2 Sep 2010

Major overhaul of child support system proposed

6:25 pm on 2 September 2010

The Government is embarking on what could be a major overhaul of the child support system.

It hopes to make it fairer while helping to reduce the massive debt owed by liable parents.

Possible changes include reviewing the formula used to calculate maintenance payments and beefing up the Government's ability to track non-paying parents.

Revenue Minister Peter Dunne, who released a discussion document on Thursday, says something has to be done to reduce the ballooning debt owed for child support, which, including penalties, stands at $2 billion.

The current law is 18 years old, he says, and needs to be changed to reflect modern-day society.

Both parents' incomes may be considered

At the moment, a liable parent's payments start to come down only if the child spends more than 40% of the week overnight at their house.

Mr Dunne says that that may not be the best way to determine the time spent with the child, and will be reviewed.

Another proposal is to take the incomes of both parents - not just that of the liable parent - into account when calculating payment rates. Mr Dunne says the current formula does not reflect the true costs of raising a child.

He also says the Government will consider a more flexible approach to penalties to encourage people to pay their primary debt, and also at better tracking and making automatic deductions from wages.

Father's group welcomes review

The national president of the Union of Fathers, Allan Harvey, told Morning Report his group would like to be part of the review, because the amount of debt shows that the current system isn't working.

Mr Harvey says any reform needs to focus on children and their needs, and he would like to see more shared care arrangements between parents.

A mother who is owed tens of thousands of dollars in child support arrears says the Inland Revenue Department could do more to recoup the money.

Lisa Bridson says the IRD could be more proactive in chasing up her former partner, who works as a self-employed contractor.