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An Assessment of Proposed Changes to the Child Support Formula

Stuart Birks
Massey University – College of Business
Policy Quarterly, Vol. 7, No. 1, pp. 31-38, February 2011

Abstract:
The current New Zealand child support formula has been in place for nearly twenty years. Despite recognised problems and ongoing dissatisfaction, only minor changes have been made in that time. The current Government has opened consultation on proposed changes which address some of the major issues, in particular the assessment of costs of children, consideration of the income of both payer and payee, and allocation when care is shared. IRD analysis replicates an Australian approach to derive a proposed alternative formula. This paper assesses the analysis. It finds that results are highly sensitive to the assumptions, that the formulation is based on questionable concepts, and that there are hidden assumptions which may be a cause of current dissatisfaction and harmful to children. A simplified alternative is suggested which recognises the limitations in analysis and implementation and may be more acceptable

Well worth the read.

Regards

SCrap

Robert Wiston discusses Dr Linda Neilsons work
Dr. Linda Neilsons website
While most American women obsess about the laments of frazzled mothers, a handful of their daughters at Wake Forest University are turning their attention to the study of that mysterious and often-demonized species — fathers. Yep, you read it right. Fathers. Dear ol’ Dad. Remember him? Each week, these young women (and one young man, who signed up because he hopes to be a good father someday) arrange their desks in a circle with Dr. Linda Nielsen, psychologist, professor and author, to learn about fathers and fatherhood in the only such college course in the country. The class is not a therapy session or support group, but a tough college course like any other, involving research, reading, field projects, papers, tests and grades. It’s just harder than most because it also involves introspection, self-analysis and the search for insight into one of life’s most important relationships.
by Kathleen Parker from Orlando Sentinel May 2, 2005
……………..

This has been a dark week for men in New Zealand with many influential people displaying ignorant misandry. Their comments show that they do not deserve to be in positions of influence.

The roller coaster was started with the government’s announced changes to our welfare system. (more…)

Hi all,

I am seeking to activate a network of parents who are concerned about the changes to the CSA 2012 to actively organise action and lobby MP’s etc.

If you are interested please email scrapthecsa@gmail.com

Regards

Scrap

Get ready Mums and Dads this is how child tax will be caculated in 2013 and as a result many of you are about to get done over by these changes.

How to workout your child support for 2013
Summary of key steps in determining child support payable for a particular child

Step 1: Work out each parent’s child support income amount (section 32). This is the parent’s taxable income plus adjustments to take into account a number of other forms of “income” (section 33), less:
- a living allowance (section 34);
- any allowance for other dependent children (section 35); and
- any allowance for other children from other relationships (referred to as child support groups) for whom the parent is paying child support (section 36)

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Step 2: Work out the parents’ combined child support income
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Step 3: Work out each parent’s income percentage (section 31)
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Step 4: Work out each parent’s and non-parent carer’s percentage of care for the child
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Step 5: Work out each parent’s and non-parent carer’s care cost percentage for the child (section 16 and schedule 1) that relates to their care percentage
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Step 6: For each parent, subtract their care cost percentage from their income percentage (section 18). If the answer is positive (i.e. the income percentage exceeds the care cost percentage), the parent is a liable parent. If the answer is negative, (i.e. the income percentage is less than the care cost percentage), the parent is a receiving carer
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Step 7: Work out the expenditure for the child using the child expenditure table (section 36D), taking into account the combined child support income amounts of the parents, the number of children in the child’s child support group; and the age of those children. This expenditure amount is divided by the number of children in the child support group to get a per child amount
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Step 8: The annual rate of child support payable by the parent for the child is worked out using the formula (section 29):
(parent’s income percentage – parent’s care cost percentage) x expenditure on the child
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Step 9: The amount that a carer receives is determined in sections 36A-C. A receiving parent receives an amount calculated applying the formula in step 8, based on their income and care cost percentages. If this is less than the amount that the liable parent pays, the balance is split between any other receiving carers
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Step 10: When a parent is paying child support for more than one child support group, the amount may be capped. If the amount calculated at step 8 is more than the amount calculated under the multi-group cap (section 29), the multi-group cap amount applies. This cap ensures the liability is no more than it would be if all the children from the various child support groups were living together
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Step 11: The amount payable may also be subject to minimum annual rate (section 30)

Dont worry, like any efficent tax they will be deducting at source and we all know IRD never get it wrong.

Regards

Scrap

I read this at my father’s funeral today:

When I went to Middlemore last Sunday to identify dad’s body, the young cop asked me: “How long have you known the deceased?”

Well, it’s been 55 yrs.

Now I know you’re not supposed to speak ill of dead but some things have to be said.
(more…)

Developments in behavioural research in the last 40 years should have long ago swept away the old ignorant prejudices, that substitute for valuable decision making in familycaught$.

The familycaught$ is largely backward looking, in attempting to decide cases by fitting them to preceding cases, rather than deciding cases according to the facts of the case and in accordance to our legislation (which requires that the interests of the children should be protected). (more…)

I have recently been made unemployed and have since found out that I owe 12,000$ in Child support from the periods ending 2004 & 2005, I thought this was strange because I become bankrupt in 2004.

After some investigation into this I found it was estimated on my 2003 income @ the maximum allowed – I did not earn that much during 2004 – 2005

After discussing this with the person in charge of my account, they have told me that I will have to apply for an administrative review.

Although after reading through a lot of this site it has become apparent that this isn’t necessary a good idea.

Although all the other cases seem to be about actions brought against men?

If someone could please perhaps point in the right direction or give some tiddbits of advice I would be forever grateful

Paul Jenkins is a name we should not forget. It confirms what we all know, child tax enforcement is draconian, brutal and drives dads to kill themselves.

Ask yourself the question: What does the IRD do? IRD is the revenue collection department, the tax woman. Its reason for existence is to collect money from citizens. It’s the Department that collects child tax. Its who advises Dunne so there is little surprise with the tinkering to the child tax act that Peter is promoting.

The whole purpose of the change is to increase compliance at the least cost for the highest return. This bill is not about making fundamental changes its a few baubles, packaged together to insure you comply.

Why are child support payments to be compulsorily deducted from salary and wages?
Paying parents will have their payments automatically deducted from their salary to ensure that as many child support payments as possible are made, and made on time

This legislation and analysis that led to the tinkering is still focused on the “same old, same old” Taxing Liable Parents via a formula assessment, a system that has failed worldwide because of the assumptions used to create the system.

Those assumptions include; Parental responsibility aka benefit recovery, income equalisation, all dads are deadbeats, one size fits all, imaginary incomes, the cost raising children……. These assumptions lead to the tinkering Dunne is proposing. It is nothing more than a 20th century solution, already out of date.

The Government’s concern is about increasing the fairness of the child support system. Although it is recognised that, for some parents, changes to the formula will result in lower amounts being received, any move to a revised formula would be made with the aim of reducing current inequities to ensure the system is more balanced, that paying parents honour their responsibilities to their children and that it is perceived to be fairer overall. It should also be noted that the other (non-formula) changes to the child support scheme are designed to improve child support payment rates, meaning that more receiving parents will receive child support payments than is currently the case

Read the info from IRD and get ready for action.

Regards

Scrap

Following Paul Jenkins death by child tax miraculously Dunne’s disaster to be gets a rapid path to first reading.

Child support is set to be overhauled in the biggest proposed changes to child support law in 20 years.
The income of both parents will be factored into child support calculations for the first time under the Child Support Amendment Bill proposed by Revenue Minister Peter Dunne which has its first reading in Parliament tomorrow.

This bill will not remove the fundemental flaws in the current child tax act, but will negatively impact, Tens of thousands of parents, particuarly Dads.

Regards

Scrap