The formula for Child support in NZ, although simple is certainly not very fair from what the team here believe.
At Child Support NZ HQ we have people on both sides of the equation and have spent hours in discussions and research on this very controversial topic. It’s never possible to make all parties happy however we see many areas of improvements that could be made. We have outlined some of the things that are wrong and suggested an alternative, that could be more fair in regards to our circumstances, however are very interested in others opinions and insight so please share your thoughts with us and have a say.
One thing that should be considered is that child support is about children and making sure they are fed, clothed and educated. This is not about supporting ex partners as that is an entirely different discussion that we can address in another article.
Here are some of the major areas we can see issues with the current 18 year old child support system and formula in NZ.
- The custodian of the child does not have to spend the money on the children.
- The more you earn the more the other parent claiming child support gets regardless of how much the children cost. i.e one persons kids according to the governement must be worth more and cost more than another persons, even though they may cost similar amounts to clothe, feed etc.
- The paying parent is often the one that gets the least time with the child
- The custodians income and living arrangements are not taken into account. For example the mother could have a high paying job, live with a high earning partner and the poor paying parent ( father in this case ) could be struggling to survive on a low income, yet still have to pay maximum child support and spend the least time with the children
Ways non custodial parents can and do dodge child support ( also highly unfair )
- You can pay less by living with a partner that has children ( you get a higher living allowance, which is then deducted from your child support )
- You can have a company where the losses offset your personal tax
- Leave the country
- Disprove that you are the parent.
Changes in front of parliament now – reform of the child support law.
There is currently a bill in front of parliament lead by Peter Dunne to suggest changes to the NZ child support law. This however will probably take several years to have a new formula decided apon and then implemented.
The child support formula – how to work out what you are going to have to pay.
The standard formula uses a process which works out the paying parent’s taxable income, takes away a set living allowance (the amount of which depends on their living arrangements – such as if they have a partner and how many children live with them), and multiplies the result by a percentage based on the number of children the paying parent pays child support for.
You can work out what your liability would be with the child support calculator.
Our suggestion for a fairer formula
Where custody is not shared half and half have a set rate that is worked out on how much a kid costs to keep and split it between both parents, if one wants to pay more thats fine, but surely both parents are responsible for their children as well. The non custodial parent would pay for the days of the week they did not have their kids, minus the days they do. Lets say that a child costs 15 dollars a day for bare necessities…
In this example case we have two children, Jonathan and Kirsten and the mother is full time custodian, the father has for an average of 2 days per week.
The custody would be agreed at the beginning and
Jonathan + Kirsten cost per 7 days = $210
Father pays for 7 days at $210, mother credits back for 2 days at the cost $60.
Father – Mother = Father to pay Mother $150 per week.
This way you are actually rewarded for the time you spend with your child and this could be applied across the board.
It would not matter if you are not working or not earning much, if that was the case then you better take care of your kid half the time or else it’s going to cost you and if you can’t pay then the amount accumulates as a debt until you can.
We welcome your comments and stories about how child support affects you or someone you know from both sides of the custodial equation.