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File number: 2017/SC011866

Tribunal: Member William Kennedy

On 2 January 2018 the Administrative Appeals Tribunal made a decision to vary the rate of child support payable by the applicant.

Mr Vardy and Mrs Wilmot are the separated parents of two children for whom Mr Vardy pays an annual rate of child support. Mrs Wilmot applied to the Department of Human Services to increase the rate. The rate of child support payable is usually based on an assessment under Part 5 of the Child Support (Assessment) Act 1989 (the Act). This requires the application of a statutory formula which takes into account various factors. Mrs Wilmot asked for a departure from this formula assessment to take into account alternative factors not included in the statutory formula. These were the special needs of one of the children and the cost of their education and training.

A delegate of the Child Support Registrar allowed the application and increased the rate. Mr Vardy objected to this decision stating the children have no special needs and that there was an agreement between the parents that they would equally split the cost of education. A Departmental objections officer partly allowed the objection and further varied the rate of child support payable. Mr Vardy requested a review of this decision by the Administrative Appeals Tribunal.

In order to depart from the assessment formula under Part 5, the Tribunal had to consider Section 98C of the Act. This broadly required a consideration of whether one or both of the grounds for departure from the formula provided by Mrs Wilmot would significantly affect the costs of maintaining the children. The Tribunal also needed to consider whether a departure was just and equitable.

The Tribunal found that the costs of maintaining the children was significantly affected by the education and training expected by the parents but not by the special needs of the children. This is because the tuition fees of the school the parents expected to send their children to were especially high. However, while one child did have some special needs, the Tribunal found they can mostly be addressed by the school he attends and therefore the agreed expenses may be met by the parents through the formula assessment.

In considering whether a departure was just and equitable the Tribunal examined the existing agreement between the parents as to how the children’s school fees would be met. There was insufficient evidence before the Tribunal to conclude that any agreement existed. The Tribunal also had to consider the financial resources of the parents which found Mr Vardy derived 73.7% of the total parental income. The Tribunal found that it would be appropriate for Mr Vardy to pay that percentage of the tuition fees.

Based on the special circumstances of the children in relation to the cost of education, the tribunal decided to depart from the assessment formula by increasing Mr Vardy’s assessment to take into account the tuition fees charged and estimated to be charged by the school.