Premature conversion to the new CSA scheme - A loophole that may thwart government policy
by Barry Pearson
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Case study 2: Fairly average examples with 2 or 3 children

These examples are based on a non-resident parent earning £200 net per week, with £50 per week housing costs. The cases are for 2 and 3 children respectively. (The 3-children case was shown earlier to illustrate the presentation style).

The background to these situations is described in Appendix B. Briefly, while the current scheme tends not to have a significantly different assessment however many children there are if the non-resident parent has a low to medium income, the new scheme has different liabilities for different numbers of children from quite a low income.

Reminder: the amounts shown are the differences between sticking to the government's transition plan, and forcing a new case to be started. The actually child support liabilities in each case are much higher than these amounts, of course.

With 2 children, this case is fairly marginal. Premature conversion does not offer much advantage for many "run of the mill" cases. (But it is still nearly £300 in total!)

Once there are 3 children, the effect is far greater. That is quite typical of the effect of this loophole. A far higher proportion of parents with the care of 3 children may try to exploit this loophole.

In this case, there is not only an advantage from premature conversion, but also an on-going advantage from bypassing the phasing-in.

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Page last updated: 12 December, 2003 © Copyright Barry Pearson 2003