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Non-blended family vs blended family

A "non-blended family" can not get the neighbour or someone to pay extra into their income supplement, so why should a "blended family" under CSA legsilation?

An open letter asking for discussion on blended family payments vs normal family payments.

28 December 2008
Melissa Robinson
Open Letter

Ministerial request for change to Child Support Legislation/Policy

Dear Sir/Madam,

We write to you in your capacity as both a CSNSEG member organisation and as a potentially interested party in pushing a change to a morally unfair section of the new child support assessment.

We ask that you read our letter and consider backing our call to have this section changed, or at least, be open to discussion around this being investigated further.

We have prepared and sent a Ministerial letter to The Hon Jenny Macklin, The Hon Tony Abbott, The Hon Kevin Rudd and the Hon Malcolm Turbull, requesting a change to the current child support legislation so that if an individual chooses to reduce their income to stay at home and care for a new child they are not paying less or receiving more child support from their ex to fund this choice.

As we have tried to explain a "non-separated or non-blended family" has to work out their budget when a new child comes into the home calculating what is coming in at that time and the cost of the household including any other children already there.

For example:

Hubby's income $40,000
Wife's income $40,000
Supplement $5,000

Now if they have another child and the mother chooses to take a year off at half pay their income is as follows:

Hubby's income $40,000
Wife's income $20,000
Supplement $5,000

But if a "blended family" is in the same situation they can be supplemented for their choice by the ex-partner as follows:

Hubby's income $40,000
Wife's income $20,000
Supplement $15,000 (through additional child support)

A "non-blended family" can not get the neighbour or someone to pay extra into their income supplement, so why should a "blended family"?

We know this is a sensitive issue and not everyone agrees, and we accept that and understand, but we do not believe that in this situation an ex-partner should pay extra. As we have detailed in the letter, if a person looses their job or is ill these are reasons they can not help and have not foreseen, and it is fair that the same level of child support as per the assessment is paid, meaning that in these situations it would be fair to have the ex-partner pay a higher sum.

But we do not believe it is fair to have to pay extra when your ex chooses to have a child with a new person. They should either choose to take time off at a reduced pay rate without extra from their ex, or only take what time off they have available at full pay, if any.

Again, we know there are many different trains of thought around this, and it won't work for everyone, but we believe it is reasonable for the majority.

We have approached some other blended families and asked them to also send similar letters to the Ministers if they agree. If you agree with us would you consider also writing to them to raise this issue or to highlight this as a change of policy/legislation?

We look forward to hearing your thoughts and opinions.

Our letter is as follows:

Proposed Change to Child Support Policy / Legislation

We wish to propose a change to the current child support policy and legislation. This is an issue that should have been closed during the recent reforms but has not been dealt with and is a major concern to thousands of families around Australia.

For many years parents have complained that they have had to  pay for their ex partner to have a child with a new partner. This happens as the payee (generally a mother) has a baby with their new partner and due to their arrangements around having time off with the new baby the child support assessment for the ex-partner increases to cover the loss of income by the other parent.

Most parents would have no concern in paying higher child support payments if the ex-partner genuinely looses their job due to cutbacks or other reasons, has reduction or loss of income due to illness or other unforseen circumstances.

However, in the case where a parent has a child with a new partner, chooses to reduce their income to take time off to care for the new child this should not increase the child support assessment for their ex, or decrease the amount they might be paying in child support based on their income.

If a couple decide to have a child then they should arrange their finances as a couple to pay for that child and the children already within their family circle without anticipating additional payment from the ex-partner to fund that time off. Exactly the same way a  non-blended family would have to do.

I realise that in the new reforms this issue was considered and dealt with to the effect that non-custodial parents or payers, are now able to estimate a reduction in their income due to them staying at home to care for a child. So it has now be made equally available to both payer and payee where prior to the reforms it was not possible, except in extreme cases, for a payer to  voluntarily reduce their income even if it was to care for a child.

Our argument is that this should not apply to either party.

The reforms were made to ensure to  better balance the interests of both parents and be more focused on the needs and costs of children .

Then where is the focus on the needs and costs of children from non-separated parents? In a  non-blended family situation when they choose to have a family they arrange their finances around what they have coming in at that time and what will come to them via the baby bonus, family tax benefit etc, they do not have access to additional income from an ex-partner to pay for their life choice. Why should blended families have the additional income?

While the rhetoric is that you are trying to ensure the costs of the children are met even if one parent suddenly finds their income lower, it is not morally  fair to expect in all bluntness to have a person pay their ex to have a child with a new partner. As detailed above if a payer has to increase their payments as the ex-partner has a reduction in income due to illness etc these are things they do not have a choice about and should not affect the children as much as possible.

It seems unfair that the payer has to pay more because of a decision the ex and their new partner has made about their life.

When you decide to have a child you should be able to support it yourself on the income you have coming in now, you shouldn t get more money from an ex-partner because of your choice.

In many cases the parent taking the reduction in income is due to their choice to take maternity leave and possibly other leave, such as personal, long service etc at a half pay rate, or to also include some leave without pay. Should it not be considered fair that especially if they have access to this leave then they should not be considered on half pay, for child support purposes, as this is their choice.

Parents receive the baby bonus, they may be entitled to a higher rate of family tax benefit due to the reduction in income, there could be other financial entitlements available to them, but then they also get more money from their ex to fund their life choice.

I ask that you urgently rescind this part of the child support assessment process altogether. There should not be a financial gain for a person from their ex when they choose to have a child with a new partner.

I look forward to your response in the near future.

Regards,

Anthony and Melissa Robinson

Executive Secretary - Shared Parenting Council of Australia
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Secretary_SPCA,
                       although the theory behind the consideration is sound, I don't think that the underlying figures are as sound, which leaves room for this to be argued against based upon figures. I'd think that some would argue that they are alarmist. Perhaps I have misunderstood what has been put forward though.

I've run a few scenarios based upon my understanding and here's the results :-

a) Income of parent paying CS $50,000 with below regular care of a single child and the income of other parent as $40000 results in CS of $5014.
b) If the receiving parent has a child and the blended family is formed without any income reduction then CS changes to $5039.
c) If the receiving parent reduces their income to $20000 then CS becomes $5225.
d) If  the receiving parent reduces their an effectively $0 income (i.e. $18808 or less) then the CS becomes $5243.

A scenario maximum change of $229 over a year.

If the income of the paying parent is raised to about the highest it can be, $180,000, and the receiving parents income changes as the previous set of examples then :-

a) would be a CS figure of $15209.
b) results in a CS figure of $15516.
c) becomes $17104.
d) becomes $17209.

A scenario maximum change of $2000 over a year.

If the initial scenario, based on $50,000/$40,000 incomes, is run with 3 children who are 13 or over then :-
a) would be $9837.
b) would be $9849.
c) would be $9945.
d) would be $9951.

A scenario maximum change of $114 over a year

Note all results are annual amounts and are based upon 2009 figures.
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