Entitlement Method 277-51080050

The Entitlement Method is used to estimate annual maintenance income received from a person if the customer collects the maintenance income:

• privately or
• via Child Support where the customer has not asked for the Disbursement Method to be used, or under the Modified Entitlement Method comparison the Entitlement Method results in a higher estimate than the Disbursement Method estimate

Under the Entitlement Method, Centrelink assumes customers will receive their full child support entitlement.

When a child/case end is transferred by Child Support for a Child Support Collect customer on the Disbursement method, the system retrospectively changes the case to Private Collect and applies the full maintenance entitlement amount.

This retrospective change in assessment results in the customer having their annualised maintenance income assessed under the Entitlement Method. In the majority of cases, this will result in a decrease in the customer’s ongoing rate of FTB Part A. This change in annualised maintenance income can also invoke Mandatory Continuous Adjustment, causing a further reduction to the customer’s ongoing rate of FTB.

Note: this is not caused by incorrectly entered/ended case data or a system problem. However, it can lead to an unintended and unexpected reduction to the customer’s ongoing rate. Occurrences of this issue must be reported to the Level 2 Policy Helpdesk for escalation to the Policy (Advice) Assessment Team for a workaround to be considered. See the Resources page for a link.

If a customer's child support entitlement changes during the financial year, annual maintenance income is recalculated so that each entitlement amount is apportioned for the period it applies in the financial year. Current child support entitlement is assumed to continue to the end of the financial year.

Maintenance income is estimated in this way to reduce the risk of a debt being calculated during the FTB reconciliation process. If a projected overpayment is identified, the customer's ongoing rate may be reduced by the mandatory continuous adjustment calculation.

A change in annual maintenance income may affect the customer's FTB Part A rate no earlier than the date paid to plus one day.

Details of maintenance income assessment can be viewed from the MIT Explanation Summary (MNEX) screen.

If FTB is granted for a past period, all changes in the customer's child support entitlement will be taken into account in working out the annual maintenance income that applies over the period.

Annual maintenance income is recalculated based on child support entitlement for private collection periods plus any Child Support disbursements received during the financial year.

Maintenance reconciliation may result in an adjustment to the customer's FTB Part A rate if annual maintenance income is different to maintenance income estimated during the financial year. Any adjustment of FTB at reconciliation depends on income reconciliation and other family circumstances.

Customers with a child support case registered for collection by Child Support may benefit from the Maintenance Income Credit during FTB reconciliation.