Hon Peter Dunne
Minister of Revenue

31 October 2012 Media Statement

Minister welcomes progress of child support bill

Revenue Minister Peter Dunne has welcomed the Social Services Committee report to Parliament on the Child Support Amendment Bill, saying the Committee’s recommendation that the bill be passed, was “a step closer towards a fairer, more efficient scheme for the parents and children involved”.

The Child Support Amendment Bill proposes a range of changes to improve and update the child support scheme, including a new child support calculation formula to reflect parents’ levels of care arrangements, and updated payment, penalty and debt rules for child support.

The Committee has recommended that changes to the child support formula become effective from 1 April 2014 instead of 1 April 2013, as first proposed in the bill. It also recommended that the other changes that were originally due to become effective from 1 April 2014, become effective from 1 April 2015.

Mr Dunne said the Committee’s recommendation to defer for one year the introduction of measures in the bill was pragmatic and realistic.

“Really, it just takes into account legislative pressures and the timeframe that Inland Revenue would need to implement the changes in the bill.”

He said that despite concerns about the department’s computer system in the media recently, the proposed changes were well within its capability.

“The resourcing requirements to meet the changes have been factored into Inland Revenue’s existing work programme and are well within the capacity of its current computer system,” he said.

“Inland Revenue is confident that, in conjunction with its business transformation programme, the proposed child support changes can be delivered successfully, on time and within budget.”

The bill, which was introduced in October 2011, now awaits its second reading in Parliament.
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Questions and Answers:

Critics out there say that the $91 million cost is very high and the benefit do not justify that cost?

The $91 million is the cost over a 10-year period (and includes IT and operational costs). This has got to be seen in the context of this being the most significant change to the child support system in a generation. It has become dated and needs to be made fairer.

Yes, that will cost money to develop and implement, but it is money well spent. New Zealanders generally support the changes that will make the system fairer for all and help look after some of our most vulnerable children.

Critics are also suggesting that individuals are going to need accountants to deal with complex child support calculations.
Is this true?

This is political scaremongering. The new formula – which will be fairer and more reflective of the reality parents and families face today – will be calculated by Inland Revenue, as the existing formula is. Inland Revenue will also have online calculators for parents who wish to work out the numbers themselves.

Talk of people getting accountants is hysterical clap-trap.

ENDS

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