[IN CONFIDENCE RELEASE EXTERNAL]
20 August 2020
[FYI request #13369 email]
Dear Mr Kern
Thank you for your request made under the Official Information Act 1982 (OIA), received
on 23 July 2020. You asked:
What policy (Legislation, executive orders, management letters) does the department rely
on in their actions to act in every possible way to increase child support payments to the
level of inability to pay and profiting on penalty payments at the cost of broken families?
You made the following comments:
I have an FOI request arising from "Briefing for the incoming minister of revenue" dated
Oct 2017 and specifically the statement "Child support: we collected $468 million from over
166,000 liable parents who pay child support, and distributed $279 million to carers." (…)
So it is $279m distributed to parents while having $855m of penalties issued for $189m
crown profit, meaning each family that got into this system pays close to twice as much
under threat of several times multiplied penalties.
The policy for child support assessments and penalties
Child support is assessed and collected under the legislatively fixed standards in the Child
Support Act 1991 (CSA). You can read the CSA online at http://www.legislation.govt.nz.
The legislation that allows Inland Revenue to charge penalties is in Part 8, section 134 of
the CSA, Penalties for late payment of financial support debts.
The link to this section is:
Proposal to repeal child support incremental penalties
You may be interested to know that a repeal of child support incremental penalties has
been proposed. A Supplementary Order Paper (SOP) to the Child Support Amendment Bill
was released by the Minister of Revenue, Hon Stuart Nash, on 9 July 2020. The proposed
changes in the SOP would repeal child support incremental penalties and simplify the
penalty write-off provisions. The changes would apply from 1 April 2021.
You can read about the proposals, and about the Child Support Amendment Bill, on Inland
Revenue’s Tax Policy website at: http://taxpolicy.ird.govt.nz/news/2020-07-09-repeal-
[IN CONFIDENCE RELEASE EXTERNAL]
The balance between what Inland Revenue collects and distributes is partly penalties and
partly the amount that is retained by the Crown to help offset the cost of benefits.
Inland Revenue wrote off $244 million of liable parent child support debt in the 2018-19
year. This information is available in our 2019 Annual Report.
Our Annual Reports
yearly information about the collection of child support. You can read our Annual Reports
on our website at: https://www.ird.govt.nz/about-us/publications/annual-corporate-
Background to child support
The standard child support formula assessment is set out in section 30 of the CSA. The
formula is based on the percentage of the combined income of the parents, the amount of
care provided by the parents when that care is 28% or more of the time, and the child
expenditure amount. The components of the formula used to assess child support are fixed
Applying to change the child support formula assessment
If a parent believes that there are special circumstances that their child support formula
assessment should account for, they can apply for an administrative review under section
96B of the CSA. Information about administrative reviews is on our website at:
The information in all the links is refused under section 18(d) of the OIA, as it is publicly
Right of review
If you disagree with my decision on your OIA request, you can ask an Inland Revenue
review officer to review my decision. To ask for an internal review, please email the
Commissioner of Inland Revenue at: [email address].
Alternatively, under section 28(3) of the OIA, you have the right to ask the Ombudsman
to investigate my decision. You can contact the Office of the Ombudsman at:
Thank you for your request. I trust the information provided is of assistance to you.
Sue Gillies Customer Segment Lead—Families