A number of participants in my International Year of the Family (WA) study (Murphy, 1996) advised that they were financially worse off in a stepfamily than they had been in a sole parent family. Although this issue affected both parties, it was particularly raised by women who saw the costs of repartnering as being too high in both economic and personal terms.

This paper reports some of the findings from a research project funded by the Government of Western Australia International Year for the Eradication of Poverty (1996) Taskforce . The study investigated how couples in stepfamilies manage what Walker (1992) calls "a maintenance in, maintenance out" economy. Forty in-depth interviews and four focus groups (including one of stepfamily counsellors and educators) were used to investigate some of the financial implications of repartnering and to gain an insight into the extent of poverty in stepfamilies. The study explored potential strategies for alleviating the financial stresses of stepfamilies, and also developed some policy proposals for consideration.

The reports of both the Child Support Evaluation Advisory Group (1992) and Joint Select Committee on Certain Family Law Issues (1994) noted that while the Child Support Scheme appeared to be achieving its objectives, there were two unknown elements which could limit its effectiveness over time. These elements were the impact of children moving from one residence to another, and the implications of second (and subsequent) families. These both emerged as central issues for the participants in this study.

Although current data identifies less than 5% of Australian households as stepfamilies, the statistics of divorce and repartnering suggest that this is a significant under estimation. I agree with Martin (1998) in his assessment that about 20% of Australian families are stepfamilies in various combinations.

Most stepfamilies are created when a man joins a female-headed sole parent family currently about 18% of Australian families (de Vaus and Wolcott, 1997). Many studies have documented the fact that most female sole parents experience rapid downward social mobility after separation or divorce, thus producing "a new class of poor" (Shehan and Kammeyer, 1997; Travers and Richardson, 1993).

A recent newsletter from a West Australian bank reported that divorce is the most impoverishing life event which Australians can experience and advised customers to seek professional help to minimise the potential financial risks (Williams, 1998).

Many welfare polices and administrative processes appear to be based on the assumptions that if a male partner is in residence, there is ipso facto sufficient financial support and any poverty which the woman and her children may have experienced as a sole parent family is remedied (Fine, 1994; Funder, 1996). Policy formulation is further complicated as contractual (legal) relationships inherent in birth families are replaced by covenantual (voluntary) relationships in stepfamilies.

Confusion about the voluntary nature of a stepparent’s contributions is reflected in policies of both State and Federal Governments (Funder et al., 1993). For example, many departments regard a stepparent as legally no more than a family friend. However, the Federal Department of Social Security (since restructured as Centrelink) assume that when he is in residence, a man will support a sole mother (and her children) and her pension entitlements are reduced accordingly. Under Austudy provisions a stepparent’s assets and income affected a student’s eligibility, whereas those of a foster parent did not. Yet, unless the child is adopted, the legal relationship between a stepparent and the child is the same as that of a foster parent - they are both voluntarily looking after someone else’s child.

This situation became even more confusing with the introduction of the Common Youth Allowance (CYA) in mid-1998. The allowance provisions inter alia raised the age of dependency from 18 to 21 (in some circumstances, 18 to 25) years of age. The provisions also introduced a parental means test to assess a young person’s eligibility and, in so doing, established a new definition of parent so that, where a natural or adoptive parent "is a member of a couple and normally lives with the other member of the couple", then the "other member of the couple" (namely, the stepparent) is a 'parent' for the purposes of the CYA means test.

This definition imposes a legal status on a person who (in most stepfamilies) has no legal relationship with - or liability for - the young person seeking assistance from the State. It also undermines the legal status of the young person’s other natural parent (in most stepfamilies, this is the non-resident father).

The potential for confusion and conflict among the resident natural legal parent, the non-resident natural legal parent, and the CYA legal "parent" is obvious. There is currently no indication that Child Support legislation is to be amended to reflect increased ages of dependency.

This compounds an already complex situation where, for many couples, the emotional and financial cost of attempting to balance the seemingly endless and competing variables of a "maintenance in, maintenance out economy" is too high and they separate; often to repeat the cycle with another partner (Funder, 1996).

Each experience of stepfamily formation is individual and unique, and the variables are almost indeterminable. The project was a qualitative study, using a snowball sampling technique (based on three Perth agencies involved with supporting stepfamilies and sole parents) in order to access the widest possible repartnering experience within the constraints of the project budget.

One quantitative measure was obtained - whether people could access $1,500 within a week in an emergency. Only 30% of the sixty-three participants could do this; as opposed to some 79% in other Australian studies (Brownlee et al., 1995; McDonald, 1993; Weston et al., 1995). This immediately suggested that many people in this study were experiencing considerable financial difficulties.

Preliminary analysis of the data revealed significant concerns in relationships with both State and financial bureaucracies. Almost two-thirds of the data related to these relationships while the remainder addressed societal relationships. This pattern was very similar to findings in a recent study of change in organisational shape (Earles, 1999). The four dimensions of change (administrative, market, civil, and political) which she identifies provided the framework for my data analysis.

Most of the data was collected before the restructuring of income maintenance administration in Australia and introduction of the Centrelink organisation in

late-1997. Some of the issues and criticisms raised in the report may have since been rectified. It is also acknowledged that a number of changes to the operation of the Child Support Agency (CSA) and calculation of child support liabilities were announced in September 1997, so again some of the detail of the participants’ views may have been overtaken by events.

Results and Discussion

"Poverty to one person is quite different to poverty to another."

(Study participant)

As this young mother observed, the definition of poverty cannot be confined to the financial milieu. The framework used in this study acknowledged other dimensions of poverty such as choice, access, and hope which participants identified as impacting on the quality of life in their stepfamily.

More than a third of the data centred on the issue of child support and the ability of external agencies influence and determine standards of living. One (or both) of the partners may be liable to pay child support (or eligible to receive it), and the Child Support Agency will determine how much should be paid by whom. The liable (non-resident) parent may (or may not) pay as directed. While there might be some certainty of liabilities, the assets and income are often uncertain or irregular. This lack of control over their finances was seen by many people as a form of poverty.

Poverty of choice also featured prominently. People spoke of pre-existing financial commitments being disregarded by various State agencies - but being enforced by institutions such as banks, local councils, finance companies, or rental property managers. Other limitations of choice ranged from the inability to consider major purchases such as a home or household appliances, finding (and affording) a house large enough to accommodate the expanded family and / or visiting children, the ability to have children of their own, or the children participating in school outings, hobbies, or sports. In four cases, couples reported having to 'ration' or postpone their own medical and dental treatment as they could not afford both the consultation fees and prescription charges.

Concomitant with the limitations of choice is the poverty of access when information and associated services cannot be obtained, the implications are not explained (or understood), and requests for help are denied or merely ignored. Restrictions of access include the exclusion of stepparents from CSA appeal hearings.

These forms of poverty manifest themselves in emotional pressures within the new relationship and, in the extreme, as a poverty of spirit and sense of hopelessness. Most of the families in this study had learned to thread their way through many of these unanticipated intrusions in their new life. However, a small number of the families exhibited a sense of despair and described themselves as being trapped with no apparent way of rectifying the situation. Some of these people saw their only solution in either bankruptcy or separation.

The results explore poverty in stepfamilies from the four dimensions noted earlier.

The majority of Australian families have a relationship with the administrative aspects of the State which is limited to submitting tax returns or claiming rebates such as Medicare or Family Payment. However, most stepfamilies have an ongoing, and often intense, relationship with the CSA and so have little or no control over large proportions of their income or expenditure.

All but two of the people who had spent time as sole parents had received the Sole Parent Pension, together with concessions such as Rent Assistance and electricity supply charge rebates. Continued eligibility for State support required that they also register with the CSA. Hence, there was an established client relationship with the two central bureaucracies (the CSA and Centrelink) before people met their new partner. The intricacies of preserving eligibility for various concessions became central issues and presented varying stresses in each new stepfamily.

People were particularly keen to make the point that family life cycle events (such as having another child, the wife returning to the workforce, or the husband being promoted) which had been independent decisions in their earlier family, now all had implications in respect of child support payments. This lack of autonomy reinforced the all-pervasive position of Government bureaucracies in the financial affairs of stepfamilies. An unintended consequence was that none of the people would contact relevant State Government assistance (such as the Parent Helpline) as they perceived it to be an extension of 'the Welfare' and therefore a threat.

The relationships with Centrelink and the CSA were compounded by the fact that children can, and frequently do, change residence to live with their other parent. This mobility invariably has significant impacts on the financial management of both the 'relinquishing' and 'receiving' households.

The participants’ views were consistent with previous studies in that there were distinct differences between how men and women saw the issue of child support and the implications it had on their ability to form (and support) a new family.

It became apparent that the internal finances of many stepfamilies are determined by the CSA administration of the formula-based assessment scheme which is not designed to cope with the variations between stepfamily composition. Many people reported that rigid bureaucratic administrative procedures seemed to be applied in situations which are often quite fluid and require flexibility, innovation, and understanding. Of particular concern was the apparent disregard of financial commitments made under pre-existing circumstances, including children changing residency.

Despite attempts by both the CSA and Centrelink to facilitate information flows, this is often not as effective as might be envisaged, especially for people who are not familiar with bureaucratic language. Many participants reported that they did not understand letters that they received. Those people who had experienced the CSA Appeals / Review process reported that it was very daunting, especially for those who are overwhelmed by bureaucratic processes. Stepparents reported feeling excluded and irrelevant, despite the fact that they might be caring (at least part-time) for the children involved.

More than half of the women reported inconsistent payments from the CSA and monthly differences in excess of $1,000 were not unusual. This makes effective household budgeting almost impossible.

Participants reported the Family Taxation initiative as being too complicated for people in atypical (and often stressful) situations to understand. Some women felt that easing the eligibility criteria for non-resident liable parents might ease some of the antagonism over what many liable parents see as tax-free income. It is unclear what impact the proposed GST will have on this aspect of stepfamily finances.

The unremitting and inveterate relationship with the CSA also has implications for the emotional health of stepfamilies which, when added to other administrative complexities, further stresses couples attempting to establish new relationships.

This lack of autonomy represents an acknowledged dimension of poverty.

Among the myriad of financial issues which the participants raised were returning to the workforce, balancing the potential 'losses' of pensions and concessions against possible 'gains' of earning an income, the implications of casual work, the financial implications of moving in with a new partner (including 'inherited' debt), housing issues, relationships with financial institutions, and the implications of children changing their place of residence to live with their other parent.

A factor which many participants felt was overlooked in stepfamilies is that most have to cater for (and transport) a larger number of children than an 'average Australian family' of 2.4 children. Indeed, if they are attempting to accommodate two 'average' families, there will be five children all seeking to preserve their own ideas of space and lifestyle. Moving the family for outings such as picnics becomes a spatial juggling act, as do the competing demands for sporting and recreational 'parental taxi' services. Most couples in this study felt that two cars were essential.

These additional costs are seldom acknowledged by people who are not living in a stepfamily.

Unless both partners were working full-time, the people in this study reported they were worse off financially than they had been in their first relationships. Many reported difficulties with general household budgeting as they tried to cope with more children but with uncertain income. This is compounded when children not only 'float' between their two homes on contact visits, but also can (and often do) exercise their right to move in with their other parent (with minimal warning). These changes can have significant implications for household budgets, particularly if there are now siblings with both the resident and non-resident parent.

Returning to the workforce and attempting to balance the household budget was complicated by the casual or part-time nature of most of the work being offered and the impact on various allowances and concessions had to be weighed against any advantages of working. Many participants reported that an employer’s preference for informal cash payments (in order to avoid statutory obligations) compounded their difficulties in assessing the value of working. Therefore, gaining employment did not necessarily resolve the dilemma of fluctuating income when more reliable income from concessions might be lost. Couples went to considerable lengths to retain eligibility for subsidies (such as the reduced prescription charges inherent in having access to a Health Care Card ).

Almost all of the couples in this study had started their new relationship with debts 'inherited' from a previous relationship; either directly as a result of matrimonial property settlements, or indirectly as a consequence of re-establishing themselves.

Few of the families in this study had any savings and, as noted earlier, the majority (70%) could not independently raise $1,500 within a week to meet an emergency. On this measure alone, these families must be considered disadvantaged when compared with previous Australian studies (McDonald, 1993).

The intricacies and uncertainties of most stepfamily incomes had implications for access to housing loans and dealing with financial institutions. People reported frustration that Child Support liabilities were included while incoming payments (often higher) were excluded. The advocacy of financial brokers was seen as essential to enhance eligibility for various loans. One woman reported that her mortgage was predicated on her children continuing to reside with her.

The financial implications of the flexible family are not well appreciated and difficult to accommodate within a policy framework - except as an acknowledgement that flexibility is required. However, the families themselves saw their restricted (or lack of) choices as indicating a form of poverty. This feeling of impotence was often compounded by emotional tensions as children inevitably compared lifestyles and conditions; either in their other parent’s home or during their parent’s marriage.

Many participants reported feeling somehow different from other families and having the problems they faced being disregarded. Almost all of the couples commented on the lack of support and understanding that they received in their attempts to establish and maintain their new family. This ranged from general comments about "knowing what they had taken on", to specific issues dealing with hospitals and other health professionals, relationships with schools, legal issues (guardianship, inheritance, Wills, and estate planning), establishing a working relationship with the children’s other parent, and accessing support services for both the parents and children.

Few people, either in or out of stepfamilies, acknowledged the depth of feeling which the children have at the advent of a stepparent in their lives. There is minimal access to financial assistance with counselling services for children who are seeking to reconcile their feelings on these issues.

There is a continuing relationship with the children’s other parent. Therefore, decisions in stepfamilies are seldom autonomous and can rapidly become complicated if one parent disagrees with a proposed course of action. Some step-parents reported feeling like an extension to their partner’s previous relationship. Similar difficulties of communication and consensus occur in maintaining children’s relationships with their wider kinship networks, especially grandparents.

The voluntary nature of the stepparent’s role is not acknowledged by society. The legal position of a stepparent is ambiguous and many people assume that stepparents have authority when legally they do not.

Despite the increasing incidence of divorce and repartnering, there still appears to be significant societal disapproval of the process. Most of the people in this study reported a sense of social isolation and a lack of societal understanding of the types of issues they were attempting to deal with. Many reported that estate planning and preparation of Wills is complicated by the differing relationships in first and subsequent families.

This feeling of exclusion and "not fitting" is another acknowledged form of poverty.

Although the people seldom talked in political terms, the reality is that stepfamilies do not have a high profile in society and, for many, they represent a challenge to the ideals of the nuclear family upon which social policy is based. In this respect, there was a political dimension to virtually every issue raised in the study.

Among the issues raised were the lack of legal framework or guidance to stepparents, the absence of a widely accepted language (which has been further complicated by the terminology of the Family Law Reform Act, 1995), and the general disregard in which stepparents are held in society.

A number of participants felt that society resisted formulating a legal framework or specialist language for stepfamilies as this would equate to an acknowledgement

that they are the equivalent of nuclear families and should be treated the same. (Similar arguments have been advanced about de jure and de facto marriage - to recognise the latter makes it the same as the former, and it is not - or is it?)

The complexities of multiple and overlapping family life cycles do not seem to be appreciated by policy-makers.

There is a need for support services such as a telephone counselling service similar to the 'Hotline' operated by the Stepfamily Association in Britain.

The stereotypical images of dismal living conditions normally associated with poverty were present in only two of the families in this report. The remainder of the participants lived in reasonably comfortable housing (albeit, not necessarily equivalent to their previous relationship) and had sufficient income to feed and clothe their families. Prior to forming a stepfamily, none of the participants had envisaged either having to accept such a reduced standard of living for their children or their limited capacity to improve the situation.

It is concluded that the four dimensions used to frame this report suggest that poverty is a real issue for many contemporary Australian stepfamilies.

Detailed technical recommendations are beyond the scope of this paper but many are inherent in the discussion. The following general recommendations are:

- The philosophy of joint parental responsibility for the support of their children (and the right of a child to be supported equally by both its parents) should be reinforced in all areas of family policy.

- The legal position and ensuing responsibilities of stepparents should be investigated with a view to providing some formal guidelines for welfare policy and programmes, administrative agencies, and people contemplating a stepfamily relationship.

- The rigid application of the Child Support formula should be reviewed to include provision for 'split residency' situations, equal treatment of all natural children of parents, and the recognition of financial contracts made under pre-existing conditions.

- Some mechanism should be investigated whereby child support payments are made regularly, whether or not the money has been received by the Agency from the liable parent.

- Eligibility criteria for Concession and Health Care Cards should be reassessed so that the benefits are transportable between residences. Perhaps eligibility could rest with the child based on the total amount of "support" being received from both parents.

- The formation of Stepfamily Associations and telephone counselling services should be encouraged.

- The establishment of a specialist "Stepfamily Desk" within policy directorates to advise on the implications that various State and Federal policies might have for stepfamilies should be considered.

In 1997 the Senior Research Fellow at the Australian Institute of Family Studies, Kate Funder cautioned against hasty action to amend the Child Support Scheme until more is known about how families reform and function (Funder, 1997). The report on which this paper is based provides some insight into these processes and highlights the conundrum of the relative claims of dependent children from first and subsequent relationships. The report also demonstrates the difficulty of trying to formulate policy in the absence of a legal framework.

Each stepfamily has to develop its own way of dealing with the complexities of their situation. Similarly, each bureaucratic authority must also formulate appropriate responses to accommodate the complexities of stepfamilies. The absence of sensitive polices and flexible procedures increases the stepfamily’s sense of frustration and exclusion (and probably contributes to the acknowledged high dissolution rate of second and subsequent relationships). Coupled with the stresses of trying to manage a "maintenance in - maintenance out" economy as outlined in this paper, these multifarious factors place a significant number of contemporary Australian stepfamilies in severe financial difficulties, which many people would regard as being in relative poverty.

Hopefully, the report will provide a basis for policy development to ameliorate the financial situation of many stepfamilies.

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