Dunne: consultation to make child support scheme fairer

Revenue Minister Peter Dunne today launched a discussion document proposing a series of options – including changing how child support is calculated – to make the scheme fairer.

Mr Dunne said he wants New Zealanders’ views on a number of options to improve a child support scheme that “is outdated and sometimes unfair”.

“The reality is that family life in New Zealand has changed considerably in the 18 years since the current scheme was introduced,” Mr Dunne said in releasing the Supporting Children discussion document.

“Families have evolved and their domestic and financial situations have changed, and are often more complex today than they were in the past.

“Today both parents are far more likely to be working than was the case in 1992, and often separated fathers have a far greater involvement with their children than they used to have,” he said.

“We need a child support scheme that works better and we need New Zealanders – particularly those whose lives are impacted by it – to contribute to a national discussion on this very important issue,” he said.

However, Mr Dunne said his first message to New Zealanders was simple: “While we need a scheme that serves children better and is fair to parents, we do not want people in this system if it can be avoided.

“It is better if parents can come to their own arrangements for the benefit of their children when their relationship breaks down. Child support is a backstop when you cannot do that.

“It should be the last choice, not the first,” he said.

Currently, the scheme arranges financial support for the care of 210,000 children.

Mr Dunne said Supporting Children outlined a range of options for improving the scheme.

These include changing the formula that determines the amount of child support payable to take into account factors such as the cost of raising children today, the degree of shared care between parents who are living apart, and the income of both parents.

“An important part of getting the scheme right will be creating a situation where paying parents are more likely to comply with their obligations voluntarily.

“They are more likely to do that if they see their obligations as fair, transparent and reasonable – and not based upon some formula that seems to have no regard for their individual circumstances.

“The options in the discussion document also seek to get a balance between the welfare of the parent who receives child support and the obligations of the parent who pays it,” Mr Dunne said.

“In keeping with the need for this balance, the document asks whether child support payments should be automatically deducted from employees’ income, and whether the penalty and write-off rules for child support need to be amended to provide better and more effective incentives to pay.

“I urge all interested parties to have a say on the options in the discussion document. They can do that either in writing or by taking part in an online consultation which gives a brief description of the issues and seeks participants’ views on them.

“These contributions will have a big influence on ensuring that we have a child support scheme that works as effectively as possible, for the well being of our children,” Mr Dunne said.

The discussion document Supporting Children is available at www.taxpolicy.ird.govt.nz. The online consultation is available at
www.supportingchildren.ird.govt.nz

Submissions close on Friday, 29 October 2010.

[Scoop copies: 2010ddsupportingchildrensummary_0.pdf, 2010ddsupportingchildrenfull_0.pdf]

ENDS

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