Centrelink deductions used to collect child support debts 277-04070000

Centrelink Income Support Payments (ISP) deductions

Centrelink deductions come from pensions and benefits.

See Child Support Guide 5.2.5: Collection from social security pensions and benefits.

Centrelink deductions can collect:

• ongoing liability under the Assessment Act
• child support or child maintenance arrears under the Assessment Act
• a child maintenance order or an overseas maintenance liability (amounts that were not paid when they fell due and payable)
• arrears of spousal maintenance under an overseas maintenance liability
• carer debt (overpayments)
• outstanding debt under a s143 recovery order that is registered for collection
• Debts to consolidated revenue under s30 of the CSRC Act; however, system limitation prevents this. Consider alternative collection.

Centrelink deductions cannot collect:

• penalties
• costs
• fines, or
• spousal maintenance arising under Australian law (specifically excluded by subsection 72AA(4))

ABSTUDY

Centrelink deductions or a garnishee notice (s72A) cannot collect ABSTUDY payments.

Consider alternative collection methods.

Family Tax Benefit (FTB)

Centrelink deductions cannot collect Family Tax Benefit payments.

See Recovering a child support debt from a Family Tax Benefit (FTB) to collect from FTB.

The advantages of Centrelink deductions are:

• Payment is prompt - they are sent daily
• Automatic suspension period:
• If the customer no longer receives a pension or benefit the deduction is active but suspended for 2 weeks
• If the pension or benefit resumes in this period the deduction resumes
• If the pension or benefit does not resume, the deduction request will stop automatically
• If the customer moves from a pension or benefit to another, the deduction automatically transfers to the new pension or benefit
• The deduction stops automatically once the child support (maintenance) debt is paid

Section 20 of the Child Support (Registration and Collection) Regulations 2018 sets the allowable deduction amount from an ISP per week. See the References page for a link to the Regulations.

If the Child Support Period commenced in 2023, this amount is 3 times the minimum weekly rate of $9.45 per week, or $28.35 per week.

2023 minimum annual rate of child support is $493 / 365.25 days = $1.34976 daily rate.

$1.34976 daily rate x 7 days = $9.44832 rounded to $9.45 per week.

$9.45 per week x 3 = $28.35

This increases periodically for inflation.

See the Basic Values for the relevant year to determine the deduction amount.

ISP customers with overdue child support will automatically have 3 times the minimum weekly rate of child support deducted.

ISP customers having difficulty meeting life costs can request a concession, if assessed to pay less than 3 times the minimum annual rate. See Income Support Payment (ISP) concession for Centrelink deductions.

Centrelink deductions also come from PLP, which is not an ISP.

See Child Support Guide 5.2.10 Collection from parental leave payments.

Centrelink PLP deductions are under different legislative than ISP deductions.

Therefore, Child Support can collect different PLP amounts and debt types.

PLP deductions can be used to collect from payers:

• an ongoing liability arising out of a child support assessment, a court order, a court registered maintenance agreement, or collection agency maintenance liability
• ongoing liabilities arising under a spousal maintenance order or overseas maintenance liabilities
• who have an outstanding debt under a recovery order that is registered for collection
• of child support debts that were not paid when they fell due and payable, or
• of a carer debt (overpayment) due to the Commonwealth under CSRC Act section 69B.
• consolidated revenue debt

PLP deductions cannot be used to collect:

• penalties (late or estimate)
• costs, or
• fines

From 1 July 2023, for child support deductions from PPL to occur:

• a claimant must be payable for some or all PPL days for a child born or adopted on or after 1 July 2023 and Services Australia is the paymaster
• the claimant has a child support liability/debt or overpayment, and
• the pattern of PPL days is 10 out of 14 days (which need not be consecutive or Monday -Friday)

Arrears payments of PPL will not have child support deductions applied.

PPL is paid at the National Minimum Wage for up to:

• 18 weeks (90 payable days) for a child born or adopted before 1 July 2023
• 20 weeks (100 payable days) for a child born or adopted on or after 1 July 2023

The rate of Parental Leave Pay is indexed each financial year. See Rate of Parental Leave Pay (PPL) and Dad and Partner Pay (DAP) for details.

From 01 July 2022, the maximum PLP gross amount is $812.45 a week, which indexes each financial year.

The maximum Centrelink deduction is the PLP maximum gross amount minus the Protected Earnings Amount (PEA). See Basic Values for the relevant year's PEA.

Centrelink may make other deductions, for example tax from PLP, which could affect the deduction amount.

Centrelink will not deduct the PLP instalment if it is less than the PEA. If customers receive a Centrelink ISP and commence Centrelink PLP, deductions are available for both.

If customers receive PLP from their employer, see Employer Withholdings (linking) for Child Support customers.

Note: A PLP deduction amount is adjustable.

Customers adjusting their overdue child support Centrelink or employer PLP deductions can negotiate a payment arrangement, if their ongoing liability is less than the amount Child Support can collect from Centrelink. See Debt repayment and Centrelink Deductions Cuba Process Help.

Centrelink deduction requests automatically for most customers according to certain rules.

Manual deduction requests require an officer to use Cuba to send the request to Centrelink. For:

• Automatic Centrelink deductions and how to stop them, see Table 2
• Manually starting or stopping Centrelink deductions, see Table 3
• Actioning Centrelink Deduction intrays, see Table 4
• Resolving general problems with Centrelink deductions, see Table 5

Cuba and Centrelink exchange information to establish automatic deductions from customer Centrelink benefits.

Automatic Centrelink deductions commence for customers who meet one of the following:

• case has an ongoing liability
• has a child support debt of at least $25
• has no debt offset in any case
• owes an overpayment of at least $25
• is in receipt of certain Centrelink benefits or Parental Leave Payment (PLP) (Cuba will seek to collect 100% of any PLP entitlement)
• does/does not have a Special Recovery Condition of hardship, stay order, or customer agreement, (a special recovery condition will only prevent disbursement, not collection) and the case has an ongoing liability or arrears registered for collection

Note:

• For Child Support arrears, automatic deductions commence 7 days after the amount becomes due
• For overpayments, automatic deductions commence 21 days after the overpayment is created

Automatic PLP deductions commence at the maximum if the:

• ongoing liability is equal to or higher than the maximum deduction amount, or
• ongoing liability is less than the maximum deduction amount, but the customer has arrears which makes their account balance more than the maximum deduction amount

To amend Centrelink deductions, see Centrelink Deductions Cuba Process Help.

PLP and Centrelink benefits can deduct at the same time.

It may be appropriate to prevent automatic deductions because of the customer’s circumstances, for example due to an agreement with the customer.

Record a special recovery condition to prevent automatic deduction

In the Special Recovery Condition window select:

• Reason - hardship, stay order, or client agreement
• Finalisation date - based on the reason for preventing automatic deductions
• If automatic deductions should never be established for the customer, key a finalisation date of 31/12/4000
• See TRIP Cuba Process Help - Record a special recovery condition

Centrelink Deductions will automatically stop when the:

• child support liability and/or arrears has been paid
• customer has stopped receiving a Centrelink pension, benefit or PLP

This generates a Centrelink Deduction Terminated intray.

To check the end reason, see Centrelink Deductions Window Help.

If unable to determine why the payment ended, check Cuba and Customer First documents to confirm.

To resolve problems with automatic Centrelink deductions, see Table 4 or Table 5.

Where:

• debt remains and pension or benefit ceased
• debt has been paid and other debt remains. For example, penalties

Consider alternative collection avenues:

• employment - EW or s72a
• Protected Earnings Amount (PEA) affecting EW - s72a
• undeclared income - s120 to bank to identify a possible EW or s72a source
• support from family and friends

Also, if incarcerated or deceased see Customer Referral Guidelines.

Contact the customer, establish their circumstances and negotiate payment. See Contact with Child Support customer and Debt repayment.

Sometimes Centrelink ISP or PLP manual deductions are required.

Manual deductions are appropriate when a:

• Liability raised, not yet due and the customer requests deductions commence
• Automatic deductions were prevented
• Payee with an overpayment requests deductions
• Payee with an overpayment does not have automatic deductions due to a debt offset in one of their cases. Note: manual deductions can still be set up in this scenario

About Centrelink deductions outlines conditions to establish Centrelink or PLP deductions.

See the Client Benefits window on how to check which benefit or pension (if any) the customer receives.

Review the case to ensure that Centrelink or PLP deductions are appropriate:

• The debt must be correct if possible
• Contact the Debt Enforcement Service Officer if enforcement litigation is occurring, to discuss the proposed deduction

Check them and associated customers for changes that may alter the liability. Consider these issues carefully before proceeding.

Check the debt is correct by considering:

• Eligibility screen changing the liability/entitlement
• Change in care
• Opt out and/or discharge of arrears
• Reconciled customers
• Role reversal
• Debt offset
• Terminating event
• Non-recoverable overpayment
• Decide pending NAP/s covering the total arrears before commencing Centrelink or PLP deductions. See Non-agency payment (NAP)
• If the liability is set by:
• An assessment - ensure accurate incomes where possible. See Income Processing for Child Support customers
• An agreement - check for clauses (unemployment etc.) affecting the liability. See Agreements between Child Support customers
• If the liability is set by a court order that overrides an assessment - check for clauses (unemployment etc.) affecting the liability. See Court Varied Assessments (CVA) including lump sum orders
• If there is an order clause that has not been actioned. See Stage 1-variations to activate the clause
• If there is no unemployment clause in the order, check if the customer may be able to apply for a low-income non-enforcement (LINE) period. Contact the customer if a LINE is not in place and they are eligible. See Stage 1- low-income non-enforcement period

Check for a current payment arrangement on the Customer and Payment Arrangement windows. See Payment arrangements Cuba Process Help on how to access these screens.

If so, and the payment arrangement is less than the maximum allowed, only request Centrelink deductions following negotiation with the customer. See Contact with Child Support customer and Debt repayment.

Where legal action/litigation is in progress, contact the Debt Enforcement Service Officer managing the issue to determine if Centrelink Deductions are appropriate.

Customer contact attempts must occur before enforcement action. See Contact with Child Support customer.

Check if the customer needs an income, estimate or care update.
See Income Processing for Child Support customers
See Child support estimates (Post 1 July 2010)
See Notification of change in child support care from 1 July 2018 (15 May 2019 for WA Ex-nuptial cases)

Advise the customer:

• of other possible payment methods, and making a payment arrangement
• if voluntary payments aren’t received, collection action will commence
• deductions can be made from certain Centrelink benefits and PLP
• deductions continue until the debt is paid, and
• only Child Support can start or stop deductions (Centrelink does not make this decision)

Note: customers can make a payment arrangement for Centrelink PLP collection. See Debt repayment.

If phone contact is unsuccessful, issue a MX1-1 Request for Client to contact CSA letter.

Use the appropriate text:

• 'ask Centrelink to deduct {key amount} each fortnight from your social security pension or benefit. Please call Child Support to discuss other payment options' or
• 'ask Centrelink to deduct {key amount} each fortnight from your Paid Parental Leave entitlement. Please call Child Support to discuss other payment options'

Commencing Centrelink or PLP deductions requires the same enforcement considerations:

• Customer contacted to discuss payments
• Customer had the opportunity to pay voluntarily
• Centrelink or PLP deduction is the most appropriate collection method

To start manual Centrelink deductions, see Table 1 in Centrelink Deductions Cuba Process Help.

Document the decision in the Payment Options notepad.

It may be appropriate to end manual Centrelink or PLP deductions, including when the customer:

• gains employment whilst still in receipt of a benefit or pension, to enable linking
• becomes able to make a payment arrangement
• is in hardship (where only arrears are being collected)

See Centrelink Deductions Cuba Process Help.

Two intrays generate from the Centrelink deduction process:

• Centrelink Deduction Rejected intray, go to Step 2, and
• Centrelink Deduction Terminated intray, go to Step 5

See Intray Management Cuba Process Help to manage intrays in Cuba.

A Centrelink Deduction Rejected intray generates when the request is rejected by Centrelink because the customer:

• name or Date of Birth (DOB) details do not match, go to Step 3
• is not currently receiving Parental Leave Payment (PLP) or is not on a social security pension or benefit

Where:

• debt remains and pension or benefit ceased
• debt has been paid and other debt remains, for example, penalties.

Consider alternative collection avenues:

• employment - EW or s72a
• Protected Earnings Amount (PEA) affecting EW - s72a
• undeclared income - s120 to bank to identify a possible EW or s72a source
• support from family and friends

Also, if incarcerated or deceased, see Customer Referral Guidelines.

Contact the customer, establish their circumstances and negotiate payment.
See Contact with Child Support customer and Debt repayment.

A deduction request may be rejected if 1 or more of the following does not exactly match on Centrelink and Child Support records:

• customer name
• date of birth
• customer reference number

This may be the result of

• a keying error
• a slight variation in spelling, for example 'Stephen' rather than 'Steven', or
• the result of the customer changing their details with Centrelink or Child Support, but not the other

Sometimes, this is because 2 different customers incorrectly matched or multiple records.

Carefully investigate all instances. Do not delete the intray until the issue is resolved.

To resolve mismatches:

Do not change or delete the CRN, DOB, TFN or legal name. This ensures current data remains available for corrective action.

Check:

• Cuba documentation and correspondence of the customer’s original application to ensure their CRN was keyed in the Individual Customer Details Window at the time of registration
• Individual Customer Details History dialogue box for previous name and address
• Other Details History dialogue box for CRN, DOB, TFN, OSID and phone details
• External Information Window for updates. Select the CNLK Refresh button (takes 3 days)
• Customer First > Customer Summary for Name, CRN, DOB
• Customer First > Customer Summary > Benefit Status for:
• Receiving an ISP or PLP shows as (mnemonic)/CUR. See Resources table for all Pensions and Benefits
• Zero rate shows as (mnemonic)/CZR
• Parental leave pay shows PPL/CUR
• Customer First relevant screens:
• Allowance Benefit History (ABH) to see when they started receiving their ISP
• Pensions Status History (PNSH) to see when they started receiving a pension
• Payment Summary (PS) to confirm they have been receiving an ISP during the relevant period. In ‘Display payments for’ change to ‘all’. ‘Number of months in past’ defaults to 1. Typing S and pressing ‘Enter’ will open it and identify the type, amount and timeframe of payment.
• Customer First screen ‘CSA Customer ID Changes’:
• Type ‘CCC’ to find the current CSA ID Number CIN
  Note the current and deleted CIN.
  When a Child Support record creates, so does a CIN. Matching CINs is critical for data exchange. Different CINs means the data exchange can’t match the intended record.
  Intertwined records (2 or more different customers) current and/or deleted CIN may not match the Pluto CIN
• Use Pluto to find a customer’s CIN under their ‘Identification’ icon.
  Pluto does not support a CIN search function.
  Cuba’s CIN is only viewable with special access.
• Cuba for duplicate records if the CF ‘CCC’ screen shows current and deleted CIN.
  This ensures identification of the duplicate record for isolation, if not already completed, and a possible CIN reassignment
• ATO systems for their name/s, CRN, DOB, TFN and contact details
• If they are a child of a case, their parents or carers’ External Information Window Child data for the child CRN. Use 01/01/1970 as the starting search date to capture available data
• Customer contact may be required to confirm their details
  See Customer Location (Tracing) for confirming current customer details

These steps should indicate correct or incorrect details. Document information found.

Service Support Officer. Same for If Centrelink data mismatch results from use of an alias due to family violence.

If the mismatch cannot be resolved after taking all possible action, prevent automatic deductions.

Note: the reason will be Hardship and the end date is 31/12/4000.

A Solutions Gateway Team (SGT) referral is appropriate to consider the issue.

Incarcerated and newly deceased customers require specialist management.
See Customer Referral Guidelines.

A Centrelink Deduction Terminated intray is generated when:

• an active deduction arrangement has ceased because the debt has been paid
• an active deduction arrangement has ceased because the customer has stopped receiving PLP or a pension or benefit that can be deducted from, or

Where:

• debt remains and pension or benefit ceased
• debt has been paid and other debt remains e.g. penalties

Consider alternative collection avenues:

• employment - EW or s72a
• Protected Earnings Amount (PEA) affecting EW - s72a
• undeclared income - s120 to bank to identify a possible EW or s72a source
• support from family and friends

Also, if incarcerated or deceased see Customer Referral Guidelines.

Contact the customer, establish their circumstances and negotiate payment. See Contact with Child Support customer and Debt repayment.

Delete the intray when the issue is resolved.

Centrelink deductions automatically stop Payer Account Statements issuing when the balance is less than $20.

If a customer requests their statement, change the statement function frequency to Always. See Payment Options Window Help.

Note: Overpaid customers are sent a monthly overpayment summary.

• Client Benefits does not show the customer's benefit status- no records found or records inaccurate
• Deduction status showing as Ended but customer states deductions still occurring
• Request Status Unconfirmed for more than 1 week
• Request appears active but no payments received
• Deduction request rejected - New (but a current instruction exists)
• Deduction request rejected - customer not current on requested system

Do not change or delete the CRN, DOB, TFN or legal name. This ensures current data remains available for corrective action. Document the relevant details appropriately.

Check:

• Cuba documentation and correspondence of the customer’s original application to ensure their CRN was keyed in the Individual Customer Details Window at the time of registration
• Individual Customer Details History dialogue box for previous name and address
• Other Details History dialogue box for CRN, DOB, TFN, OSID and phone details
• External Information Window for updates. Select the CNLK Refresh button (takes 3 days)
• Customer First > Customer Summary for Name, CRN, DOB
• Customer First > Customer Summary > Benefit Status for:
• Receiving an ISP or PLP shows as (mnemonic)/CUR. See Resources for all Pensions and Benefits
• Zero rate shows as (mnemonic)/CZR
• Parental leave pay shows PPL/CUR
• Customer First relevant screens:
• Allowance Benefit History (ABH) to see when they started receiving their ISP
• Pensions Status History (PNSH) to see when they started receiving a pension
• Payment Summary (PS) to confirm they have been receiving an ISP during the relevant period. In ‘Display payments for’ change to ‘all’. ‘Number of months in past’ defaults to 1. Typing S and pressing ‘Enter’ will open it and identify the type, amount and timeframe of payment
• Customer First screen ‘CSA Customer ID Changes':
• Type ‘CCC’ to find the current CSA ID Number CIN. Note the current and deleted CIN
  When a Child Support record creates, so does a CIN. Matching CINs is critical for data exchange. Different CINs means the data exchange can’t match the intended record
  Intertwined records (2 or more different customers) current and/or deleted CIN may not match the Pluto CIN
• Use Pluto to find a customer’s CIN under their ‘Identification’ icon.
  Pluto does not support a CIN search function.
  Cuba’s CIN is only viewable with special access
• Cuba for duplicate records if the CF ‘CCC’ screen shows current and deleted CIN.
  This ensures identification of the duplicate record for isolation, if not already completed, and a possible CIN reassignment
• ATO systems for their name/s, CRN, DOB, TFN and contact details
• If they are a child of a case, their parents or carers’ External Information Window Child data for the child CRN. Use 01/01/1970 as the starting search date to capture available data
• Customer contact may be required to confirm their details.
  See Customer Location (Tracing) for confirming current customer details

These steps should indicate correct or incorrect details. Document information found.

Escalate the findings to an aligned Service Support Officer. Same for data mismatch results from use of an alias due to family violence.

If a mismatch cannot be resolved after taking all possible action, prevent automatic deductions.

Note: the reason will be Hardship and the end date is 31/12/4000.

A Solutions Gateway Team (SGT) referral is appropriate to consider the issue.

Generally, this occurs when an amended deduction amount keyed.

Adjust the amended deduction amount to match the allocated amount. This will allow Centrelink Deductions to re-commence.