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CHILD SUPPORT PAYMENTS TO INCREASE

The Federal Government has recently announced an amendment to the Federal Child Support Guidelines that is to come into effect on May 1, 2006. The changes are important in two respects:

• Firstly, the amounts payable are going to be amended to reflect the current economic situation (it has, after all, been 9 years since the Guidelines were first passed) and
• Secondly, some new definitions regarding what constitutes extraordinary expenses will be included in the amendment.

The base child support amounts for payers in Alberta will see an increase overall. The rationale it appears is that tax rates have decreased since 1997 and living costs have increased. In general, people who earn less than $15,000.00 per year will pay less, whereas payers earning more than $15,000.00 will pay more. High-income earners will likely see the most substantial increase. For example, a payer who earns $12,000.00 and has one child, currently is obligated to pay $109.00 per month. Under the new Guidelines, the payer will be responsible to pay $74.00 per month. A payer, who earns $50,000.00 and has one child, currently pays base child support of $430.00 and under the new Guidelines will pay $425.00 per month. A payer, who earns $140,000.00 and has one child, currently pays $1,111.00 and under the new Guidelines will pay $1,225.00.

The second change to the Guidelines deals with what the definition of extraordinary expenses is. This definition is one of the most litigated matters in child support law and there is little consistency between the courts. The Federal Government is attempting by introducing this new definition to provide some consistency to what the courts should declare to be extraordinary expenses. The Government has directed a two-step approach to determine if the expense is extraordinary or not:

• First, extraordinary expenses are those that the recipient spouse cannot reasonably pay for taking into account their income and the amount of base child support being received; and
• Secondly, where the above does not apply, the court can then take into account the amount of the expense in relation to the recipient spouses income (including base child support being received), the nature and number of educational or extracurricular activities the child is involved in, any special needs or talents of the child, the overall cost of the activity or program and any other factor the court deems appropriate.

This definition follows what the courts in Manitoba have been applying for a few years. It appears to have provided some consistency, at least in approach, in that Province. Time will tell how the new definition will be applied in Alberta.

By Jim Glass
March 8, 2006