Child support system, Newstart push single mothers into poverty, Murray Bridge Soroptimists hear

A hole in the tax system and the low rate of Newstart are pushing some single mothers into poverty, a forum in Murray Bridge has heard.

About 40 people heard from federal Families and Social Services Minister Anne Ruston and National Council of Single Mothers chief executive officer Terese Edwards at the Soroptimist forum on Wednesday night.

Among them was a single mother who said she had been plunged into $1300 worth of debt because her children's father had not paid his child support or submitted a tax return.

Her Family Tax Benefit payments had been reduced because of the child support Centrelink had wrongly assumed she was getting, she said.

"I have three children and no stable income," she said.

"I'm living on this panicked edge: how am I going to pay my mortgage, how am I going to pay the next bill?

"The system is creating a cycle of legislated poverty in my children."

Senator Ruston agreed that one could "drive a truck through the loopholes" in the child support system.

She had recently directed a parliamentary committee to look into the issue, she said.

"The debt belongs to your partner," she said.

"Let's hold him responsible.

"I'm happy to take a look at that."

Ms Edwards also described the mum's predicament as "rubbish", and that the tax office needed to work harder to recover child support debts.

"I don't know why we don't go hard on these things," she said.

"It would change people's lives - we'd remove that sense of control that other person has.

Parents who paid child support should be required to lodge their tax returns on time each year, she said; child support payments should not be made to affect Family Tax Benefit; and financial institutions should take child support debts into account when they calculated people's credit ratings.

The system was "so fixable" but had been neglected for a long time, she said.

The low rate of Newstart was also a problem for single mothers, who were pushed onto the unemployment payment when their children turned eight, Ms Edwards said.

Mothers on the single parenting payment could earn $110 per week without affecting their payments, she said; but on Newstart the threshold was just $52.

"You're raising children, doing one of the most important jobs, and you're deemed to be unemployed," she said.

"We can do so much better."

Senator Ruston argued that increasing the rate of Newstart was a simplistic solution to challenging problems, especially when 35 per cent of taxpayer spending was on welfare.

"We can't just keep on adding money to this bucket, because we're not making a difference," she said.

"Giving (people) more money would do absolutely nothing ... probably all it would do is give drug dealers more money and give pubs more money.

"What we need to do is take a proactive approach to how we look at social welfare, look at social cohorts and what those cohorts need.

"We've got to be fair to the people who pay for it."

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