Child Support Lessons from Canada: A Different Approach for Parents with Low Incomes

Author: Susan Stanton . Date: March 17, 2017

The Waterloo Region of Ontario recently made some key changes related to child support policy as part of a larger poverty reduction strategy. These statutory changes apparently reflect an income support goal on the part of Waterloo policymakers. Those changes include one approach already used in the United States and one that should be considered by policymakers here to support families in their efforts to move toward economic security:

1-no longer deducting child support as income from benefit checks received through social assistance and

2-no longer requiring the pursuit of child support as an eligibility requirement for social assistance.

In part, these changes are grounded in the understanding that noncustodial parents are more likely to pay child support when they know that the money will go directly to benefit their children. Also, it seems that policy makers in Waterloo have come to recognize that custodial parents who are eligible for government assistance also need the total amount of any cash contribution their co-parents make.

Child support and public assistance philosophies, policies and practices in the United States play out differently. Under federal law, Temporary Assistance to Needy Families (TANF) eligibility requires parents to “cooperate” with the state child support agency in establishing orders for paternity and child support child (Sec. 454. [42 U.S.C. 654] of the Social Security Act).  This federal policy requires TANF (and other social service) applicants, to assist the state in establishing and enforcing orders by: naming the likely noncustodial parents, providing contact information, participating in genetic testing, appearing in court as a witness, handing over to the state any cash received by the custodial parent from a noncustodial parent in arrears, and performing other activities that-in the discretion of the agency-assist in enforcement of the child support order. Currently, in the Unites States, cooperation with the child support enforcement agency is required for TANF and Medicaid benefits. While there is not a federal requirement for the , the Food Stamp Program (FSP) or Child Care Development Block Grant (CCDBG) assistance, many states require child support cooperation to access or receive full benefits from those programs.

Given that there are parents that willfully and intentionally don’t pay child support, it is reasonable to assume that cooperating with the child support enforcement agency is in the best interest of children,  custodial parents and noncustodial parents, but oftentimes, that isn’t the case. For example, we recently heard from a custodial parent who was scheduled to be in court as part of paternity establishment and her baby woke up during the night with an ear infection and all the associated challenges. The custodial parent could not get through on the telephone to her local child support enforcement agency to let them know she wouldn’t be in court that day. Because she failed to appear in court, the agency labelled the custodial parent as “non-cooperative” which resulted in the custodial parent losing her Medicaid insurance benefit and getting sanctioned by TANF (which means less cash). A noncustodial parent recently shared that he was ordered to court for a child support hearing on a day he was scheduled to work at his new job. Consequently, he was forced to choose between skipping work and losing the job the court ordered him to find or skipping court which is a violation of the child support cooperation requirement, and risk being found in contempt, serving jail time, thereby losing his job.  For that father, cooperating with the child support enforcement agency did not help him positively contribute to his child’s life. Those examples highlight a few of the ways that practical application of the child support cooperation requirement disrupts and detracts from the efforts of many families with low-incomes and employment instability to care for themselves and their children. Linking child support cooperation to social assistance programs can have the impact of taking economic resources from the children and families with the greatest need, denying services to children and parents that programs are supposed to serve, creating debt and furthering economic instability for custodial parents, non-custodial parents and their families and communities. In other words, in the United States, cooperating with the state child support enforcement agency can disrupt the stability of low-income families and not cooperating can have dire impacts as well.

It is estimated that the Waterloo Region of Ontario, Canada will put an extra $75 million a year into the pockets of parents with low incomes which increases the likelihood that child support will be paid to custodial parents by not deducting child support from noncustodial parents’ social assistance checks and by not requiring child support cooperation to receive social assistance. These efforts to change policies which create and/or perpetuate the cycle of poverty might just help custodial parents, noncustodial parents and their children move toward economic security.

Child support cooperation is a far-reaching policy in the United States that undermines the economic security of low-incomes families at every turn. This is the first piece in a series on child support cooperation policy and practice.

Wisconsin Works for Some

Author: Susan Stanton . Date: February 8, 2017

In his budget, to be released this week, Wisconsin’s Governor Scott Walker is expected to roll out Wisconsin Works for Everyone, a plan which will further aspects of the state’s Temporary Assistance for Needy Families (TANF) program also known as W-2 or Wisconsin Works. Self-sufficiency is the stated goal of the Wisconsin Works for Everyone proposal, which seems to mean not utilizing safety net services to care for one’s self or family. It makes sense for the state to want adults and parents to provide for themselves and their children financially. Of course, most parents want the same thing.

A fundamental component of Governor Walker’s proposal would require able-bodied parents whose children are ages 6-18 and who receive FoodShare benefits (aka food stamps, SNAP, QUEST card) and/or housing subsidies to work 80 hours per month and if that goal is not met, to impose sanctions and ultimately, revoke the benefit. In April 2015, Wisconsin created a similar FoodShare requirement for so-called “childless adults” which include the majority of typical low-income noncustodial parents. Since then, about 21,000 Wisconsin residents using food stamps have met W-2’s employment requirement through state employment programs. But here’s the catch: 64,000 FoodShare recipients lost benefits entirely. This means that for every one FoodShare recipient who has met the 80-hour-per-month requirement, three have not, and all three have lost access to this piece of the safety net as a result. Essentially, the new proposal would expand a requirement for a benefit intended to provide food for children and adults, a requirement that has succeeded for just 1 in 4 people in a pilot program, hardly a success. It would now include even more adults, parents and children in need.

Many of these marginalized parents already feel additional burdens around work, money, housing and feeding their children. While the Governor indicates that there will be more supports to help FoodShare recipients find jobs, low-income parents of color continue to face many employment and housing challenges in seeking self-sufficiency. Self-sufficiency can remain out of reach for a multitude of reasons: lack of transportation, limited access to affordable, geographically reasonable, and safe child care; racial discrimination; access to affordable housing;  inconsistent work schedules; low wages and jobs with no benefits, among others. These challenges affect low-income parents’ ability to find and keep any job, much less a job with a living wage or a career ladder.

Yet even if low-income noncustodial parents successfully navigate and endure these challenges and manage to obtain and retain work, they might receive a paycheck reflecting substantially less than 40% of their earned wages. When reviewing a paystub, many low-income noncustodial parents see common deductions like Social Security and a monthly child support payment, but many also have deductions for arrears and By federal law, the state can deduct up to 60% from a noncustodial parent’s paycheck for the current payment and for arrears. The remainder might not be enough to allow for self-sufficiency, much less to help families move toward economic security or even income stability. If child support payments are not made regularly, many noncustodial parents are at risk of going to jail and will in that case likely lose their jobs, while child support arrears often continue to accrue.  Whether they work more or less than 80 hours per month, these parents and children need access to safety net services including food and housing.

It is also important to note that, for the poorest families who have ever received cash benefits from the state, the state deducts a portion of the payment to reimburse state welfare payments to the family. According to the Office of Child Support Enforcement, as of 2015, child support debt in Wisconsin totaled $2.6 billion. Approximately 17%, or $449 million, of that was owed by families with the lowest incomes to the government to repay W-2 benefits. Wisconsin Works for Everyone purports to incentivize work and is touted for its intention to reward working families and move families out of poverty. Yet, for the families with the greatest financial needs, it appears that they are simply being ‘helped” to pay the state money the parents and children can ill afford.

Reforming the welfare system is necessary to ensure that Wisconsin works for everyone. But effective reforms will focus on changing policies and practices to help ensure that low-income fathers and mothers (regardless of whether they live in the same residence as their children) will be able to provide for their children. Creating more requirements rooted in an inaccurate perception that low-income parents do not want to take care of their children simply ensures that they won’t be able to do so. In fact, expanding the requirements for FoodShare recipients and shrinking the safety net that already fails to effectively support childless adults ensures that Wisconsin will increase its numbers of homeless adults and children who are not getting the nutrition they need.