The Guides to Social Policy Law is a collection of publications designed to assist decision makers administering social policy law. The information contained in this publication is intended only as a guide to social security payments. The information is accurate as at the date listed at the bottom of the page, but may be subject to change. To discuss individual circumstances please contact Services Australia.

3.4.5 Suspension for unemployment (low-income non-enforcement period)

Context

The payer of certain enforceable maintenance liabilities can apply to the Registrar to suspend enforcement of the amounts payable for the period that the payer is receiving a social security pension or benefit. The enforceable maintenance liabilities for which a payer can apply for suspension of enforcement are:

  • court orders or court registered agreements for child maintenance, and
  • maintenance orders made by, or maintenance agreements registered by, a judicial authority of a reciprocating jurisdiction.

Act references

CSRC Act section 17(1), section 37B, section 113A

CSRC Regs section 17

On this page

There is an option for the payer to apply to the Registrar to suspend enforcement of periodic amounts of maintenance payable under these liabilities, during a period in which they receive a social security pension or benefit (CSRC Act section 37B(2)).

What are the requirements for making an application?

A payer of a registered maintenance liability to which section 37B applies can make an application to suspend enforcement of their liability if they have claimed, or already receive, a social security pension or benefit (CSRC Act section 37B(2)). An application may be made in relation to a past period, from when the payer commenced receiving a social security pension or benefit. A payer may therefore be able to make an application where the ongoing liability has ended and there are arrears owing.

A payer cannot make an application if their court order or court registered agreement provides for the amounts payable to reduce, directly or indirectly, when they are unemployed or their income is substantially reduced (CSRC Act section 37B(3)).

When will the Registrar accept an application?

The Registrar will accept a payer's application if they:

  • meet the requirements for making an application, and
  • satisfy the prescribed income test for the next social security payment after they make their application.

The Registrar will confirm with the Secretary that the payer receives a social security pension or benefit, and whether they satisfy the prescribed income test.

If the Registrar accepts the payer's application it will start a low-income non-enforcement period.

What is the prescribed income test?

The payer will satisfy the prescribed income test if the total amount of income they receive from social security pensions or benefits and other ordinary income is less than the maximum basic rate of pension payable (CSRC Regs section 17).

When does a low-income non-enforcement period begin?

The low-income non-enforcement period is a period during which no periodic amounts of maintenance will accrue as a debt due to the Registrar. It begins on the day that the payer made their application, or an earlier date decided by the Registrar (CSRC Act section 37B(4)). The low-income non-enforcement period cannot begin:

  • before the payer commences to receive a social security pension or benefit
  • after the day the payer lodged the application.

The Registrar will start a low-income non-enforcement period on the earliest day possible. The start date of the low-income non-enforcement period may be the date the applicant first began receiving the benefit they are receiving at the time of their application. A low-income non-enforcement period cannot be backdated to the beginning of a previous period when the applicant was in receipt of a benefit. The low-income non-enforcement period must be continuous.

However, the Registrar will not start the low-income non-enforcement period from a date that would create an overpayment for the payee. If the payer applies during a period when they satisfy the prescribed income test and they have already paid maintenance for some of this period, the Registrar will start the low-income non-enforcement period on the earliest day for which no maintenance was paid.

The payer is not liable to pay amounts to the Registrar for days in the low-income non-enforcement period. The payee, however, can institute their own proceedings to recover these amounts (5.4.7) during the low-income non-enforcement period (CSRC Act sections 37B(7A) and 113A).

Example: A payer (Konstantinos) has been unemployed since 24 February 2013. Konstantinos has been receiving a social security benefit since 5 March 2013. No maintenance payments have been made since that time. On 25 August 2013, Konstantinos makes an application for a low-income non-enforcement period. Konstantinos's court order does not have any provision for payments to be reduced during periods of unemployment. Konstantinos satisfies the prescribed income test. The low-income non-enforcement period will begin on 5 March 2013.

When does a low-income non-enforcement period end?

The low-income non-enforcement period ends at the earliest of the following times:

  • when the payer stops receiving a social security pension or benefit
  • when the payer does not satisfy the prescribed income test, or
  • when the liability ends.

The Registrar will review the payer's benefit or pension status periodically to ensure that they continue to meet the prescribed income test.

Frequently asked questions

Can the Registrar suspend enforcement of spousal maintenance when the payer is unemployed?

No, unless it is a spousal maintenance order made by, or a spousal maintenance agreement registered by, a judicial authority of a reciprocating jurisdiction.

The payer is unemployed, but does not receive a social security benefit as their new partner is employed. Can they apply for a low-income non-enforcement period?

No. The liability is suspended when the payer receives a social security pension or benefit. A payer cannot apply for a low-income non-enforcement period unless they receive a pension or benefit. The payer would need to make an application to the court to have the order varied.

The Registrar has accepted the payer's application for a low-income non-enforcement period. The payee believes that the payer has the capacity to pay the liability. What options are available to the payee?

The payee can object to the decision to suspend the liability. If the objection is not successful, the payee may apply to the AAT for a review of the objection decision if they are dissatisfied with the outcome of the objection (CSRC Act section 87(3)). Alternatively the payee could apply to the court to have the court order varied to specify an amount to be payable when the payer is in receipt of a benefit.

What happens when a payer who has a low-income non-enforcement period failed to satisfy the prescribed income test some time ago, but is still receiving a social security pension or benefit?

The Registrar can determine multiple low-income non-enforcement periods during any period that the payer is continuously receiving a social security pension or benefit. The Registrar will end the low-income non-enforcement period from the date the payer failed to satisfy the prescribed income test and start another low-income non-enforcement period from the date the payer next satisfied the prescribed income test.

Can a payer apply for a low-income non-enforcement period for a period when they were previously in receipt of a social security benefit?

No. A payer must be in receipt of, or have claimed a social security pension or benefit, on the day that they apply for a low-income non-enforcement period. The Registrar can determine a commencement day for the low-income non-enforcement period that is earlier than the date of the payer's application, but it cannot be before the date the payer commenced to receive a social security pension or benefit on the later occasion. If the payer failed to apply for a low-income non-enforcement period during previous periods of unemployment, they can seek a variation to their court order for that period.

Can the Registrar continue to collect arrears of child support during a low-income non-enforcement period?

Yes. The payer is not required to pay child support in relation to the days in the low-income non-enforcement period, but they are still liable to pay child support in relation to the days before the low-income non-enforcement period. The Registrar can take enforcement action for arrears, including action to have deductions made from the payer's social security pension or benefit (5.2.5).

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