Case studies - faults in "shared care" in the reformed scheme

Case Studies - anomalies in the reformed shared-care formula
1	Two separated parents earn the same and share care 4:3. The NRP becomes far worse off than the PWC, and would be much better off never seeing the child.
2	Two rich parents share care equally. The person claiming Child Benefit is encouraged to use the CSA to obtain an unfair stream of money from the NRP.
3	The NRP is on benefits and the PWC earns. The NRP is financially abandoned by the state and the other parent while caring for the child.
4	Both parents earn the same low pay and share care equally. The parent claiming Child Benefit can also claim WFTC and childcare tax credits. The state bribes the NRP never to see the children.
5	Like "1", but they earn a little more and share care 5:2, with similar results.
6	Both parents are on benefits and share care. Only the PWC gets help from the state for the child.
7	This shows the totally unexplained difference between the way the CSA White Paper deals with equal split care and with equal shared care of two children.

Case Study 5

The situation

Both parents earn £250 net per week, a low-to-middle income.

The PWC looks after their son for 5 nights per week, the other parent for 2 nights per week.

In total, they spend £80 per week on their son, perhaps a little higher than average.

The result

The PWC only spends £10.60 from her earned income on their son, because:

She receives all the Child Benefit (even when she doesn't have their son).
She receives Child Support of £27 per week.
She doesn't make any contribution for the time when the other parent is catering for their son (and neither does the state).

The NRP spends £55 per week on their son from his earned income.

The child has £52 spent on him while in the PWC's household and £28 while in the NRP's household. This suggests that child support should be about £12 to balance the amount spent. (This still leaves the benefit bias). In fact, at £27 it overcompensates significantly.

With the Fair Shares formula the child support becomes about £10 - £11. This still leaves the PWC better off because of the Child Benefit.

This is an HTML transcription of an article written in September 1999, hence the benefits rates, the references to the White Paper, etc.

Page last updated: 5 July, 2004