Northland parents owe $62m in child maintenance

Northland parents owe $62m in child support payments

Northland parents owe more than $62 million in child support debt, with the majority penalties imposed for not paying on time.

As of June 30, the total owed by parents in Northland was $62,658,026. This included $48,659,229 in penalties.

Parents who fail to pay in full and on time incur an initial penalty of 10 per cent. A further two per cent of the unpaid amount is compounded each month the amount remains outstanding.

These penalties are retained by the Government and are not passed on to a receiving parent.

A significant portion was owed by men - $60,138,116, compared with $2,519,910 by women.

By comparison, in Bay of Plenty parents owed more than $48 million, Hawke's Bay parents $47 million, Rotorua $20 million, Wanganui $14 million and Wairarapa more than $12 million. Maureen Gwillim, of Whangarei Budgeting Service, said child support debt was a complex issue.

"It runs in with a whole lot of things. People come to us because their income doesn't meet their expenditure. Whatever they're in debt for, child support is just one part of it," she said.

"If they have earned income or get a benefit then child support comes out of that, so it's not something we generally deal with directly. But if there is a situation of debt, it can be tough; it hits both parents." Contacting Inland Revenue (IRD) directly or getting help from a budgeting service was the best way to deal with the debt, she said.

"The debt won't just go away, so there's no point in ignoring it. IRD isn't a scary place over the hill. They're very approachable and very helpful at making payment plans once people get in touch with them.

"There's also free budgeting services like ours, and Citizen Advice Bureaus in every town. We're here to help."

Nationally, $3,258,971,105 was owed in child support as of June 30. This included all parents residing in New Zealand and overseas. Men owed $3,045,344,357, while women owed $213,626,748. An Inland Revenue spokesman said while most parents paid their child support in full and on time, there were some who structured their affairs in an effort to avoid it.

"This can make collecting child support from these parents hard. However, Inland Revenue has processes to investigate complex financial arrangements and tax evasion, and can also initiate an administrative review if a parent's financial affairs don't appear to reflect their ability to provide financial support to their children."

The measures used by Inland Revenue to recover outstanding child support debt varied from case to case.

Legal proceedings were a last resort and, even after they had been started, if the parent made contact to restart negotiations, the proceedings could be put on hold.