Speaking to Sowetan on Thursday, the executive director of Social Justice Foundation Anneke Greyvenstein said they have picked up that 70% of those with maintenance obligations default in the first two years. “Parents do not disclose that they have a maintenance obligation, but now it is going to reflect on your credit profile and the credit provider must take this into consideration when they do the affordability assessment and see if you qualify to buy.”
She added this was not going to happen immediately a as they would need to build a database and educate the public. “This initiative started in 2006. We lobbied for legislative reforms, and in 2015 the NCR [National Credit Regulator] regulations and the Maintenance Act were amended. Maintenance obligations must now form part of affordability assessments and maintenance defaulters must be reported to credit bureaus.”
She said it was worrying that the defaulters would complain to courts that they did not have money to pay for maintenance because they had other obligations such as paying for their vehicles and homes.
“With this partnership there will be a bridge between what is happening in our family court and what is happening in the credit industry so that we can start looking after our next generation,” Greyvenstein said.
“If there is a maintenance obligation, it is going to reflect on the credit record, and when one applies for credit for a new car or a new home or even to increase their clothing account, what should happen is that the person won't get credit if they are not paying for maintenance.”
She said the foundation will be working with parents and the courts to collect information on those who have maintenance obligations. She said the information will only be available to the credit bureau and not to the public.
Meanwhile, Felicity Guest, founder of Child Maintenance Difficulties SA, said while she welcomes the blacklisting of defaulters, she does not agree with a private company owning the data.
“What was proposed is that this will be done by a private company who is subcontracted to a particular credit bureau and the people who own the data will be this private company. I haven't seen the memorandum, but I have listened to their proposal and I watched this develop.”
SowetanLIVE
Pay for your kids or face blacklisting
Govt plans to send names, details to credit bureaus
Image: 123rf
With 70% of parents defaulting on child maintenance in the first two years of the court order, the department of justice and the Social Justice Foundation is going ahead with the plan to blacklist defaulters with credit bureaus.
The entities are expected to sign a memorandum of understand (MOU) today to have defaulting parents blacklisted. The move will take some time to go into full effect as the state develops a system to facilitate it.
The department said on Thursday that the signing of the MOU marked the “commencement of a groundbreaking epoch where the department will develop a system to facilitate the forwarding of the details of persons against whom child maintenance enforcement orders have been granted to a partner credit bureau who will in turn make this information available to all other credit bureaus and credit providers,” the department said in a statement.
The department said this will result in defaulters’ ability to get access to credit being affected. This move is aimed at implementing the provisions of the Maintenance Act as amended.
“Both the civil and the criminal provisions of the act have provisions which requires the forwarding of personal details of the maintenance defaulters who fail to pay child maintenance and have enforcement order judgments against them to the credit bureaus and credit providers,” said minister Thembisile Simelane's spokesperson Tsekiso Machike.
Speaking to Sowetan on Thursday, the executive director of Social Justice Foundation Anneke Greyvenstein said they have picked up that 70% of those with maintenance obligations default in the first two years. “Parents do not disclose that they have a maintenance obligation, but now it is going to reflect on your credit profile and the credit provider must take this into consideration when they do the affordability assessment and see if you qualify to buy.”
She added this was not going to happen immediately a as they would need to build a database and educate the public. “This initiative started in 2006. We lobbied for legislative reforms, and in 2015 the NCR [National Credit Regulator] regulations and the Maintenance Act were amended. Maintenance obligations must now form part of affordability assessments and maintenance defaulters must be reported to credit bureaus.”
She said it was worrying that the defaulters would complain to courts that they did not have money to pay for maintenance because they had other obligations such as paying for their vehicles and homes.
“With this partnership there will be a bridge between what is happening in our family court and what is happening in the credit industry so that we can start looking after our next generation,” Greyvenstein said.
“If there is a maintenance obligation, it is going to reflect on the credit record, and when one applies for credit for a new car or a new home or even to increase their clothing account, what should happen is that the person won't get credit if they are not paying for maintenance.”
She said the foundation will be working with parents and the courts to collect information on those who have maintenance obligations. She said the information will only be available to the credit bureau and not to the public.
Meanwhile, Felicity Guest, founder of Child Maintenance Difficulties SA, said while she welcomes the blacklisting of defaulters, she does not agree with a private company owning the data.
“What was proposed is that this will be done by a private company who is subcontracted to a particular credit bureau and the people who own the data will be this private company. I haven't seen the memorandum, but I have listened to their proposal and I watched this develop.”
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