The Rewrite Bill proposes to re-enact section 70A which provides for the reduction of a sole parents benefit

for failing to assist child support

The reduction is $22 per child, with an additional $6 reduction per client 13 weeks after the initial reduction.

Why are we looking at this issue now? What is the policy intent? Are clients meeting their child What do we know about these 13,616 clients?
To
Toencourage
encouragethe theother
otherparent
parent(usually
(usuallythe
thefather)
father)to
to support obligations?
Many submitters urged the repeal of section 70A: contribute
contribute to the cost of raising their child. Theway
to the cost of raising their child. The wayto to 17,087 Children in Total:
achieve
achievethis
thisisisto
toencourage
encouragesole soleparent
parentbeneficiaries
beneficiariesto to
1 Child 80% 2+ Children 20%
establish
establishpaternity
paternityand andapply
applyfor
forchild
childsupport
support 4%
Repeal Section Many women arent The Exempt
Thepolicy
policyplaces
placesresponsibility
responsibilityononsole
soleparent
parent
70A - 49 even aware that they beneficiaries Predominantly Maori:
beneficiaries to ensure the other parentof
to ensure the other parent ofthe
thechild
childisis
have a reduction or identified in law, and to apply for child support Pacific Other
identified in law, and to apply for child support 18% Maori 53% NZ European 25%
Island 14% 8%
that there are possible
exemptions These
Theseresponsibilities
responsibilitiesare areplaced
placedononthe
theperson
personwith
withmost
most Not meeting
Other knowledge
knowledgeof ofthe
thecircumstances
circumstancesininwhich
whichthethechild
childwas
was obligations Younger:
Submissions - conceived,
conceived,and
andwho whowillwillbenefit
benefitfrom
fromthethefuture
futurecollection
collection 18-34 70% 35-54 29%
72 of
ofchild
childsupport
support(there
(therearearealso
alsobenefits
benefitsforforthe
thechild
childfrom
from
having the father named eg health reasons)
having the father named eg health reasons) Almost all on Sole Parent Support:
78% JS
What
Whatare
arethe
theexemptions?
exemptions? Meeting Child Support
SPS 94%
6%
Financial stress pushes Case managers are not well
there Obligations
people back into abusive trained to deal with thereisisinsufficient
insufficientevidence
evidenceavailable
availableto
toestablish
establishwho
whoisis
relationships, and this exemptions, as it means ininlaw the other parent
law the other parent
policy contributes to the
discussing issues such as the theclient
clientisistaking
takingactive
activesteps
stepstotoidentify
identifythe
theother
otherparent
parent Does the reduction increase hardship?
financial stress threat of violence, or incest there is a risk of violence if child support is pursued
there is a risk of violence if child support is pursued
there
therearearecompelling
compellingcircumstances
circumstances These clients are no more likely to access hardship assistance than
there
there is noreal
is no reallikelihood
likelihoodof ofChild
ChildSupport
Supportbeing
beingcollected
collected other sole parent beneficiaries
the
the child is conceived as a result of incest orsexual
child is conceived as a result of incest or sexual Sole parent families in general have the lowest living standards of all
Total number of sole parents = 77,025
violation.
violation. family types in New Zealand.
These clients are likely to be at higher risk of long-term benefit receipt
compared to other people on Sole Parent Support
Has benefit policy linked to Child Support been a Sole parents who did not meet the maintenance requirements An additional reduction of $6pw (per family) The current reduction is $22-28 per week, higher than the $17.20
were made eligible for the DPB. The DPB was paid at a reduced was applied when a beneficiary had had a $22 minimum Child Support that liable parents are required to pay
long-standing part of the welfare system? rate with exemptions to the reduction. reduction applied for 13 week

1938 1973 1981 1987 1990 1993 2005 2016

How much child support did the Crown retain to

A person could not get a
benefit unless they applied
for a maintenance order
DPB was introduced,
applications could be
declined for failure to apply
for maintenance
From 1 April 1981, an applicant became
entitled to DPB if they could identify in law
the other parent of each dependent child
in their care.
Section 70A of the Social Security Act 1964 was introduced in The provisions are included
1990. It extended the benefit reduction for not applying for child
Benefit reduction increased
to $22 (same as Family in the Social Security offset benefit costs in 2016?
support to sole parents in receipt of income-tested benefits other Support rate for second child) Legislation Rewrite Bill
which is currently before
than the DPB.
the select committee
$186,515,979 from 139,248 liable parents

What does the client experience look like?
Contact
Part of the
appointment process
for sole parents is a
discussion about child
support obligations
Appointments occur in
open plan Work and
Income offices with the
option of private rooms
Inform
Clients are informed
about the policy and
situations where an
application for child
support isnt required
Listen
If the client reveals
information that means
they are exempt from
the obligation to apply
for Child Support.
Follow Up
If the clients benefit is
reduced, the client is
sent a letter confirming
that their benefit has
been reduced and why.
A series of letters are
sent that include
information on the
exemptions to the
reduction, review
rights, information
about the additional $6
reduction after 13
weeks.
What do we know about the effectiveness of the reduction?
The effectiveness of the benefit reduction is unclear but increased support through a package of
information, support and an early intervention programme (EIP) between 2004-2008 had a positive
impact on reducing reductions.
Following the increase in support, the additional $6 benefit reduction was introduced in 2005. No
evaluations have been conducted on the increased reductions effectiveness. It is not possible to
isolate the effect of individual components of the package.
Evaluation of the EIP showed it was successful, and identified lack of knowledge amongst clients and
case managers as a problem - the most common reasons given for not applying for child support
were that the other parent denies paternity, the other parent cannot be found, or the sole parent
did not want the other parent to have guardianship rights over the child. MSD research prior to 2005
concluded that beneficiaries subject to the benefit reduction became accustomed to living within a
reduced benefit.
In 2005, there was evidence that clients did not understand the policy and submitters say this is still
the case. Submitters noted Work and Income does not provide the most appropriate environment
for discussing exemptions. The number of exemptions granted has increased every year since 2006.

We require better information and The current section 70A Some options that could be considered with better Report back with a timeline and
What are we
evidence to make a recommendation on reduction and exemptions be information include removing the reduction, or process for gathering better
recommending? the effectiveness of this policy or other retained in the Social Security modifying it by changing the amount of the reduction, information to identify and assess
options to achieve the intent Legislation Rewrite Bill and/or time-limiting the reduction options and inform policy decisions