Changes to child support payments hurt couple

Daniel and Paige Moulden, parents of a three-month-old baby, have been hit hard by child support changes.

New formula means many parents will have to pay more to support children from previous relationships

A Ngaruawahia couple with a three-month-old baby face losing their house because the dad has been hit with an increase in child support payments of $44 a week.

Daniel Moulden, 30, and his wife Paige, 20, bought their house for $280,000 four months ago, just before their baby son Eli was born in January.

They calculated that they could just meet the house payments of $420 a week out of their combined net income of $1068 a week after deducting $82.50 a week which Mr Moulden was paying in child support for his three other children aged 11, 9 and 4.

Then the child support formula changed. From April 1, Mr Moulden must now pay $126.30 a week.

"At the moment, we are pushing other bills away so that we can keep the house," he said.

"But if you push a bill away, it just doubles the next week, so we are pretty much looking at we might have to give it up."

Mr Moulden is one of 33,000 liable parents whose child support payments have gone up under the new formula. A further 46,000 will pay less and 58,000 are unaffected.

An Inland Revenue spokeswoman said 1,138 applications for reviews of the new payments were still waiting for decisions.

The Herald has received emails from 29 liable parents or their new partners, all struggling to pay the new rates, since pregnant mother Vanessa Runagall spoke out on Wednesday about the impact of her husband's higher child support payments on her and their two children.

Two others emailed in support of the new formula, which allocates costs based on both parents' incomes and how many days a child spends with each parent. The previous formula was based on the liable parent's income and did not recognise time the child spent with that parent unless it was at least 40 per cent of the child's time.

The main criticisms of the new formula are that it no longer allows for the costs of a liable parent's new partner and any stepchildren, and conversely does not count the income of a custodial parent's new partner.

In one blended family where the husband earned $85,000 a year, his child support payments for two children have gone up from $1,000 a month to $1700, while the wife receives only $140 a month for her child because her ex-partner is on a minimal income.

"What's so different between children?" she asked.

She has responded by getting a new job with the chance of overtime at higher pay.

"I'm going to go out and make the money because he gets assessed on everything," she said.

Mr Moulden, like the husband in that family, tries to avoid overtime in his job as a switchboard builder.

"I've been doing 40-hour weeks because the problem is if I work overtime, the next financial year they sting me even more," he said.

Good and bad

• Good news: The new child support formula counts the incomes of both parents and the days children spend with each parent.

• Bad news: Allowances for liable parents' new partners and step-children have been abolished.