Child support or spousal maintenance?
Child support is often spousal maintenance in disguise, says Terry Quinane.
The so-called child support scheme goes well beyond supporting the child - payments are often much higher than the actual costs and the surplus is spent by the custodial spouse. This means that child support is often spousal maintence in disguise.
The child support formula, based on a percentage of gross income, often amounts to far more than the real child-related costs. For example, if you have three non-custodial children, the mother is unemployed, and you earn $70,000 p.a. you would be paying $6,500 per annum per child. However a child has a baseline of needs. I believe that the figure cannot be more than $3,000 per annum for a single or the first child, and it is crazy to suggest that the cost of caring for the child is related to how much the paying parent earns.
The Family Court uses the "Lee Figure" as the total cost of maintaining a child. The Lee Figure is an estimate of the cost of maintaining a child in a single parent, single income family where the parent earns the equivalent of average weekly earnings. The Lee research purports to demonstrate that in this family situation, one third of the costs or about $270.00 per week ($14,040 p.a.) are attributable to the child.
While the Family Court is quite happy to accept the Lee research as a "reasonable" measure of the cost of children, it ignores the other side of the findings; that is in this family situation, 2/3 of the costs incurred by the family or $540.00 per week ($28,080 pa) are attributable to the adult. If the Family Court intends to use the Lee research as a guide to the costs of children then they must also acknowledge the amount required by an adult to maintain him or herself.
The Government currently provides a student on Austudy with $7000 pa to live on. If we say that this is a reasonable figure to cover the living expenses of an adult and apply the ratio of child to adult expenses of the Lee research (that is 1:3), then $2,335.00 pa or $44.90 per week would be a reasonable amount for child support payments.
The Lee research states that two children only cost about 1.5 times the expenses of one child and 3 children cost about 1.9 times that of one. These findings should be applied in cases where child support is payable for more than one child.
To err on the side of generosity, a maximum ceiling of say $3000 per annum could be set, with a decreasing scale based on what can be paid.
It must also be remembered that non-custodial parents also face extra payments because they must provide accommodation suitable for their children even though some rooms are empty for most of the time.
Taking the case of three children and an income of $70,000 the non-custodial parent pays $19,500 in child support and $24,500 in tax (child support is not deductable) leaving net income of $26,000 p.a. The custodial parent receives your $19,500 plus $7,500 family payment and $9,000 sole parent pension, $10,000 more than the fulltime working non-custodial parent.
Sole parent pensions
Research shows that approximately 40% of children from two parent families regularly are minded in day care. The Family Court must accept that there is no longer a "homekeeper" in Australian families. There are plenty of widows/widowers and custodial parents who are in full time employment. Once children are old enough to attend school, what is stopping the parent from participating in the workforce?
The current sole custody and child support regimes are fiercely defended by custodial parents who want to ensure that their "cash kids" lifestyle is preserved and paid for through Government benefits and child support. But they will struggle when you ask them how preservation of the current system is in the best interests of children and the country!
I would not ordinarily get into a debate about sole parent's pensions; however, as a condition of receiving these benefits, the Government stipulates that recipients must hunt down, harass and intimidate the ex-partner into paying for a situation that has resulted in the removal of this parent and extended family from his/her child's life - sole custody.
In cases of sole custody, wherever the sole parent enters into a defacto relationship or remarries, all child support payments should cease. The new partner who takes on a step-father role to your children should also take on the financial responsibilities, as if they were his own. In joint custody situations payments or non-payments should go on as normal.
Terry Quinane is the Child Support spokesman for the Society for the Best Interests of the Child.
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