICP) and Corporate Applications. See ATO Applications Manual link in Resources

Analyse the personal and business financials if customers:

• are sole traders
• have a link to an active company, trust or partnership

Search for indicators of:

• personal benefit
• additional income
• income minimisation
• income splitting
• alienation of income

If research shows the current assessment does not reflect the customers current financial assets, income or resources the case may be referred to CTP.

Level 2 searches such as MASCOT or property ownership may be necessary in limited circumstances.

Note: Third party searches (s161) do not form part of the scrutiny process.

The External searches guide lists a number of sites and resources for searches.

Using Google or other internet searches can help highlight current trading or online sales. E.g., a car may be listed under phone numbers not a name.

Specialised searches are not required at this stage unless other Cuba or ATO search results indicate it is necessary to do so before talking to the customers.

Suspicious Matter Reports (SMR) from AUSTRAC must never be disclosed. They must not be included when making a submission. These reports cannot be disclosed in any court or tribunal and are not admissible as evidence.

Review AUSTRAC search results to make sure it does not contain an SMR or Suspected Transaction Report (SUSTR). These reports must not be recorded on the system. If found on a record the information needs to be removed, take immediate action by sending an email to the National Intensive Collection Services.

To upload the search results:

• use the Document Upload Request macro to upload external search results into Cuba.
• note in the Payer Collection/Capacity to Pay window that the results are available in View Correspondence.
• save any documents that cannot be stored in Cuba as a pdf document. Save in an electronic file in the CTP folder in the NTD drive under the relevant year.

See COA Electronic File Management for naming conventions and the searches to save. See the Resources page for more details.

The Financial Investigator uses the evidence to establish prima facie for an R8 COA application. This includes indicative income or annual rates for the COA Decision Maker to consider.

All decisions are recorded on Cuba and in the CTP database using the Case Management Tool (CMT).

Has the referral been accepted for CTP review?

• Yes, see Table 3
• No, see Table 2

If a decision is made at the end of the scrutiny process to not continue with the review, the reasons must be clearly documented.

For FDV referrals customer contact is compulsory prior to finalisation.

Is the review an FDV referral?

• Yes, go to Step 2
• No, go to Step 3

When the decision is made that an FDV referral case will not continue, customer contact must be done before finalisation.

Make an outbound contact attempt on each available number. If unsuccessful document in the customers Communication window.

Note: detailed documentation supports staff to explain why the referral was not accepted for review if the customer calls back.

Clearly document:

• all call attempts
• the reasons for not accepting the referral for progression

Go to Step 3.

To code a case as not suitable for review the Financial Investigator must:

• use the subject line CTP Referral – review not required
• summarise the reasons for the recommendation in the Cuba Details window
• update the CTP tool with category ‘review not required'
• delete the referral intray

Procedure ends here.

The Financial Investigator creates a CTP decision required intray that matches the referral category.

Note: regular customer contact must be maintained throughout the investigation whenever possible. The customer may be able to clarify any questions about new information.

If phone contact is not possible, document reasons in the Capacity to Pay window, e.g., when the customer is overseas or incarcerated.

For incarcerated referral customers:

• contact is not needed if the payer is incarcerated and the initial review of income determines a reduction to minimum annual rate (MAR) is likely
• contact must be attempted with the payee

Is there an identified FDV concern?

• Yes, go to Step 2
• No, go to Step 3

Once the case is accepted for CTP review both customers must be contacted within 2 business days. This is to discuss the CTP process and request information for the investigation.

Customer Contact - identified FDV concerns

To contact the customer in line with identified FDV concerns the Financial Investigator must:

• check any party to a CTP review to determine the FDV concerns have been raised
• only lock the parent disclosing the FDV concerns
• review the indicators and consider the circumstances of both customers to determine if a pre call SMS is appropriate before making a call attempt
• make 3 outbound contact attempts on each of the available numbers over 2 business days
• send a UQ2.05 – Capacity to Pay Family and Domestic Violence Indicator – Both parents. This gives the customer 10 business days to respond if phone contact attempts are unsuccessful

Was contact successful?

• Yes, the Financial Investigator explains the referral process and if customer agrees to continue, enter the case on the CTP tool as per the CTP Access database case management tool task card on the Resources page

If the person has valid concerns that proceeding with the CTP will escalate the situation, finalise the review No Further Action - FDV

• No, finalise the review No Further Action – FDV. Leave notes on the CTP Finalisation window of the identified customer

When preparing to call the customer:

• use the customer discussion planner to plan specific questions regarding the customers’ financial situation
• review the initial call planner section of the Capacity To Pay (CTP) tool suite macro for suitable prompts to structure the call
• review both customers' files before sending a pre call SMS
• if appropriate send a pre-call SMS notification. Use S001 – Pre call alert SMS notification message, ‘A Services Australia Service Officer will call you (within the hour/today) from a private number. Please answer this call. Do not reply by SMS'

Contact both customers:

• Make 3 outbound contact attempts on each available number over 2 business days
• Undertake minimum collection activity, see Customer Management Approach (CMA) for Child Support

Financial Investigators can speak to a customer’s representative to explain the CTP process.

Note: if the review leads to a COA application Child Support Legislation prohibits customers from being represented during a COA process.

FDV concerns raised during the call

If either customer informs of a family and domestic violence issue, consider the impact a CTP investigation may have for the customers. Financial Investigators should talk to their team leader about how to manage the case. See Family and domestic violence for more information.

The customer can:

• complete the Statement of financial details (CS4644) form over the phone
• be offered an email in real time via the secure mailbox if they cannot complete the form over the phone. To set up secure email contact see Table 4
• receive the Statement of financial details by post

Tell the customer:

• to provide the supporting evidence within 7 days via Child Support online account or fax.
• they will be sent an S010 SMS in two days as a reminder to provide the requested information. 'Please send requested documents by (dd/mm) or we will use the information we have to make a decision. Upload documents online. Do not reply to SMS'
• Child Support may need to contact them to discuss the information provided
• the CTP process has a 28 day timeframe. This timeframe may be increased if the customer:
• cannot be contacted by phone
• chooses to receive the Statement of Financial Circumstances by post. The postal allowance adds 30 days to the review taking the maximum time to 58 days

The potential outcomes include:

• administrative remedy
• both customers jointly electing to withdraw from the CTP process
• a determination to cease the CTP investigation and not take any action
• referring the case to COA

Note: tell the customers about the change of assessment process although the CTP process only relates to initiating applications under reason 8A, the Decision Maker (DM) may also consider other Change of assessment in special circumstances.

There are no objection rights to a CTP review as there has been no decision. Once COA accepts a recommendation, any resulting decisions do have objection rights.

Any later Part 6A objection decision also has objection rights and the matter may be reviewed by the ART.

Explain how open exchange of information (OEI) relates to the CTP process:

• The OEI does not apply to correspondence or information gathered prior to a case being referred to COA
• Once a case is referred for a COA or a customer lodges an objection to a COA decision, ‘OEI’ procedures apply
• If a Part 6A objection decision is reviewed by the Administrative Review Tribunal (ART), all correspondence and information (even if it was received prior to a case being referred to COA) are subject to open exchange of information
• For more information, see Open exchange of information for Child Support customers

Ask the customer to provide:

• relevant financial information identified through the customer discussion planner
• any other information that would give a clearer picture of their financial circumstances

Use the information from the initial investigation phase to guide the conversation.

Tell the customer if the case if referred for COA the Decision Maker may need to send section 161 notices to external parties to request the financial information. If the customer has not provided the requested information, any information obtained through a legal notice during the COA becomes part of the file that is provided if an appeal to the ART is lodged.

Note: do not offer to request information from third parties where customers can reasonably be expected to obtain it themselves.

If the payer is incarcerated, advise the payee:

• the agency has information that the assessment is inaccurate and the payer is no longer/was not earning an income
• they will receive a letter summarising the details used in the recommendation
• if the payee has no information to indicate financial resources or higher capacity to pay, a COA application will be made by the Registrar to reduce the assessment

Note: do not send the CTP introductory letter or Statement of financial details to incarcerated referral customers where the payer is incarcerated or has been released and is only in receipt of Centrelink benefits.

If the phone contact is unsuccessful the Financial Investigator must:

• Paste the UQ2.00 – Reviewing your Child Support assessment – both parents letter (CTP introductory letter) text into an MX 0-1 Unique letter for both customers, see Letters Cuba Process Help
• Print the letter locally
• Attach the Statement of Financial Details (CS4644) form and the Capacity to pay reviews fact sheet. See the Resources page for a link to the form and fact sheet
• Send the letter to the appropriate customer

To document the call:

• in the Capacity To Pay (CTP) tool suite macro select the Create document for Cuba button at the end of the Initial call section. This generates a document
• paste the completed document as a note in the Capacity to Pay window

Create the following intrays for both customers. See Intray management Cuba Process Help:

• CTP1 Cust RICA Follow Up Call intray - a manual reminder is set to contact the customers by SMS after 7 days to check:
• the Statement of Financial Details form was received
• that the customer will be responding within 7 days
• CTP SFD Follow Up intray as a reminder to check that the customers have responded

Go to Table 5

If the customer has agreed to the secure email service.

There is a discussion template to give customers the information for them to make an informed decision and use the service effectively.

Ask the customer:

‘So you can view the information as quickly as possible, would you like to receive the correspondence through our secure email service?’

If the answer is:

• Yes, go to step 2
• No, if the customer chooses to receive the Statement of Financial Circumstances by post. The postal allowance adds 30 days to the review taking the maximum time to 58 days. Go to Step 6

Read to the customer:

'To ensure the security of your information, we are required to use an encrypted email service, we use PGP. When I send you the correspondence, it will initially require you to establish a passphrase but don’t worry, it has clear instructions.

Once registered, you can use this account to view any future communications we issue to you. Information on the PGP account is only accessible for 30 days and is limited to 30mb. To ensure your account is ready for any future exchanges of information, we encourage you to save the information to the cloud or your computer, then delete the email from PGP. This will ensure its ready to go.

The legislative timeframes for you to respond have not changed. Please don’t reply using the PGP service, as this email is not monitored. You won’t see a change in the way you currently receive letters, assessment notices and decisions'.

Then ask the customer 'Can we send the email to the address we have on the system?'

• Yes, go to Step 3
• No, go to Step 4

Spell the email address out to the customer to confirm it is correct.

Go to Step 5

If the customer wishes to use a different address:

• record this email in the customer profile
• ask if the customer's email address can be updated on the system

Document the record with using the following template

• Cuba Subject Header: Agreement to send/receive correspondence by email
• In the document:
• [customer's name] has accepted the offer to have the correspondence from this process exchanged by secure email and understands the following:
• The correspondence is sent through the encrypted messaging service – PGP
• They will be required to establish a PGP account password
• Services Australia will continue to send letters, assessment notices and decisions through their previously established communication method, e.g., online through myGov, surface mail
• They are not to respond directly to the email messaging service. Customers are encouraged to use myGov and the Express Plus child support App
• The agreement to use secure email is only for this application process
• The email address has been confirmed and aligns with Cuba or customer provided a different email address and this has been recorded in the customer profile

Document the record with the following information

• Cuba subject header: Declined offer for email correspondence
• Document the following:
• [Customer name] has declined the offer to exchange correspondence for this process through the secure PGP messaging service
• customer has indicated this is because [write the reason the customer cannot participate]
• advised customer that any information they provide may be exchanged by the agency with the other parent through the most efficient means available, which could include secure email

Continue with discussion about the review process and potential outcomes from continuing with the CTP review.

Go to Table 3 Step 6

Where there has not been successful contact with either customer in initial attempts, consider relevant DVA indicators before issuing an SMS.

To send the reminder use the Evidence requested SMS

S010 - 'Please send requested documents by [dd/mm] or we will use information we have to make a decision. Upload documents online. Do not reply to SMS.'

Refer to Child Support Electronic Messaging (EM)

Can an Evidence requested SMS be sent?

• Yes, go to Step 3
• No, go to Step 2

If it is not suitable to send the Evidence requested SMS (S010) make one call attempt on each available number.

Use the following Pre call Alert SMS where possible:

• S001 - 'A Services Australia Service Officer will call you in the next hour/today from a private number. Please answer this call.'

When speaking to the customer

• ask if the response will be sent within the agreed timeframe
• promote the use of myGov to reduce mail handling and postage delays

After the initial correspondence has been received customer contact is necessary to:

• clarify the details are accurate
• give customer an opportunity to provide more information
• advise of potential outcomes
• follow up on previously discussed administrative remedy

Make one outbound contact attempt on all available numbers after sending Pre Call Alert SMS S001.

Document all conversations and information in the Capacity to Pay window, see Documenting Child support information.

To determine the customer's financial capacity, all information is assessed. The potential outcomes are:

• the customer’s financial resources are substantially different to their adjusted taxable income
• the customer’s financial resources are fairly represented in the assessment
• there is a potential administrative remedy that can be undertaken

A recommendation to change the assessment cannot be made based on a customer’s capacity to earn. The assessment only relates to the customer’s actual financial resources. See:

• Calculating financial capacity for business owners
• Child Support Guide 2.6.6: Registrar-initiated change of assessment
• Child Support Guide 2.6.14: Reason 8 - a parent’s income, property, financial resources, or earning capacity
• the References page for links to the legislation

Discuss with a team leader or a Program Support Manager if help is needed:

• analysing the information and evidence
• determining if the customers have higher financial resources than what is reflected in the assessment

Where possible, record the gathered information using the CTP tool suite macro. Generate pages to document the analysis in the Capacity to Pay window, see Documenting Child Support information.

Where it is not possible to record the information in Cuba, see COA Electronic File Management. A link is located on the Resources page.

When additional phone contact is required and there are no specific indicators or presenting issues, make one outbound contact attempt on all available numbers for each customer.

Additional contact may be needed to:

• confirm the information received and check it is accurate
• advise of the potential outcomes that may be recommended
• give them the opportunity to provide further information
• follow up on earlier discussions, e.g., if the customers had indicated they were considering an administrative remedy

Document all conversations and information in the Capacity to Pay window, see Documenting Child support information.

Make the CTP recommendation once all the financial information has been gathered, analysed and clarified with the customers.

The recommendation will form the basis for the CTP report.

There may be a joint election to stop the review

• If the payee is not receiving any income tested pensions, benefits or allowances the customers may lodge a ‘joint election’ to cease the CTP process at any time. This is an administrative process and not legislative until after the S98Ms have been issued
• If both parties wish to cease the review after the S98Ms have been issued, a Joint Election to Withdraw can be made directly to the Change of Assessment Decision Maker under S98P(1)
• The customers’ election to withdraw can be lodged over the telephone or by using the Joint election to stop a change to your Child Support Assessment being initiated (CS2899) form. See the Resources page for a link. If a joint election is received, check if the payee is in receipt of the income tested pension benefit or allowance
• If the payee is not in receipt of these benefits, the election must be accepted. If the payee is in receipt of these benefits, the election must be rejected, Send the COA17-2 to both clients – Joint election to discontinue RICA has been rejected letter to both customers

Where an administrative remedy will reflect the customer’s true financial capacity, this is the most desirable outcome. Administrative remedies include:

• correcting incomes, see Income processing for Child Support customers
• child support agreements, see Agreements between Child Support customers
• estimate reviews or reconciliations, see Child support estimates review (post 1 July 2010) or Child support estimates - Reconcile (from 1 July 2011)
• the payee electing to end the assessment, see Ending a Child Support assessment

Where the customers’ assessment needs to be amended, record the change in Cuba by following the relevant procedural instruction.

The Financial Investigator:

• can recommend a non-change of assessment. This is done after reviewing all the evidence. This can happen when a customer does not participate in the process or cannot give more details
• may assess both customers' income, assets and financial resources and find the current assessment to be fair. If the Financial Investigator has considered all the details, they may recommend No Further Action

For information to consider when making a recommendation, see:

• Calculating financial capacity for business owners
• The Child Support Guide 2.6.6: Registrar – initiated change of assessment and the Child Support Guide 2.6.14: Reason 8 – a parent’s income, property, financial resources, or earning capacity, see the References page
• The Child Support formula calculator, to determine the results of variations of the formula assessment

When drafting a recommendation use the CTP Recommendation template, located on the Resources page

Note: remember that certain sections of the recommendation will be copied and pasted into the customers’ S98M letters and the same sections will be sent to both customers.

To request a peer review of the CTP recommendation:

• mail a peer reviewer of a copy of the CTP recommendation
• add a notepad to the Client Profile window as follows:
• Subject Peer review
• Notepad CTP recommendation peer review requested

The peer reviewer checks the Financial Investigators pending CTP recommendation and makes sure:

• the findings support the outcome
• there are no obvious unintended or unforeseen consequences caused by the outcome
• there are no errors of expression
• the customer and case details are correct
• there are no typographical errors

Once complete, update the notepad in the Client Profile window by:

• documenting ‘review completed’
• emailing the Financial Investigator

Once the peer reviewed copy has been received, the Financial Investigator will correct any identified issues.

When the final draft is approved:

• Finalise the report in the Capacity to Pay window
• Add a note stating the report has been saved in the COA maintenance window
• Change the status in the CAPCITY TO PAY – CTP Finalisation dialogue box to Finalised

The S98M letters must be issued to both parties. Choose the relevant letter:

• UQ2.02 - S98M Considering a change to your assessment - Payer letter
• UQ2.01 - S98M Considering a change to your assessment - Payee letter, and
• UQ2.04 – S98M Considering a change to your assessment (Recommendation to review Minimum Annual Rate or below) - Both parents

Once the correct letter is selected, edit the letter with:

• customer and case specific information – follow the instructions as outlined in ‘red’ and delete the instructions before sending the letters
• a summary of relevant information consisting of the ‘Conclusion’ and ‘Other reasons’ sections of the CTP report in Cuba. The same summary must be sent to both parties (the customer specific information will be different)

Special guidelines must be followed when completing the report and drafting the letters. The same summary will be provided to both parties. Make sure:

• the facts of the investigation have been verified with the customers through the CTP process wherever possible
• to provide enough detail that lets both customers respond to the recommendation and take part in the change of assessment process
• to not include personal opinions or assumptions
• to not include the names of third-party individuals unless necessary. Where possible, list the third parties by how they relate to the customer. E.g., ‘the customer's accountant’
• to only include necessary details. It is not necessary to protect the names of companies, trusts and business structures, but there may not be a need to include these in the conclusion

Once the draft has been completed:

• copy and paste the main body of the document into a unique letter for both customers, see Letters Cuba Process Help
• obtain approval for the letters from the team leader
• email the team leader with the details of the customers to be reviewed
• correct any issues identified by the review
• print the letters locally and attach the Response Form - We are considering changing your Child Support Assessment (CS2898), a link is located on the Resources page
• send the letters

To finalise the file the Financial Investigator must make sure:

• all information, documents and conversations are recorded in the Capacity to Pay window
• any information that cannot be stored in Cuba, is stored electronically in the shared drive. For information about appropriate file storage and file naming conventions see CTP electronic file management attachment on the Resources page

To refer a case to COA:

• Record the change of assessment registrar application in the COA Maintenance window
• Create a note in the COA Maintenance window referring to the CTP investigation and the electronic file
• include the location in the share drive, see Documentation Cuba Process Help
• create a note with the title CTP Report & Recommendation Centrelink, Incarcerated or BAU (where applicable)
• paste the report into the notepad
• Route the Application In Progress intray to:
• Office: NATIONAL OFFICE
• Stream/Team: SP NAT COA ALLOCATIONS
• Position: B – CTP REFERRALS
• Route the Initial Contact Required and Awaiting DM Allocation intrays to:
• Office: NATIONAL OFFICE
• Stream/Team: SP NAT COA ALLOCATIONS
• Position: ZZZ - ACCESS POINT

Note: follow steps 1 - 8 of Table 1 the Assessments Cuba Process Help - Record a new COA application.

Do not unlock the customers. Once a Decision Maker has been assigned, the case will be locked to the National COA team.

An outbound phone contact is required when:

• the customer is adversely impacted by the decision
• a customer has requested post decision contact
• minimum collection action is needed to address any arrears or overpayment created because of the decision

The contact attempt is made the day after the review has been finalised. This is done by:

• making 2 contact attempts on each available number across the day to advise of the outcome
• using Pre Call Alert SMS when making attempts:
• ⦁ S001 – A Services Australia Service Officer will call you in the next hour/today from a private number. Please answer this call

Document the details of the contact in Capacity to Pay window for the relevant customer

Finalise the report by changing the status in the CAPACITY TO PAY – CTP Finalisation dialogue box in the Capacity to Pay window to Finalised.

If a joint election to cease the review has been accepted:

• paste the UQ2.03 - Withdraw from change of Assessment accepted - both letter (JER acceptance letter text) into an MX0-1 - Unique letter for each customer to communicate the decision
• see Letters Cuba Process Help and Letters for Child Support customers

If the outcome is recorded as ‘no further action’, and phone contact is unsuccessful’ issue the UQ2.06 - Capacity to Pay No Further Action - No telephone contact.