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Mon 31st August 2009

Dads weigh in over child support

Filed under: General — gh @ 8:51 am

By PHIL HAMILTON – The Press
Fathers are backing a Families Commission proposal for more shared parenting ahead of a review of the child-support scheme.

Inland Revenue will shortly release a discussion document on possible changes to the child-support scheme.

In response, the Families Commission has released an issues paper that suggests child support should be based on the needs and costs of the child, rather than on the income of the liable parent, and payments should be passed on to the parent who is getting the domestic purposes benefit or other social security benefit.

Jonathan Young, a former Father and Child Trust social worker and father of one, said the Families Commission proposals made sense and would be fairer for fathers.

He said most fathers with whom he had dealt wanted to support their children, but objected to paying money to Inland Revenue which did not help their children.

“A lot of these guys were having the kids a couple of days, paying school fees and clothes, and then paying child support on top,” he said.

“That child support wasn’t benefiting the children; it was just going into the government coffers because the mother was on the DPB.

“They would much rather pay that money if they knew it was going to be spent on the kids.”

Union of Fathers spokesman Darrell Carlin said the proposals would be more equitable and balanced.

“But the key is equal-shared custody,” he said.

“Then the costs are shared equally. I think it’s inevitable that we head to solutions like that, but it’s a case of how long do we dance for? The pace of change is glacial.”

Carlin said when he separated from his wife 10 years ago he was prevented from seeing his child, but still had his salary garnered.

“I was reeling from the fact I had a young child I suddenly wasn’t able to see,” he said.

“Then the child support kicked in. My employer came in and said we’re taking this money out each week and that was the first I heard of it.”

Eventually, Carlin got shared custody.

“When he’s with me I pay, and she pays when he’s with her, and it becomes so straightforward at that point.”

Carlin said child support based on income, rather than the children’s needs, was always a problem for the person paying.

“I don’t find many fathers who don’t want to support their kids, but they’re troubled supporting their ex’s lifestyle.

“We try to get the guys to bring payments down to a minimum and then they can say `I will pay for shoes and uniforms’.

“Then we find they will pay more than required. It’s human nature. If you’re told you must do it, it’s irritating and you try to buck the system.”

Chief Families Commissioner Dr Jan Pryor said with one in four children living in a sole-parent family at some point in their lives, the issues of separated parenting were of vital concern to New Zealand families.
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“We must make the most of this opportunity to do the best we can for these children and their parents,” she said.

Figures released this month show that almost a third of liable parents are shunning their child-support obligations, the highest rate in five years.

At June 30, the shortfall totalled $1.5 billion.

Inland Revenue is chasing more than $527 million owed by parents, with more than $1b owed in penalties.

However, one third of all debt is owed by Kiwi parents living overseas.

Figures issued under the Official Information Act show more than 127,000 parents have child-support obligations, but 37,702, or 29.5 per cent, fail to pay.

The debt owed by 547 parents earning six-figure salaries has nearly doubled in three years to $10.9m.

25 Responses to “Dads weigh in over child support”

  1. julie says:

    Thanks for sharing this.

  2. MurrayBacon says:

    It is a convenient myth, that when parents have shared care but one is on DPB and the other paying [spousal and] child support, that they should share the costs such as school fees, clothing or other major expenses for the children.

    In the DPB situation, it isn’t shared care, as one parent isn’t working and paying taxes. If there is a large number of children, it might be fair, but for a single child, it is just a soft rort.

    The DPB is seen as fully providing for the children. If the children are then partly cared for by the non custodial parent, why should the custodial parent benefit further through shared care? It is really just selling the children’s time, not shared care…….

    The NZ [spousal and] Child Support Act was passed into legislation, without any detailed explanation of where the formula came from, or how or why it had been altered from formulae applied in other jurisdictions.
    In essence, the formula was copied from Australia, with negligible change.
    The Australians had copied their formula from Canada, but with a small increase in the % of income charged. I haven’t been able to find any explanation of why the Australians increased the income %, as Canada has a similar taxation/free Government benefits structure as Australia.
    The Canadians copied their formula from Wisconsin, but with a significant increase in the income %. This is extremely surprising, as Canada is much higher taxed and provides much higher Government benefits than Wisconsin. Therefore, you would expect that the income % would have been reduced, not increased!!!!????
    It seems that the Canadian officials who made this increase were all on very high incomes and their decision was that men can take care of themselves (somehow!?) and the mothers should be given every available coin to take care of the children. Sounds like sympathy rising above analysis of facts, doesn’t it?

    evidence-is-easily-swept-away-by-sympathy

    The Wisconsin formula was based on the situation where both parents were in receipt of Government income support or benefits and then taking as much money as possible from the father to give to the mother.

    So Australia and NZ have increased the income% figure, from the maximum possible that could be taken, as judged in USA. They have then applied the formula in a wider range of situations and incomes, than it was originally conceived for.

    When you consider these issues, is it fair to say that the taxpayer-parent should cover 50% of the expenses?

    If the person on DPB is funded to fully care for the child, but actually providing only 50% care, or 80% care, then why should the taxpayer-parent be expected to carry half of the actual expenses? (If the DPB parent forwarded the proportion of the DPB relating to the time the children were in the care of the taxpayer-parent, then it would be more realistic!!!)

    I suggest that when there is a taxpayer-parent and a DPB beneficiary, that the taxpayer-parent should only pay for out of pocket expenses during access. Even this will often be quite strenuous.

    The real problem is the Government wanting to pay the benefit only to the mother, rather than to paying benefit in proportion to the actual expenses incurred by the parents. Surely this indicates that the Government made these decisions, based on values which are illegal under Human Rights legislation, (but for the exemption the Government has given to itself! This brings out NZ’s lack of a working constitution.).

    I hope this helps to understand this issue in practical terms.

    Also note that the discussion above refers to the old Australian formula. About 2006, Australia revised their formula, to reflect the costs of actually caring for children in shared parenting situations.

    Remember that National Party wrote the [spousal and] Child Support Act…. Maybe it is time to remind them about their sins?

    Why is NZ so far behind, in terms of equity between parents?

    I guess it is the sheeples factor?

    One important issue is incentives. Does the present NZ [spousal and] Child Support Act persuade parents to best share the overall burdens and pleasures of caring for their children? I suggest that the way the Government operates this Act through IRD-CS is quite destructive of the children gaining the best from their parent’s resources.

    Cheers, MurrayBacon the patient and relentless axe-murderer.

  3. Jim Bailey says:

    Great News I hope they carry much of what is said in the News Paper article forward.

    Jumping the gun and working thru any FAMILY issues before **Preferential Equal Shared Parenting** leading to ALL Children being valued by their **Whole Natural Biological FAMILY** is Enshrined DEEP within FAMILY Law and Social Policy is a waste of time.

    ALL FAMILY Law and Social Policy MUST be based on **Equal Parenting** or the Injustices currently in the system will remain.

    Onward – Jim

  4. Fearless Frank says:

    If one parent is on DPB, and only caring, say 5 days out of seven for a child, will DPB be reduced accordingly?
    If there is shared care 50/50, will the parent choosing to remain on DPB only receive 50% of the benefit?
    Why not?

  5. MurrayBacon says:

    Social Security Act

    It sounds unkind to do it to a child, but read the fine print and you will see it is unkind to the non-custodial parent!!!
    [Under Care of Children Act 2004 these terms are meant to no longer be used, ha ha ha..]

    27BA Split custody

    Hope this answered the question.

    Try the legislation website search facility – it just doesn’t mention “Speight’s Dark” in the Social Security Act. Don’t take my word for it, try it yourself!

    Work out the values behind this legislation for yourself. Better still, do something about it….

    Sorry, ‘ve just sharpened my axe and I couldn’t resist it.
    MurrayBacon wanton axe-murder.

  6. mits says:

    Have you seen some of the rottweilers on the DPB? No offense meant but I mean credit where its due some of these custodial parents know how to wrangle a dollar out of the system. They mightn’t care that the other parent is being bled dry or facing hardship, not their problem. But by god and all that is unholy if you look to be in anyway encroaching upon their sense of entitlement the indignant howls of protest will fill the air.

  7. MurrayBacon says:

    Entitlement – hints of narcissism.
    I am not sure that this is a good sign, bad enough in one parent of two. Somewhat dangerous to the child, in a sole parent.
    Clayton Weatherston didn’t give it a good name….

    Narcissism

    We sure ain’t protecting children by leaving them with “entitled” parents!
    Cheers, MurrayBacon.

  8. Morris says:

    Darn, I’m now confused and hoping someone can help me.

    I was about to apply for an IRD review, but thought their survey on the cost of raising children stuffed all that. I put the cost of raising a child at approx $100 a week…the IRD claims it is $270.

    Facts are: –

    Me, seperated for 5 years, live alone, son is now 12. Have recently won 50/50 Shared Care, but son stays with me approx 20 extra nights a year.

    Ex lives with a high income partner, has never taken our son on holiday, wheras I do 3 times a year. I buy him clothes and the expensive things he wants, ie new bike, PS3, computer games, cell phone, telescope (Yes i do spoil him, I know). Also I save $100 every month for him, hopefully for his Uni education.

    Ex works, is not on DPB. I pay her $488 a month, but claim CS from her, brings it down to $417 a month. She says she is broke but last year she & partner had planned a 3 week holiday to Aussie (son not included!) and she recently bought a fairly new car and new laptop. I help her pay the school costs.

    Am I being greedy in applying for a review? Do i have a snowballs chance in hell? Should I wait?

    I’d really a reply or two.

    Thanks

    Morris

  9. MurrayBacon says:

    Dear Morris, even though your ex is not drawing DPB, your [spousal and] child support payments are still being calculated on the same formula, as if she was on DPB.

    This makes it fair, doen’t it? – it makes no difference whether the custodial parent is on DPB or working, you pay the same [spousal and] child support.

    Objects

    Alternatively, maybe the formula should be different, depending on whether someone else is claiming adult support ie DPB from Government?

    Maybe if someone else was claiming adult support, then YOU should have the option of caring for the child and not paying child-tax-surcharge?

    As this sounds awfully user pays, then why isn’t it National and Act [please excuse the weak puns…] policy?

    This might actually save the Government a few $billion!
    It would also be likely to improve the parenting of children, as working parents usually have better mental health. I know that this is a circular argument, but it does result in improved outcomes for children, so why are we holding back on “benefits” all round? [please excuse the weak puns…]

    Cheers, MurrayBacon.

  10. MurrayBacon says:

    Dear Morris, is your “shared care” really shared equally?
    Who takes time off work, if your son is sick?
    Who runs around after school, when necessary?
    If in fact these burdens fall unequally, then maybe you could claim to be the principal caregiver?
    I suggest some care, as there may be other issues that you haven’t considered. Slow and careful negotiation is usually the best approach. Cheers, MurrayBacon.

  11. Danny says:

    Hi Im danny and this site has helped me alot over the last six mouths of seperation protection orders,parenting orders and so on.I finanturely in the shit but IRD still insist on $2253.40 a month I gess they dont give a toss about anybodys curcomstances.

  12. peter says:

    Hi,after reading the article in the press I am writing this to have my say.My ex wife and I split about 6 years ago .She choose to move to the North Island has she thinks the green is greener there.She took my 2 childern with her (big mistake).Now married to someone on a big income (100k)she owns a company (Womens Gym) and lives off my CS money of $1100 a month.I have just been through a 2 year court battle to see my childern through no fault of my own ,she tried to aleinate the childern fron me.
    As live to far away from the childern I can,t have shared care so I pay 24% of my gross pay.Thing like this need to be address by the govt.At my work place I have a good chance my doing O/T to get head but the govt come out take it away.When the childern did come to see me I paid for tha airfares as she said she couln’t afford them .I would have them for 4 weeks a xmas and still have to pay CS ,feed then ,entertain etc and take time off work.
    Yes its about time this CS payment was liked into and yes everyone got a different sitution.Things like it should be worked out on a 40 hour week salary,and other comminment to the childern.

  13. Scrap_The_CSA says:

    A ‘formula’ has many benefits (transparency,simplicity, fficiency, value as guidance), and InlandRevenue is favoured as an adinistering agency because it is seen as a neutral assessor, leaving less room for conflict.However, it is imperative that any new Child Support Scheme is flexible enough to accommodate any changes without creating a significant burden on parents. (From the Families Commission Issues Paper)

    Once again the thinking of the Families comission is the same as the thinking that caused the problems with Child Tax we now have.

    Regards

    Scrap

    P.S. Why should anyone have to pay child tax?

  14. karan jiharr says:

    hey guys .. if one parent is on DPB the other working.. doesn’t it ogically say that the worker parent is more responsible and capable of looking after the kid.. so why does the courts award majority custody to the DPB parent who is incapable of supporting own self (relies on others to do it) .. when one can;t support oneself, how can that one be responsible enoiugh to support dependents.. makes no sense at all..

  15. karan jiharr says:

    i also reckon until custody is resolved, IRD should not be taxing the parent without the kid.. at the moment they go with whoever grabs the kid first.. give them the money. this does not help in access for both parents.

  16. tren Christchurch says:

    karan,

    They have to reward with substancial incentives the tools they use to run their divorce industry efficiently. These tools are women. Foolish the woman who stays with a hubby that ‘does’ not love her any more’ when these fantastic deals are around. We are in presence of State assisted divorces and kidnapings of children. The looser is of course the Father. This kafakesque situation demands peaceful revolutionary means to oppose this modern cynical tyranny.

    Know who are your ennemies. See who reacts when the sanctified DPB is threatened by reforms. Women’s Refuge, Family (ex Wifes) commision, Barnardos, Sue Bradford etc etc…

    DPB is economically socially not sustainable when it will reach critical mass and IT WILL.

  17. danny says:

    Ha great your takin an intress in you childs life.I have fore children and I know there living in not the best curcomestances.All you can do is go foreward and be the best person fore your kid.Dont worry about the past focuss on your future,I know it seems dawnting at the moment,things will get better.I just spoke to my ex fore the first time in 8 mouths only because she coked up.So dont think she will grow ha but you can go and do some courses F/C loves this shit,ha Id do everything I had to to be apart of my childs life.Is up to YOU.

  18. Bevan says:

    Here is the first report prepared for the review of the Child Support Act.

    I certainly wouldn’t trust the independancy of it given the authors are IRD/Treasury lackeys. It also highlights the flawed thinking of the officials. Note how the authors only include 3 objectives of the Act when in reality there are 11. I believe the most important objective is “to ensure that equity exists between custodial and noncustodial parents, in respect of the costs of supporting children”. Obviously the officials don’t rate this objective very highly. The instant you try linking costs to income, inequities will be created.

    According to the report those on high incomes spend 3 times as much on their children as those on low incomes therefore a child of a high income family costs more than a child of a low income family. Wrong. The child costs the same. Assume a family earns a low income. It costs x amount to feed, clothe, educate your child and basic extra curricular activities. You can’t afford overseas travel but you have family vacations away camping, staying with relatives and the like. Assume you become a middle income family. Your child still costs the same but you have the option of either buying more expensive items for your children, spending more on yourselves, an overseas family holiday or saving more for future big ticket items or your own retirement. You then become a high income family. You now have more options and choices on how you spend your disposable income. Your child does not cost any more, you just have the choice on how much you spend on them.

    Apparently the next part of the review is the “basket of goods approach”, so we sit back and see how the government turns that one into their favour.

    Here’s my simple approach to child support. Work out what it costs to provide the neccesities (food and clothing) for a child (excluding housing as this will be born by both parents in seperate households) on a weekly basis. Any additional costs such as schooling, sports and such should always be shared 50/50 anyway. Split the cost 50/50 and the noncustodial pays their share to the custodial parent. Assume a standard custody arrangement (noncustodial has fortnightly weekends and a share of holidays). The costs the noncustodial bears when the child is in their care are fairly negligible at this point. As custody moves towards shared parenting the noncustodials payment is adjusted to reflect the increased costs they must bear so that at 50/50 shared parenting neither parent pays the other and they still share the additional costs of schooling and sports 50/50.

    If a family is used to a certain standard of living up to the point of separation then these situations should be looked at on a case by case basis, but the above would be the fairest for the majority of families.

  19. Bevan says:

    Sorry, that was my first post on this site and I didn’t get the link to the report right.

  20. Morris says:

    Good post and good thinking Bevan. These were precisely the thoughts I expressed to Peter Dunne via email last week. Yes I did get a reply re my concern that the IRD survey indicates it costs $250,000 to bring up a child to age 18…the Families Commission has been instructed to contact me.

    Dear God $250,000? Or $14,000 a year to raise a child? The avg disposable income in Southland is a mere $22,000 a year as reported in the Times.

    I feel damn sad for any family earning less than $50k.

    The only glitch I see in your approach, while it looks fair, is that how would you ensure that each parent fronts up with the money regarding the additional costs of schooling & sport? What happens when Mum or Dad claims he or she is too broke to share the cost of a school outing or the cost of rugby boots?

    Thanks also Murray for your feeback..it gave me some food for thought.

    Morris

  21. Scott says:

    A review should always be applied for, if for no other reason than to test your case. The IRD beauracrats need to be kept busier, it would be good to bury them in paper work. The act is not “just” nor is it “equitable”, there is however a chance that a “fair” arrangement may be arrived at through the review process. Prapare well, make sure you pass through the legal “gates”, good luck.

  22. Raza says:

    I was never a big fan, but the families commission did some good work here and credit is due. Looks like Jan Pryor may make it more effective than Prasad.

  23. Dave says:

    We need to fight against all links to income. The levels need to be set to provide the basics for the kids. It is up to the parents to decide if, when and how they will pay more. This is not the government’s role.

    This paper makes the same mistake as the current system.
    It bases costs on an intact family spending. It stays people how earn more spend more on their kids. IT implies child support should be structured the same way. Then it recognizes that there are much higher costs in a separated family. It then passes all of these extra costs onto the liable parent.

    “The reason we focus on actual parental expenditure is that if children are not to share in the decreased living standard that necessarily results from the costs of parents living apart, then child support payments should be based on previous expenditure on children in the intact family.”

    This is unrealistic. The costs have increased dramatically in the separated family. They will be cutting back on all things including discretionary spending on their kids.

    The whole rationale and purpose of the child support system needs to be established. Otherwise we are just going to have a variation of the current system.

  24. Dave says:

    This study also excludes mortgage capital costs. However mortgage capital costs will more than double in a separated family.

  25. Mr. Anonymous says:

    Hmm, so it “costs” money for the average Kiwi to raise kids? Here are some interesting numbers of what it REALLY costs to raise a kid in New Zealand.

    Looking at the help you get from the government as a single parent (actual numbers will vary but you can easily check them for you own situation).

    Here is the help you get in order to meet the $250,000 estimated cost to raise a child to age 19.

    Family tax credit. $88 per week.
    Accomodation suppliment $70 per week.
    In work payment $60 per week.
    Childcare subsidies. $100 per week.

    Total $318 per week in subsidies (not including any contribution from custodial or non-custodial parent.)

    $318 per week * 52 weeks = $16,536 per year given to parents to “help” raise a child.

    $16536 * 19 years = $314,184.

    Hang on a moment, didn’t’ they say it costs $250,000 to raise a child? But the government alone is paying a solo parent $314k of taxpayer money (mostly earned by men). This is without child maintenance paid by the non-custodial parent (most of which are also men), or any contributions from the custodial parent whatsoever (mostly women).

    Adding in child maintanence (at $70 per week) we get $383,344 paid to a custodial parent to raise a child to age 19, and they STILL don’t have to contribute any money they have earned themselves to raising the child.

    That’s an overpayment of $133,344 (spread over 19 years, or around $135 per week). Not bad money to be PAID for raising a child, on top of what it really costs.

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