Part 1 I Performance reporting External performance reporting framework

Operating environment statement

While lone-parent families are increasing as a proportion of families with children under 15, most families with children under 15 are two-parent families (around 78 per cent in 2003). In 2003, 2.5 per cent of all families with children under 15 were headed by lone fathers while 19.3 per cent were single mother families. Although cohabitation is increasing, marriage remains the dominant pathway to child-bearing (in 2002, around 69 per cent of mothers who registered a birth were married).

However, the proportion of households made up of a couple with dependent children is decreasing— with the proportions of lone-parent families, couple-only families and single-person households increasing. There are a number of factors contributing to these trends, including structural ageing of the population, the increasing trend of childlessness, longer-term decline in marriage rates and high levels of divorce, separation and relationship instability. Also, the number of blended families and shared-care arrangements for children of separated and divorced parents is increasing.

An emerging issue of concern is the number of children living in jobless families.

Between 1980 and 2004, the number of jobless families increased from 11.6 per cent of families with children to 16.2 per cent of families with children. In 2004 there were 823 700 dependent children living in jobless families—around 16.4 per cent of all dependent children. Of these, 34 per cent were living in couple families and 66 per cent were living with one parent.

There was a two per cent increase in marriages between 2001 and 2002, but against the backdrop of a 10 per cent decrease since 1982. In 2002, marriage rates for the unmarried population were 31 per 1000 unmarried men and 28 per 1000 unmarried women, down from 35 and 32 respectively in 2000. The likelihood of marriages ending in divorce is 32 per cent (based on 1997-99 first marriage rates). In 2001, around half of all divorces involved families with children under 18 years, and 53 400 children under 18 years of age were in families where parents divorced.

Australia’s population is ageing and people are having fewer children later in life. In 2002, Australia’s total fertility rate (TFR) was 1.75 babies per woman. Since 1998, Australia’s TFR has stood between 1.73 and 1.76, down from 1.89 in 1992. Around a quarter of Australian women are now likely to remain childless. Women are having fewer children and those that do generally have them when they are older. The median age of all mothers who gave birth in 2002 was 30.2 years (for fathers the median age at fatherhood was 32.5 years). This shows a steady increase, with the median age of mothers the highest ever recorded. The median age of mothers registering the first birth of their current marriage was 30.1 years. Women giving birth outside a registered marriage were approximately five years younger, the median age being 26.5 years. In comparison with other developed countries, Australia’s TFR sits among the middle-ranked nations. There are notable differences in fertility rates and age of parents at birth within the Australian population. In 2002, the TFR for Indigenous women was 2.19 babies per woman. Fertility is higher for women who live in non-metropolitan areas and TFRs also vary among women according to country of birth. For example, women from China, Vietnam and the Philippines have TFRs of over 2.0 babies per woman.

Roles within families continue to change, especially as women (notably mothers) continue to participate in the paid workforce. In 2003, 56 per cent of women aged 15-65 were in the labour force, making up 44.4 per cent of the total labour force. Many families combine family and work yet women still do most of the caring and other unpaid domestic work. In many cases, families have accessed the growth of part-time and casual employment to help meet family and work commitments. Women in particular often combine child caring responsibilities with part-time paid work. The likelihood of working and the number of hours worked increase as the youngest child ages, and particularly once children reach school age. At the 2001 Census, 30 per cent of sole mothers and over 50 per cent of partnered mothers with a youngest child aged two were in paid work. Of mothers whose youngest child was aged six years, 46 per cent of sole mothers and 65 per cent of partnered mothers were in paid work. Around 62 per cent of women with children (15 years and under) worked part-time.

Over the last two decades there has been an increase in the amount of, and the demand for, workplace arrangements to assist workers with family responsibilities. In 1999, 53 per cent of families with children under 12 years of age, and with at least one parent employed, used family-friendly provisions to care for their children, with mothers more likely than fathers to use family-friendly work arrangements.

Demand for child care is growing. Between 1984 and 1999, the proportion of all children in formal care doubled (from 12 to 24 per cent). Over 540 000 families currently receive Child Care Benefit. In September 2003, there were over 763 000 children using formal, Australian Government-approved child care services.

An area of concern is the increase in child protection notifications and the numbers of children placed in out-of-home care. In 2002-03 there were 12 819 children admitted to out-of-home care across Australia, a slight decrease from the previous year but a continuation of an upward trend. This figure represents only those placements where the state or territory makes a financial payment and does not include unpaid care by relatives. There are no reliable national data on the number of children who are the subject of a child protection order. There are also no national data available on the reasons why children are placed in out-of-home care. Of the children in out-of-home care, most (92 per cent) were in home-based care: 51 per cent were in foster care, 40 per cent in relative/kinship care, and 1 per cent were in some other kind of home-based care. There were generally higher rates of Indigenous children in out-of-home care than was the case for other Australian children.

At June 2003, it is estimated that there were 2 753 623 young people aged 15 to 24 years of age in Australia-just over 300 000 more than in June 2002. Aboriginal and Torres Strait Islander young people constitute about 3 per cent of this total youth population. Approximately 70 per cent of young people live in major cities, and the rest in either inner regional or outer regional and remote areas.

In 2003, the labour market participation rate was 59.5 per cent for young people between 15 and 19 years old, and 81.4 per cent for those between 20 and 24 years old. In 2003, of all those aged between 15 and 19 years old, 4.6 per cent were unemployed and looking for full-time work. For those aged between 20 and 24, this figure was 6 per cent. Both of these figures represented a slight decrease in comparison with 2002. The most notable feature of the working arrangements of young people in recent years has been the increasing proportion of young people working part-time. This trend can be explained by the increased participation rates in education and a growing tendency of combining education and work.

In 2003, the apparent retention rate of full-time school students from Year 7 or 8 to Year 12 was 75.4 per cent compared with 75.1 per cent in 2002. As in previous years, the apparent retention rate for females (80.7 per cent) was significantly higher than the rate for males (70.3 per cent).

Young people are staying in education and living with their parents longer, while delaying marriage or cohabitation and child-bearing. The proportion of those aged 25 to 34 living with their parents increased by 1.2 per cent in the last decade, to 11.9 per cent in 2003. However, the proportion of those aged 20 to 24 living with their parents was 45.1 per cent in 2003, declining by one per cent for the same period.

The majority of young Australians are in good mental and physical health and happy with their lives.1

1. Australia’s Young People: Their Health and Wellbeing. Australian Institute of Health and Welfare, 2003

Social justice and equity impact

Performance highlights and policy outlook

Key achievements included:

continuing to deliver support to families through Family Tax Benefit ($12.9 billion), Child Care Benefit ($1.4 billion) and Child Care Support Program ($190 million)

consulting extensively on the development of the National Agenda for Early Childhood

implementing a range of Early Childhood Initiatives under the first phase of the Stronger Families and Communities Strategy (2000-04)

redesigning the Stronger Families and Communities Strategy with a stronger focus on early childhood development for four additional years of funding (2004-08), and initiating prompt implementation processes

developing the National Plan for Foster Children, Young People and Their Carers with state and territory governments

participating in and providing advice to the Work and Family Taskforce, convened by the Department of the Prime Minister and Cabinet

delivering major initiatives included in the More Help for Families package announced in May 2004, including around $2 billion in payments to families in June 2004, a new $3000 Maternity Payment from July 2004, improved work incentives and an ongoing annual supplement of $600 per child

sponsoring Families Australia for their conference, Globalisation, Families and Work-Meeting the Policy Challenges of the Next Two Decades, and for National Families Week 2004

delivering lasting improvements in the skills and capacities of families and communities in disadvantaged areas through the success of the community-based approach, identifying good examples for other communities to draw on, and establishing a genuine and effective partnership between government, the community sector, academia and business

implementing the Government’s response to the Family Law Pathways Advisory Group’s recommendations, including support for the Family Law Pathways Taskforce’s role in developing a coordinated approach to the implementation of policies and programs for separating families and families in conflict

reviewing the Family Relationships Services Program (FRSP), involving providers and customers. Reviews were released, and considered at a national forum of the program, in June 2004, and are currently being used to inform strategic program development.

contributing to the House of Representatives Standing Committee on Family and Community Affairs Inquiry into Child Custody Arrangements in the Event of Family Separation through a number of written submissions, as well as through evidence at hearings of the committee, and contributing to the development of the Government’s response

hosting the ‘Creating Common Wealth’-Youth Enterprise Development Forum in November 2003. The forum provided the opportunity for business, government, community and young people to come together to share information, exchange ideas, identify strategies and develop plans of action for young people from the Commonwealth of Nations to create their own sustainable livelihoods. Forty-five Commonwealth countries were represented.

publishing a resource kit— Above and Beyond: Recognising Youth Development in Australia—to help community organisations recognise the skills and achievements that young people gain through their involvement in youth development activities

releasing the final report on the evaluation of the Reconnect program, which found that Reconnect as an early intervention program has been effective in reducing the risk of youth homelessness

consulting extensively during 2003 with the youth sector and interested stakeholders to develop a new Job Placement, Employment and Training (JPET) program selection process and needs analysis. The new selection process commenced in September 2003 and applications closed on 15 January 2004. The outcomes of the process were announced on 14 April 2004.

providing increased support to families—as of 1 January 2004, an additional $79.5 million over four years provided for 10 000 additional outside school hours care places, 2500 family day care places and additional playgroups

redeveloping the Child Care Support Program. The successful redevelopment has been largely due to the enormous contribution to the consultations by child care services, families and individuals with an interest in child care. The new Child Care Support Program was launched in June 2004. Its clear objectives and principles will ensure resources are used efficiently to benefit families and children. An increase of $25 million in funding brings the total funding for the program to $226 million for 2004-05.

by 30 June 2004, approximately 1.3 million parents had registered with the Child Support Agency (CSA), resulting in child support payments of over $2.1 billion for the benefit of some 1.1 million children

CSA has had significant success in helping parents manage their own arrangements, with almost 52 per cent of parents now paying privately; 70 per cent of newly separated parents elect to pay their child support privately

during 2003-04 CSA reversed a previous five-year trend of rising gross maintenance debt levels by successfully reducing domestic debt by $13 million. In particular, extra resources provided to target ‘hard debt’ have resulted in an increase of $19.3 million in child support collections.

CSA has significantly improved both parents’ (payer and payee) levels of satisfaction as measured by its annual Professionalism Survey and the national feedback program. This is also reflected in reduced child support complaints.

CSA has revamped and extended its range of products and services to support parents through the separation process, including the ‘Me and My’ series of books, the Newly Unemployed Separated Parents initiative and the workplace training program ‘Staying Connected’

CSA won a Silver Award for its submission, Supporting Parents through Separation, in the Prime Minister’s Awards for Excellence in Public Sector Management.

Work is required to:

continue to work in partnership with community organisations, business, early childhood and community experts and other levels of government to support a stronger focus on early childhood with strong links to the National Agenda for Early Childhood

finalise the evaluation framework for the renewed Stronger Families and Communities Strategy (2004-08)

finalise the framework of the National Agenda for Early Childhood in consultation with state and territory governments

implement the National Plan for Foster Children, Young People and Their Carers

finalise the development of a new strategic program plan for the Family Relationships Services Program

implement the Government’s response to the House of Representatives Standing Committee on Family and Community Affairs Inquiry into Child Custody Arrangements in the Event of Family Separation with specific attention to the family relationships services dimension and the Child Support Taskforce

continue to implement the More Help for Families measures

finalise the process of harmonising contractual and reporting arrangements for FaCS youth support services

expand CSA’s existing range of products and services, such as the Newly Separated Unemployed Parents initiative and the ‘Me and My’ series of booklets to help parents manage their relationship with their former partner and help to identify issues for new relationships

continue to focus on collection of outstanding child support and improve collections for international cases

deliver more child support payment options and choices for parents through electronic service delivery channels

review and improve parent communication tools to better support parent awareness, choice and flexibility for child support arrangements

implement the new Child Care Support Program including:

developing transitional arrangements for services to help ensure their continued viability

working with stakeholders to further develop and publish guidelines relating to the new funding model

ensuring that program changes are introduced with minimal disruption to children, families and services

continuing to conduct funding rounds for in-home care and long day care to establish additional child care places in areas of identified high need to maximise choice for Australian families

establishing an appropriate and robust evaluation framework

finalise the process of harmonising contractual and reporting arrangements for youth support services

establish new JPET program arrangements following the 2003-04 selection process.

Budget measures

This section reports on the achievements and challenges in implementing Budget measures for which expenses began accruing in 2003-04 and as tabled in the relevant Portfolio Budget Statement or Portfolio Additional Estimates Statement. They are listed by published title and in alphabetical order except where interlinked measures are grouped for ease of reading.

Child support debt collection—additional compliance activity

The Government provided CSA with additional funding of $31 million over four years to enable it to collect $131 million more in child support payments under the Intensive Debt Collection measure. By 30 June 2004, CSA had contacted about 15 100 parents who had a child support debt and collected $19.3 million more in child support payments for children. In addition, growth in gross maintenance debt has declined.

A key strategy in achieving increased compliance has been the late payment penalty incentive offer. Parents who entered into an agreement to repay their debt within two years and met their ongoing child support liabilities will have their late payment penalties cancelled when the debt is repaid. Twenty-seven per cent of parents contacted had taken up this offer.

Other successful strategies have included implementing a phone-first philosophy, taking a more direct approach and offering parents options to enable them to meet their responsibilities. These strategies are progressively being integrated into other collection activities undertaken by the agency.

Child support improvements—support for unemployed parents

The Government provided CSA with funding of $11.9 million over four years to support 31 500 newly separated parents who are not living with their children and are receiving Newstart Allowance. The initiative, which commenced in July 2003, aims to improve the motivation and capacity of these parents to return to work by providing them with relationship and parenting support. It is expected to deliver economic outcomes (through earlier return to work resulting in reduced outlays on Newstart Allowance and Family Tax Benefit (FTB), and increased child support payments) and social outcomes (through improved parenting and relationship skills). This is the first time in Australia that the impact of relationship separation on unemployment has been considered and addressed.

Research and consultation with other government agencies, parents and the community sector was undertaken and has informed the development of the range of programs, products and services that are being offered to support these parents. Programs are under way in Brisbane and Melbourne through employment service organisations to explore and develop the most appropriate approach to align jobseeker activities with services aimed at building parenting and relationship skills.

Identification of and contact with this parent segment has proved challenging. Nevertheless, CSA has improved telephone contact by over 25 per cent, and provided written support and information to over 10 000 parents.

Family support-additional family day care places

The Government provided 2500 additional family day care places in 2003-04 commencing in January 2004. Fifteen hundred further family day care places were announced in the 2004-05 Budget. These new places represent nearly a six per cent increase in the number of family day care places available and were sufficient to meet the current verified demand from service providers. The availability of these extra places will assist many more families to access affordable, quality child care. Access to quality child care helps parents to participate in employment, training, or community activities and to better balance their work and family responsibilities.

Family support—additional outside school hours care places

The Government provided 10 000 additional outside school hours care places commencing in January 2004. Thirty thousand more outside school hours care places were announced in the 2004-05 Budget. These new places represent a 17 per cent increase in the supply of outside school hours care places and were sufficient to meet the current verified demand from service providers. The availability of these extra places will assist many more families to access affordable, quality child care. Access to quality child care helps parents to participate in employment, training, or community activities and to better balance their work and family responsibilities.

Family support—additional playgroup services

Building on the existing playgroup program, $14.9 million in additional funding over five years was provided to expand playgroup services. This funding provides for 4000 new mainstream playgroups and over 200 supported and intensive support playgroups.

Family Tax Benefit and Child Care Benefit-extension of time for top-up payments and claims

The Family Assistance Legislation Amendment (Extension of Time Limits) Act 2004 was passed by Parliament on 1 April 2004. This legislative change allows 12 additional months for the lodgment of tax returns for FTB purposes. Families will now have 12 more months in which to receive a top-up to their payments or to claim a lump-sum payment for FTB and their Child Care Benefit (CCB).

The 12-month extension to the time limit will apply to those families who are seeking top-ups or payment for the financial year 2001-02 and onwards.

Men and Family Relationships and Family Relationships Education programs—extended funding

The Men and Family Relationships (MFR) and Family Relationships Education (FRE) programs received an extension of funding of $25.1 million over four years, beginning 1 July 2003.

The MFR program includes more than 40 community organisations delivering family support services to men in more than 80 locations in rural, regional and metropolitan Australia. Under the FRE program, more than 40 community organisations are funded to provide prevention and early intervention services to families across Australia.

The funds allocated to the MFR and FRE programs in the 2003-04 Budget were used to maintain the existing MFR and FRE services. The MFR services have developed and implemented innovative and effective approaches to working with men to improve individual and family outcomes. The FRE services provide valuable support to many Australian couples at the time they are forming families.

National Illicit Drugs Strategy—Strengthening and Supporting Families Coping with Illicit Drug Use

In the 2003-04 Budget, additional funding of $3.246 million was approved to extend current projects and fund an evaluation of the ‘Strengthening and Supporting Families Coping with Illicit Drug Use’ measure. All projects have been implemented and are expected to be completed by June 2005.

Family support projects include training and skills development of workers, direct support, information and referral assistance for parents, and specific Indigenous drug services.

The evaluation of the measure in October 2003 concluded that projects enhanced the emotional wellbeing of families, improved communication within families and contributed to reducing or preventing drug abuse.

While the implementation of the measure resulted in a wide range of differing projects that were beneficial within the particular state or territory jurisdictions, the evaluation called for a stronger national framework for subsequent programs under the measure.

Changes in program delivery arrangements from July 2004 will direct funding to community organisations. This is expected to lead to smoother implementation of projects and enhanced program management processes.

One-off $600 per child bonus payment

As part of the 2004-05 Budget, the Government introduced a one-off $600 per child bonus payment for those families eligible for or in receipt of FTB Part A on Budget night. Families with dependent children under 18 in receipt of Youth Allowance on Budget night were also eligible.

Payment was automatically made to 1 960 000 families receiving FTB and Youth Allowance prior to 30 June 2004.

In addition, the Family Assistance Legislation Amendment (More Help for Families-One-off Payments) Act 2004 provides authority for the Minister to establish an administered scheme to make one-off payments to eligible families and carers not included in the initial payments made in June. This scheme closes on 30 June 2007.

Our Universities—income support treatment of Commonwealth Learning Scholarships

Our Universities—income support treatment of fee-exempt scholarships

Measures have also been introduced from 1 January 2004 to facilitate increased higher education participation of students by excluding the value of fee-exempt scholarships provided by higher education institutions and Commonwealth Learning Scholarships from the assessable income of students who receive income support payments. All categories of full fee-exempt scholarships and Commonwealth Learning Scholarships are excluded from the social security income test.

Our Universities—exempt fee-waiver and fee-pay scholarships from social security income tests

Measures have been introduced from Budget night, 11 May 2004, to facilitate increased higher education participation of students by excluding the value of fee-waiver and fee-pay scholarships from the assessable income of students who receive income support payments. This includes scholarships offered in respect of the secondary, vocational education and training, and higher education sectors. Additional income support payments have been made on an ex gratia basis until passage of the legislation. Fifty-six students’ scholarships were exempted under these measures and payments totalling $11 578 were made on an ex gratia basis. The value of all fee-waiver and fee-pay scholarships offered in the secondary, vocational education and training, and higher education sectors is excluded from the social security income test.

Reconnect and Job Placement, Employment and Training

During 2003-04 the Government:

extended the Reconnect program with indexation

provided funding to improve and streamline the administration of Reconnect and the Job Placement, Employment and Training (JPET) program

provided extra funds to maintain service delivery provided through the JPET program in regional Australia.

During 2003-04 current levels of service delivery were maintained for 100 per cent of Reconnect and 98 per cent of JPET services.

Special Needs Subsidy Scheme-additional funding

The Special Needs Subsidy Scheme (SNSS) received an extension of funding of $25.8 million over four years, beginning 1 July 2003. As at 30 June 2004, a total of 3461 children with high ongoing support needs had been accommodated into mainstream child care with the additional funding.

SNSS provides assistance to approved child care services to employ additional carers to support the inclusion of children with high ongoing support needs into mainstream programs. This includes children with diagnosed disabilities, children undergoing continuing assessment for disabilities, or developmental delay, and refugee children who have been subjected to torture and trauma.

Student Financial Supplement Scheme-repeal

The Student Financial Supplement Scheme (SFSS) was a voluntary loan scheme for eligible tertiary students. The SFSS was closed on 1 January 2004. No new loans have been issued since 31 December 2003.

Sugar Industry Reform Program-crisis counselling

The Government provided $0.3 million in 2003-04 as part of the $5 million package over five years for financial counselling and family support services for families in sugar-growing regions. This measure was announced in the 2004-05 Budget.

Counselling services will be delivered through existing programs administered by FaCS.

Support for Indigenous people—Longitudinal Study of Indigenous Children

The Longitudinal Study of Indigenous Children (LSIC) was announced in the 2003-04 Budget. LSIC will focus on the links between early childhood experiences and life outcomes. In time, the study will provide a data resource that can be drawn on by Australian governments, researchers, service providers, parents and communities.

In 2003-04, a national steering committee, chaired by Professor Mick Dodson, was established to oversee the project. Subsequently a subcommittee to advise on specific issues such as design, content, implementation and findings was established and began development of a community-based design involving working in partnership with Aboriginal and Torres Strait Islander communities. The literature and research relating to Indigenous issues in early childhood has been reviewed to provide informed context for the design.

Throughout the year, the FaCS project team conducted meetings around Australia to consult with Indigenous peoples, communities and organisations in every capital city and at least one regional area of each state and territory. These consultations have informed the decisions of the steering committee and the development of the design.

Youth Allowance—ex gratia payments to former recipients in South Australia

The Government provided funding of $0.2 million in 2002-03 and 2003-04 to make ex gratia payments to Youth Allowance recipients who became ineligible for any income support payments when the school-leaving age in South Australia was increased from 15 to 16 years on 1 January 2003. Ex gratia payment recipients received payments until their sixteenth birthday, when they may again be eligible for Youth Allowance.

The ex gratia payment no longer applies as all recipients had turned sixteen by 31 December 2003.

Youth Allowance—waiver of certain debts

The Government decided to waive certain Youth Allowance debts at a cost of $8.4 million over two years. Debts waived were those created as a result of overpayments associated with the manual reviews undertaken as part of the parental income test (PIT) linking initiative announced in the 2002-03 Budget.

Youth and student assistance-restructured reviews

Service profiling of Youth Allowance was implemented from July 2002 and expanded from July 2003. Service profiling of Austudy Payment commenced in April 2004.

Service profiling is a means of identifying which customers need a more focused or targeted level of service to assist them in meeting program outcomes (e.g. correctness of payment, activity test compliance, economic and social participation).

FaCS and Centrelink have worked together to identify customers’ level of risk against program outcomes and the levels and types of customer contacts most appropriate for managing these risks. Service profiling informs staff about the details they need to discuss with customers selected for particular program reviews. Centrelink customer service officers will be able to focus their attention on those customers who require a high level of support or assistance.

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