Many Unacceptable Flaws Of The Child Support Act

Families Apart Require Equality (FARE) Family Law Bulletin January 2003 Page Two.

Author: Bruce Tichbon Contact details and information about FARE.

Over the past decade FARE has approached politicians who support the Child Support Act, and used the Official Information Act, to try to obtain explanations of why the Child Support Act is so draconian. No satisfactory explanations have ever been obtained. The Child Support Act effectively embodies many profound social policies that are in fact fundamental flaws. These are described as follows:

Major Flaw No 1 -The Liable Parent's Financial Responsibilities Are Not Balanced By The Right To Be A Parent

Morally, the responsibility to provide financial support for a child goes hand in hand with the right of a parent to give love and care to the child, and to be involved in its upbringing. The Child Support Act, with its incredibly strong legal powers to make parents pay regardless, should be balanced by a system that helps liable parents and their children to have as much contact as possible, and a meaningful relationship with each other.

There is no such balance between the Child Support Act and the rest of the family law in New Zealand. The Family Court (and the Guardianship Act) makes getting custody and access vague and uncertain, and most liable parents are left with no meaningful relationship with the children they must pay for.

With the Child Support Act the Government has grossly violated an essential aspect of human family relationships. Currently, the right of the liable parent to care for their own children is in no way balanced in law by the responsibility of the liable parent to pay child maintenance. The integrity of families where the parents live apart must protected by ensuring that the biological parents both have a role in providing love and care for the children, that matches their role in providing for the children's financial well-being. Without this balance, one parent is usually subjugated by the other. Overseas experience shows balancing childcare with financial responsibility for both parents is better for the children, parents and the taxpayer.

The Shared Parenting Bill 2000 (put forward by Dr Muriel Newman MP) would have substantially corrected the problems of imbalance but the Labour/Alliance Government refused to support it.

Major Flaw No 2 - The Act Deliberately Creates Inequality Between Parents.

The Child Support Act splits parents into two types, an 'eligible custodian' and a 'liable parent'. Deliberately making the two biological parents in the same family unit unequal in this way has had a profound effect on the way a large proportion of New Zealand families now operate, and on how people see their families. The maintenance system that operated before the Child Support Act avoided creating unequal parents in this way. There has never been any justification given as to why the Government chose to make parents legally unequal. Differences can occur between the roles of the parents when caring for children, but these differences should be agreed by the parents, not mandated by Government without any proper justification.

Major Flaw No 3 - The Income Of Only One Parent Is Measured.

Only the income of the liable parent is assessed, and the liable parent is the one made to pay child support. The income of the eligible custodian is not assessed for child support purposes. But the custodian's income is actually assessed for taxation purposes independently of the Child Support Act. This whole arrangement is clearly unfair. Yet under previous maintenance legislation before the Child Support Act there was no problem in assessing the incomes of both parents for child maintenance.

Major Flaw No 4 - The Amount Paid Is Not Based On The Cost Of Supporting The Child

Before the Child Support Act the cost of supporting the child was calculated, and the amount of maintenance paid reflected that cost. However, for no apparent reason the Government ended this essential aspect, and now the Child Support Act bases the amount of maintenance on the liable parents "capacity to pay". It is virtually impossible to define what ones "capacity to pay" actually is, where as the cost of supporting a child is self-evident. Further, the Government now takes no responsibility for telling us what is a reasonable amount of money for supporting a child. The Child Support Act makes liable parents feel they are paying a fine or a tax, rather than paying to support their child.

Major Flaw No 5 - Is Child Support Really Alimony?

It is evident to thousands of liable parents that they are paying so much child support that they are really subsidizing the life style of their ex-partner. Many liable parents, in the absence of any guidance from the Government, do their own calculations, and come to the inevitable conclusion they are paying more than the cost of supporting their child. Anomalies of the type pointed out in (9) below make this injustice even more obvious. The Child Support Act is certainly a sneaky way of extracting spousal maintenance or alimony from many liable parents. On top of this liable parents can be made to pay additional spousal maintenance (Family Proceedings Act), get less than half the matrimonial property and contribute a substantial proportion of their future earnings to their ex-partner (Property Relationships Act).

Major Flaw No 6 - Custodian Has No Real Accountability To Spend The Maintenance Money On The Child

The custodian spends the child support money they receive as they see fit. There is no obligation under the Act to spend it all on the child or to demonstrate this to anyone (least of all to the liable parent). Because the Child Support Act has removed the linkage between the amount paid and the cost of supporting the child, the accountability of the custodian to spend the maintenance money on the child is further reduced. Many countries and States in the USA have made custodial parents financially accountable to spend the money on the child.

Major Flaw No 7 - Act Does Not Take Account Of The Circumstances of the Custodian

The custodian can generally earn as much as they like and this does not affect the amount that the liable parent must pay. It is ironic that the Government takes into account the custodian's earning and situation to suite itself. If the custodian is on the DPB and earns money, the Government reduces the amount of DPB it pays to the parent. Similarly, if the custodian gets a new partner who has an income, the DPB is (theoretically) stopped. But the liable parent gets no relief under these circumstances and is left out in the cold.

Major Flaw No 8 - Act Does Not Take Proper Account Of The Time The Child Spends With The Liable Parent

The Child Support Act does not allow the majority of liable parents reasonable recognition for the time the child spends in their care (that is those lucky enough to see their child at all). A reduction in child support payments is allowed if the liable parent has the child for 40% of nights or more, but the way the family law system operates very few liable parents are able to reach this threshold. This flaw could be easily fixed by incorporating in the formula a more linear factor for the amount of time the child spends with each parent. For example, increments of time of 10% (hence 10%, 20%, 30% etc) should be taken into account to adjust child support payments.

Major Flaw No 9 - Serious Financial Anomalies In The Child Support Formula

The Child Support Act has many serious financial anomalies, too many to list here. However, a classic example follows. The cost of a child living with a liable parent is valued by the difference between the living allowances with and without the child at about $5,000 per year (the exact amount varies slightly from time to time). Yet the same liable parent may typically have to pay child support of double this amount for a single child living with the custodian. Such a difference in the effective income of children living in different households is bizarre, and reflects the total lack of logic or fairness in the Child Support Act. The practical outcome of this and similar anomalies in the Child Support Act is that too many second families that must financially support themselves and pay child support are left destitute.

Major Flaw No 10 -The Child Support Act Is Forcing Thousands Of Workers From The Work Force

The Child Support Act imposes a supertax rate on liable parents, adding between 18% and 30% to their top marginal tax rate (which may already be as high as 39%). The cumulative tax rates are so high that a large proportion of workers who must pay child support have lost the financial incentive to be in the work force. FARE has seen thousands of people elect to leave the work force because of the Child Support Act. These families enjoy virtually the same standard of living by going on a Government benefit instead of working. Others workers elect to forgo promotion, or take low paid part-time jobs. The Government loses both the child support and the normal tax these people would have paid. FARE's experiences indicate that enough liable parents have taken these steps to wipe out all the financial gains of the Child Support Act (the Act is claimed to currently collect about $250 million per year plus about $75 million in penalties).

Major Flaw No 11 -The Child Support Act Puts Insufficient Requirements onto the Custodial Parent to Make an Appropriate Long Term Financial Contribution

Custodial parents are not expected long term to appropriately improve their position through retraining or paid work so that the standard of living of the children is improved, or so that the financial burden on the liable parent reduces. Custodial parents are in an excellent position to work once all their children attend school, yet under the current system there is no direct incentive or requirement for them to retrain or get paid work.

A liable parent is made to pay full child support for up to 19 years, with no direct requirement for the eligible custodian to make a commensurate effort.

Major Flaw No 12 -Liable Parents Assumed 'Guilty'

Under the Child Support Act, anyone named by an eligible custodian as the father of a child is automatically assumed to be liable. Thus it frequently happens that the first time a man knows he has been named as the father of a child is when he finds his salary has been deducted by the Child Support Agency. If the liable parent wishes to dispute the liability or seek a variation to the payments, then the burden falls onto the liable parent. The Child Support Act reverses what most people understand to be the cornerstone of our justice system, that "a citizen is innocent till proven guilty". Family law frequently assumes guilt in this way, reflecting how far New Zealand's family law has diverged from the principles that guide the rest of our law. The Domestic Violence Act assumes guilt in the same way, on the basis of a simple accusation (which can generally only come from a women).

Major Flaw No 13 -Paternity Deliberately Made Difficult to Contest

Based on overseas research, up to 20% of fathers being charged for child support in New Zealand are not the biological parent, and therefore most are not legally liable to pay child support. This means up to 40,000 fathers are being forced to pay child support under false pretences.

It is a very simple matter with DNA technology to test paternity in a manner that provides a result that would have legal standing in terms of the Child Support Act. In a typical DNA test currently costing about $700, only a hair sample from the child and the father is required. Simple and inexpensive measures can easily be put in place to provide proof that the correct father and child are being tested (such as a group photograph at the time the samples are taken).

However, it appears the Child Support Agency is intent on making paternity testing for fathers as difficult as possible. The Agency states that it has no policies on paternity testing, but it appears to have unwritten policies to force fathers to pursue paternity tests through the Family Court. Further, it seems the mother has to become involved, and effectively give her permission. This approach by the Child Support Agency effectively prevents the vast majority of fathers, who would like to have the test, from being able to test their paternity.

Major Flaw No 14 -The Child Support Act is deliberately being used for an affirmative action program

The Government has an official affirmative action program (called 'gender equity' or 'equity' for short) to favour women, so as to over come certain financial and social advantages they are assumed to suffer from. The term 'equity' is used repeatedly in the Child Support Act, meaning the act is to be used in a biased way to favour women. The general public has almost no knowledge that this is being done. Family law and the Judiciary cannot be used in this way without creating serious injustice, and making it far harder for mothers and fathers to work together in the best interests of their children.

Next: How To Make A Fair And Workable System For Child Maintenance