Child support change makes tight budget even tighter

Vanessa Runagall, pictured with her son Leon, 4, says her family is struggling to cope with the cost of living since the welfare changes. Photo / Brett Phibbs

A pregnant mother of two has been left with less than $300 a week to feed and clothe her family after a $50-a-week jump in the child support that her husband pays for another child.

The West Auckland family is one of many affected by a new formula for child support payments which came into force on April 1. Almost 33,000 liable parents will pay more under the new formula, 46,000 will pay less, and 58,000 are unaffected.

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Sunnyvale mother Vanessa Runagall said her family's budget was so tight that they simply couldn't pay an increase in her husband Ross' child support from $305 a month to $503.

"We were just managing," she said. "We changed our bank earlier in the year to get a good interest rate [on the mortgage], and they told us that with what my husband earned, that we couldn't live on that.

"We had to prove that we could live meanly ... We don't actually go anywhere, we don't actually do any entertaining."

Mr Runagall, a warehouse worker for Matua Valley Wines at Waimauku, has never missed a payment for his 13-year-old daughter since his previous relationship broke up 10 years ago. His daughter is in her mother's care and Mr Runagall sees her only occasionally.

He and Mrs Runagall have two sons Leon, aged 4, and Ethan, 2. Mrs Runagall cannot work because she cares for the two boys and is pregnant and due on July 3.

However, the family has been hit by a change in the child support formula which no longer gives Mr Runagall an allowance for his wife, on the assumption that she can work.

"I'm not considered as being a dependant," Mrs Runagall said.

"They are just assuming that everyone is a two-income household."

Mrs Runagall budgets the household income to the last cent, for example setting aside $21 a week for phone bills and $35 a week for power bills year-round. "In winter it goes up a lot, so if I don't save it in the summer we wouldn't cope," she said.

Including family tax credits and an accommodation supplement, the family's net income is $1031.71 a week.

Expenses include $337.09 for the mortgage, $100 a week in petrol for Mr Runagall's commute to Waimauku, $50 a week for other car expenses and, until recently, $76.23 a week for child support. Other costs such as rates, water bills and insurances left $348 a week for food, nappies, clothing, doctor's bills and other unpredictable expenses. From April 1, that balance has dropped to $298.

Mr Runagall has been assessed as earning 100 per cent of the combined "child support income" of himself and his former partner, who receives a sole parent benefit.

His first $503 payment is due on May 20.

"We are not paying it," Mrs Runagall said.

"I contacted Inland Revenue and said we couldn't afford to pay that and live."

Child support: what's changed

• Each parent is entitled to care costs for the number of days they have the children. Before April 1 shared care was disregarded unless each parent had the children at least 40 per cent of the time.

• Both parents' incomes are considered, not just the paying parent's income as before.

• Each parent can claim a personal living allowance of $17,687, plus an allowance for each dependent child which varies with the child's age and the parent's income.

• Previous allowances for new partners and their children have been scrapped.