Microsimulation & Econometric Data Analysis

The coalition agreement for the 20th legislative period called for a reform of the child support law. As a result, two years ago, the Federal Ministry of Justice presented a draft law to restructure child support for parents who share the care of their children to a greater extent after separation. The aim was to reduce their child support burden. On behalf of the Federal Ministry for Family Affairs, Fraunhofer FIT analyzed changes in child support payments and their effects on social benefits in individual case calculations.

The proportion of separated families in Germany is considerable. In 2023, for example, 1.7 million single parents lived together with minor children – one in five families. The majority of separated parents practice the so-called residence model – the child lives mainly with one parent, who provides support in kind, while the other parent compensates in the form of monetary payments, i.e., is obliged to pay child support. In the typical residence model, the non-resident parent cares for the child for two days every other week and half of the holidays. The amount of child support payable is determined in child support tables and guidelines – these depend on the net income of the non-resident parent, the age and number of children, and the amount of child benefit.

In an estimated 4-7 percent of cases, the symmetrical shared care model is practiced, i.e. the parents share the care of the child approximately 50/50 and both are considered to be liable for cash child support.

The proportion of those who share care more than in the residential model, but less than half of the time, is about the same. This substantial shared care was previously taken into account by the courts in reducing payments under the child support guidelines. As part of the reform project, a new calculation model was to be introduced, as this practice was considered insufficient.

The purpose of our assignment was to determine the changes in payments resulting from the new calculation formula for a variety of individual case scenarios. Since both the payment and the receipt of child support affect the amount of unemployment benefit II, child supplement, and housing benefit, the impact of the bill on low-income separated families was quantified. The interactions with other planned reforms – the guaranteed child allowance and the tax treatment of single parents – were also calculated.

The proposed reform has not been enacted. The legal debate on the shared parenting model is likely to continue.