Managing Child Support customer Debt Enforcement referrals 277-04220050

Service Officers forward debt enforcement referrals using a Client Transfer Request intray, see Customer referral guidelines, Possible litigation referral.

Conduct a bankruptcy search when the referral is received.

If the customer is listed as bankrupt:

• save the result in the Collection window in the notepad where the Debt Enforcement referral macro is recorded, and
• upload to the View Correspondence window using the Document upload request macro
• reject the referral if the customer is bankrupt, go to Step 3

If the customer is not listed as bankrupt:

• save the bankruptcy search result in the Collection window
• upload to the View Correspondence window using the Document upload request macro
• create a folder in the customer’s name using the format Surname, First name in the Debt Enforcement shared drive R:\NSW\PARR-130-George\CSA\DEBT ENFORCEMENT\National Workload Management\New South Wales\Case Files\- A – (folders are specific to the customer’s location by State and surname from A-Z)
• copy the search result into the customer’s folder on the Debt Enforcement share drive
• conduct any other searches that are necessary to supplement or clarify the basis of the referral, see the External searches guide
• check the referral meets the Customer referral guidelines for Child Support staff, and
• check the referral meets the evidence requirements

Accept the referral if:

• it meets the customer referral guidelines
• it meets the evidence requirements, and
• the customer is not bankrupt

Is the referral rejected?

• Yes, go to Step 3
• No, the referral is accepted, go to Step 4

To reject the referral:

• update the Client Transfer Request intray notepad advising the reasons the referral was rejected, see the Intray management Cuba Process Help
• route the Client Transfer Request intray to the referring Service Officer, see the Intray management Cuba Process Help
• select ‘Rejected’ in the Referral to Debt Enforcement in the Collection window, and
• email the referring Service Officer, their Team Leader and their Service Manager to advise the referral has been rejected and the reasons why

If the referral is rejected, procedure ends here.

To accept the referral:

• update the Client Transfer Request intray notepad confirming the referral has been accepted, see the Intray management Cuba Process Help. This action finalises the intray
• select Accepted in the Referral to Litigation in the Collection window, and
• add the Special Contact Detail ‘MANAGED IN DEBT ENFORCEMENT’ in the Client Profile window

Review the debt to ensure it is accurate. Consider:

• the basis of the assessment
• the incomes used in the assessment for all relevant parties
• use of the estimates of income. If an estimate reconciliation is required refer to the Specialist Estimates Team for action, see Child support estimates (post 1 July 2010)

Determine if the case is ‘general’ or ‘complex’.

General cases are those where:

• assets are owned solely by the customer who owes the debt, or
• there is only 1 business entity

These cases are allocated to a Debt Enforcement Service Officer.

See the Transfer or lock a customer Cuba Process Help to lock the customer to:

Region: NEW SOUTH WALES AND ACT

Office: PARRAMATTA OFFICE

Stream/Team: NO SLI2LTT PAR TM 1

Position: NONE

Complex cases are those where:

• multiple business entities and structures are intertwined in a way that makes it difficult to establish a clear link to the customer who owes the debt, or
• there is a potential equitable interest which requires significant investigation

These cases are referred directly to a Debt Enforcement SO5 determined by the state in which the customer resides. The Debt Enforcement Team Leader arranges for the case to be reviewed within 5 working days and will allocate to a Debt Enforcement if suitable.

Discuss with the Team Leader:

• any cases where the category ‘general’ or ‘complex’ is not clear
• how many ‘general’ cases to allocate to each Debt Enforcement SO3/4 (taking into account their current caseload)

Allocate cases to Debt Enforcement Officers on a weekly basis:

• create a Collection Activity Lit 120 Days intray, see the Intray management Cuba Process Help
• email the CSRN of the allocated case/s to the Debt Enforcement Officer and their Team Leader
• lock the customer to the Debt Enforcement Officer, see the Transfer or lock a customer Cuba Process Help

Procedure ends here for the Debt Enforcement Gateway Officer.

Review the case before contacting the customers to:

• become familiar with the individual circumstances
• determine appropriate options, and
• formulate a strategy for case progression

Review all historical communication with both the customers of the case. Consider:

• the reason(s) for the customer’s non-compliance
• any issues and disputes raised by the customer
• any threats against or concerns regarding the safety of individuals involved in the case, see Family and domestic violence

Review the debt to ensure it is accurate. Consider:

• the basis of the assessment
• the incomes used in the assessment for all relevant parties
• use of estimates of income. If an estimate reconciliation is required refer to the Specialist Estimates Team for action, see Customer referral guidelines for Child Support staff, Estimates

Review the reason the case was referred for possible debt enforcement. Determine:

• the types of searches to be performed and evidence required to establish capacity, see the External searches guide
• if sufficient evidence is currently available to assess the customer’s capacity. Note: seek Team Leader assistance if uncertain whether the evidence available sufficiently demonstrates the customer’s capacity to pay the debt
• if any administrative collection avenues are available

Contact both customers within 5 days of allocation to provide information about the escalation of the case and the possibility of legal enforcement, see Contact with Child Support customers. If the customer address in Cuba is invalid, go to Customer location (Tracing).

Do not provide legal advice. Encourage customers to obtain independent legal advice. Information provided to the customers during contact may be included in the brief of evidence and the affidavit provided to the court and all parties to the proceeding.

Document all contact, including attempted contact, in a comprehensive and professional manner, see Documenting Child Support information in Cuba.

Contact the other party and use the collection and debt macro to guide and document the discussion. Continue to make contact attempts if initial attempts are unsuccessful and a ‘please contact’ letter is issued.

Advise the customer:

• the case is being investigated for suitable collection options
• the case has been escalated for potential litigation action
• about the process of negotiations leading up to the Letter of Demand
• of realistic timeframes and manage expectations to reduce the need to regularly contact Services Australia
• ongoing updates will be provided as information becomes available

Discuss with the customer:

• any safety concerns if the agency proceeds with debt enforcement, such as history of family and domestic violence. See Family and domestic violence
• default or estimate incomes, see Income processing for Child Support customers. Request lodgement of outstanding tax returns and advise future corrections may result in a change to the assessment
• to confirm disbursement details in the Disbursement Detail window
• where appropriate, provide Social worker and other service referrals for child support customers

If a family violence concern is identified, determine if the customer still wishes to pursue collection of the debt. Provide the options of seeking an exemption from Centrelink, see Exemptions from seeking child support for Family Tax Benefit (FTB) customers or opting out and/or discharge of arrears, see Collecting child support payments privately and/or discharging arrears. If the debt is an overpayment discuss the option of not recovering the overpayment. See the Contacting the payer about payee overpayment table of Information for payers about child support overpayments.

Do not engage in any bartering or negotiations between the parties. Do not discuss with the other party:

• specific details of the Letter of Demand or engagement of legal representatives
• detailed information regarding possible legal proceedings
• the content of conversations held with the customer who owes the debt or their legal representative
• the customer’s late payment penalties or court costs

Document the discussion in the Collection window.

Use the collection and debt macro to guide and document contact with the customer.

Engage in direct and specific dialogue with regard to identified assets and financial resources, in line with the Assertive Debt Conversations approach and Debt repayment.

Advise the customer who owes the debt:

• the case has been escalated to the Debt Enforcement Team due to the outstanding debt
• to lodge tax returns where there are default or estimate incomes, see Income processing for Child Support customers. Request lodgement of outstanding tax returns and advise future corrections may result in a change to the assessment
• they are required to pay their debt in accordance with their capacity to pay
• to review their circumstances and to make payment of their child support debt or overpayment a priority
• payment in full is required. If refused, explore reasons why and clearly outline options and consequences
• it is recommended they seek financial and legal advice
• that the agency will continue to investigate their capacity to pay the debt and determine an appropriate time frame for repayment

Go to Step 5.

While on the call:

• identify any issues in dispute and the reason for the customer’s failure to pay
• provide options to assist the customer to take the necessary action including:
• paying the outstanding debt
• lodging an estimate
• making a Change of Assessment application
• objecting to a previous Change of Assessment decision
• making an extension of time application to lodge an objection
• appealing an objection decision to the Administrative Review Tribunal (ART)
• seeking leave from a court that deals with family law matters to depart from the assessment for a period over 18 months
• seeking a stay order
• if paternity is a relevant issue, advise the steps required to obtain a s107 order including the need to seek court approved DNA testing
• provide Social worker and other service referrals for child support customers where appropriate

It is critical that all commitments made by the Debt Enforcement Officer or the customer are accompanied by strict timeframes and clear consequences for non-compliance.

Document all discussion points, including any timeframes and consequences discussed, in the Collection window.

If the customer:

• has made a voluntary payment arrangement
• has employer withholding arrears (EWA) in place
• is paying instalments by way of a section 72A notice, or
• offers to make a payment arrangement
• go to Step 6

If the customer refuses to pay, see the Investigate capacity (Debt Enforcement Officer) table.

If the customer’s existing payment arrangement or offer of a new payment arrangement is in accordance with their capacity to pay the debt, finalise the case. See Debt repayment.

To finalise for debt enforcement purposes:

• advise the customer their case is no longer being considered for debt enforcement and they should continue to meet their payment arrangement
• document the customer contact and the reasons for finalising the case, and
• unlock the customers

The Collection Activity Lit 120 Days intray automatically deletes after a payment is received.

If the existing payment arrangement does not meet the requirements of Debt repayment or the customer has a higher capacity to pay and they refuse to make a new arrangement that meets these requirements:

• advise the customer the agency:
• has evidence to suggest they have a greater capacity to pay
• will continue to investigate options for debt enforcement
• encourage the customer to continue to address the debt

Note: payments received by customers under the National Disability Insurance Scheme (NDIS) or the National Redress Scheme are not considered a financial resource when determining a customer's income or capacity to repay their debt. See The National Disability Insurance Scheme (NDIS) and National Redress Scheme.

Do not remove the current payment arrangement. A Debt Enforcement SO5 will review the arrangement. See Debt Enforcement referrals.

See the Investigate capacity - (Debt Enforcement Service Officer) table.

If, after making a minimum of 3 contact attempts using all available numbers over 48 hours, the customer is not able to be contacted, issue the UQ12.00 Pre litigation warning Child Support Debt.

The purpose of the letter is to place the customer on notice that the agency intends to initiate legal proceedings if a suitable arrangement cannot be negotiated.

After the issuing of the Pre-Litigation letter, during the next 14 day period (before the expiry of the Pre-Litigation warning letter) make 6 attempts to contact the customer on all available numbers.

If the customer has not been contacted, there have been a total of 9 contact attempts over 16 days. Document all contact attempts in the Collection window.

If the customer:

• makes contact, go to Step 3
• fails to make contact during this period, see Table 4

To determine the customer’s capacity to pay the debt:

• conduct relevant searches, and
• assess the customer’s capacity based on the available evidence

Conduct all relevant Level 1 and Level 2 searches and issue all relevant notices, see the External searches guide.

If the customer appears to have capacity to pay the debt (not restricted to having an asset only) focus on the most appropriate evidence category to establish equity/capacity and perform any additional searches that have not yet been completed.

Issue notices to known financial institutions, employers, councils (rates notices), organisations initiating caveats or writs, accountants, etc.

Document in the Collection window:

• details of all searches
• notices issued
• follow up action taken
• response to notices

See Documenting Child Support information in Cuba. Record the search results in the View Correspondence window.

Save a PDF version of each search and the response in the Debt Enforcement share drive. Name the documents as Year-Month-Date – customer surname – search type or name, for example 2014-03-21 – Smith – Property Search.

During this process, continue to actively identify any potential administrative avenues for collection and explore prior to progressing the matter to a Debt Enforcement SO5.

Note: in certain circumstances a suitable administrative collection option may be available, such as employer withholding, and capacity to pay for debt enforcement purposes may also been established. Exercise judgment in these circumstances and make a decision about which is the most appropriate collection strategy. Consider the costs associated with litigation weighed up against the delay which may be associated with pursuing a periodic administrative collection option. Discuss with a Team Leader if uncertain.

Review the information gathered. Determine if capacity is established and if an administrative collection opportunity is available. Based on Service Officer’s assessment:

• take administrative action, go to Step 5
• complete non-pursuit of debt, go to Step 6
• refer the case out, go to Step 7, or
• make a last chance call, go to Step 8

If a suitable administrative collection option is identified, see Debt repayment, take appropriate action to resolve the debt including referral for Departure Prohibition Order.

Document the decision and transfer the case in line with Customer referral guidelines for Child Support staff.

Complete the Non-pursuit of individual and employer debt macro if:

• capacity to pay the debt cannot be established
• no administrative collection option is identified, and
• payments have not been received

See Non-pursuit of individual child support debts. On approval of NPOD complete documentation and transfer the case in line with Finalisation guidelines for Child Support staff.

Prepare a Submission to transfer case from Debt Enforcement if:

• the case is deemed not appropriate for debt enforcement
• a non-pursuit of debt does not apply, and
• there are no administrative options

Document the reasons for referral including why the case is no longer suitable to be managed in Debt Enforcement.

Email the submission to the Debt Enforcement Program Support Manager and copy in Team Leader.

On acceptance of the submission, the Debt Enforcement Program Support Manager will save the submission in the Customer Transfer window following the Finalisation guidelines for Child Support staff.

Note: non-pursuit does not apply to overpayments. The overpayment debt will remain on the customer’s record.

If the case is suitable to proceed to litigation, contact the customer to provide a final opportunity to avoid this enforcement and address their debt, see Contact with Child Support customers.

Advise the customer:

• based on the information and evidence available their capacity to pay the debt has been established
• failure to address the debt will result in a Letter of Demand being sent
• this is their last opportunity to make a payment arrangement based on their capacity before legal enforcement is commenced

While on the call:

• request payment from the customer including a good will payment, see the Assertive Debt Conversations approach
• encourage settlement of the debt without the need to progress to court
• explore issues raised by the customer and provide realistic options such as:
• Change of assessment
• Objections
• ART
• Non Agency payment (NAP)

Prepare the matter for a Letter of Demand (LOD) if:

• the customer’s capacity to pay the debt is established
• payment is not able to be negotiated
• a suitable administrative collection option is not identified
• legal enforcement is the most appropriate option to recover the outstanding child support or overpayment, and
• the agency intends to initiate legal proceedings if the customer fails to comply with the demand for payment

Note: it is not appropriate to utilise a LOD as a scare tactic or to prompt the customer to take further action.

Review the case for any retrospective debt variations and ensure the appropriate amount of late payment penalties (LPPs) have been cancelled in relation to the variation, see Penalties for child support debts.

Prepare a LOD submission:

• record as ‘Information Gathering’ in the Collection window with:
• ‘Method’ as phone, and
• ‘Outcome’ as other
• create a Client Transfer Request intray, and
• route the intray to your Team Leader

Note: seek Team Leader assistance if uncertain of the specific details required for the LOD.

Review the case to determine the suitability and overall quality of the LOD submission, including a review of:

• all incomes to ensure they have been reviewed and updated (including estimate reconciliations where possible)
• the observations noted in the case review
• other information contained in Cuba and the Debt Enforcement share drive
• the reliability of the intended LOD address, especially where this address carries from the address recorded on the customer’s Cuba record

Record the results in the LOD submission in the Collection window, summarising the results under the following categories:

• Customer Contact
• Income
• Assessment
• Capacity
• Searches
• Administrative Options considered

If the Debt Enforcement Gateway Officer identifies an issue with the LOD submission they will email the Debt Enforcement Officer and copy in the Team Leader. The Team Leader makes a decision to refuse or accept the LOD submission.

Is the submission refused?

• Yes, go to Step 4
• No, the submission is accepted. Go to Step 5

If a LOD is refused, the Team Leader will:

• record the decision to refuse the LOD in the LOD submission notepad on the Collection window, including:
• the identified issues, and
• further action required
• route the Client Transfer Request intray back to the referring officer for action, see the Intray management Cuba Process Help

If a LOD is appropriate the Team Leader will:

• record ‘LOD approved’ in the LOD Submission in ‘Information Gathering’ in the Collection window
• route the Client Transfer Request intray back to the referring officer advising them to create a ‘Level 3 Referral to AGS Letter of Demand’ in the Collection window
• complete the required information for referral to the Legal Service Provider (LSP) in the LOD spreadsheet for this week, located in the Debt Enforcement share drive folder ‘All Office Data/NSW/PARR-130-George/CSA/Debt Enforcement/Legal Transition/Letter of Demand/Instructions to AGS/'Year'/'Year-month'/File name’

Once the Team Leader has approved the LOD submission:

• record the LOD details, see Debt Enforcement Cuba Process Help
• upload the LOD in PDF format to the View Correspondence window using the Document upload request macro, and
• delete the Client Transfer Request intray

The LOD provides the customer a period of 14 days in which to pay the total child support debt or overpayment or to contact the agency to make a suitable arrangement.

The LSP emails the Team Leader when the LOD has been issued and provides a PDF copy of the LOD. The Team Leader forwards this email to the Debt Enforcement Officer.

The Debt Enforcement Officer saves a copy of the PDF in the customer file in the Debt Enforcement shared drive.

Fourteen days after the LOD is issued the Debt Enforcement Service Officer checks there are no outstanding issues on the case

• Debt Enforcement SO5, continues to manage customer per Debt Enforcement referrals
• Debt Enforcement SO3/4, advises their Team Leader the case is ready for transfer to a Debt Enforcement SO5 and moves the electronic file to the ‘Litigation Allocation’ folder

The Debt Enforcement Team Leader:

• documents the transfer in the Customer transfer window
• locks the case to the relevant Debt Enforcement SO5 team’s NONE position, see the Intray management Cuba Process Help
• emails the Debt Enforcement SO5’s Team Leader confirming the case is ready for allocation

For litigation processes, see Debt Enforcement referrals.