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4 July 2007

Child Maintenance and Other Payments Bill

John Barrett (Edinburgh, West) (LD): This is a very serious debate. Many people have waited far too long to discover what is to replace the Child Support Agency. We have heard today about individual and more general cases involving the CSA from every Member who has spoken today—from Members in all parts of the House. We all agree that the reduction of child poverty is a key issue, but even in relatively affluent constituencies such as mine, where child poverty certainly exists in pockets, we need to provide a fair deal for those whose ex-partners have decided not to deliver on their responsibility to look after their children. Often, it is the wife who is the carer, and we must ensure that such people get a fair deal in bringing up their children.

Tackling evasive non-resident parents, particularly self-employed non-resident parents, in respect of whom there are specific problems, is also key aspects of the Bill. The resident parent—often, it is the mother—may have worked in their ex-partner’s business, particularly if it is a small business, and knows exactly what the income of her ex-partner is. When that ex-partner says that he now lives on £100 a week, receiving a very low assessment from the CSA, the resident parent will frequently say that he has bought a new car, built a new house or has a new partner, and is living fairly high on the hog. In many cases, the problem is not that the regulations are not in place, but that no action has been taking using the existing powers.

Voluntary arrangements are to be encouraged, and communication with other Government Departments is vital. I dealt with a case of a father who was saying to the CSA that he had a very low income and could not possibly pay a reasonable amount to look after his children, while he was telling the Home Office how well-off he was because he wanted to sponsor a potential new wife who was coming into the country.

I agree with my hon. Friend the Member for Inverness, Nairn, Badenoch and Strathspey (Danny Alexander), who asked, “Why not use Revenue and Customs to collect the money through the taxation system?” HMRC is ruthless in the way in which it collects income tax, and it is collecting the money, not distributing it, that is usually the problem. If that could be covered using an existing department, it would be one way forward.

It is easy to forget that most parents are interested in the welfare of their children, whether or not their relationship survives—but sadly there are some who are not. People must be allowed to put a voluntary agreement in place if they can. Before I was a Member, there was a case in my constituency where a young father of two had come to a voluntary agreement with his ex-partner. He was being hounded by the CSA, and in the end, the CSA letters were found along with his documents after he had committed suicide. It is not just a question of sorting out the financial needs of families. These are often families whose entire lives are falling apart; the marriage has fallen apart, and there are financial problems and concerns about the welfare of the children.

If the new Secretary of State can deliver a solution to the victims of the CSA, he will find agreement on both sides of the House. I congratulate the right hon. Gentleman on his new position, as well as Opposition spokesmen including my Front-Bench colleague, my hon. Friend the Member for Inverness, Nairn, Badenoch and Strathspey.

I intervened on the hon. Member for Barnsley, West and Penistone (Mr. Clapham) to point out that the CSA spends approximately £1 for every £1.85 it collects. If ever we needed evidence of why it is time for a change, that is it. That is one of the worst ratios of any country in the world. The CSA long ago abandoned the new scheme’s original targets of clearing applications within six weeks. The average clearance time now for new cases is close to six months.

The bottom line for any system of child support is whether the money is getting to the children. In this respect the current system has an unenviable record. In 1990, under the old court system, the typical maintenance award was in the region of £20. Fifteen years later, it is £21 per week, despite a considerable rise in the costs of bringing up children.

One issue that I shall touch on is the use of the IT system within the CSA. Some time ago, it came to my attention that the existing IT system—much maligned, with IT operators accepting the blame for being unable to transfer enough cases to the new system—was being blamed as the bottleneck holding up cases. But I was informed that the IT system was not the cause of the problem, but that those dealing with it were prepared to accept the blame because they had a number of other IT contracts with the Government.

One task for the new Secretary of State is to find out whether the IT system is really a problem, or whether EDS is well able to deliver corrections to the IT system but cannot because it has been told that the work that a smoothly running IT system would produce would require more staff. We have heard about staff cuts in the CSA. I have visited hard-working CSA staff in their offices and seen them do their best, often while being the victims of verbal abuse on the telephone. I am not blaming the staff, and I hope that in the new system, the staff get the back-up and the IT system that they deserve, and that the mothers get the money they deserve to spend on the children, whose welfare is all-important.

There has been much talk of change and a new approach to politics this week. However, I doubt that many hon. Members will disagree with me when I say that if ever there was a policy area in which change is most urgently needed, it is the system of child support. Ten years of this Government have been accompanied by 10 years of child support chaos. We have said goodbye to a Prime Minister, but the problem of the CSA and its replacement will prove more enduring, unless the new Government take the bold steps necessary.

In my six years in this place, I have taken part in half a dozen debates on the CSA and I have needed to trigger such debates in Westminster Hall on more than one occasion. When I looked back through Hansard I was disappointed to see that I had to make the same arguments and raise the same concerns year after year. I would like to believe that that says less about those debates and more about the lack of action by the Government. It is a scandal that some of my constituents have had to wait for so long for the Government to take meaningful action in that area. I am also disconsolate at the thought that even if the new system that the Bill will introduce works as the Secretary of State claims it will, it will not be up and running until 2010.

I was not in this place in 1991, but I know that there was cross-party support for the Child Support Act 1991. I would love to say that today’s Bill will be given the same warm welcome across the Chamber, but I for one have several real concerns about the proposals. Other hon. Members have outlined the scale of the failure in the CSA, but it is difficult to overstate how serious the challenge is for any new system. Some 38,000 Scots are waiting for payments and some £3.5 billion in maintenance remains uncollected, with £2 billion written off as uncollectable. That is not the Government’s debt to write off. Parents are due that money, and should be able to take action to recover what they can through the courts if it is written off by the Government. Less than half of the non-resident parents who made a payment in the last quarter are paying the full amount they owe and, in spite of the ongoing problems at the CSA, staff numbers have been cut.

Until recently, Ministers were still talking about dealing with the problems in the agency and saying that they could get it “on a stable footing”. I am pleased that the Government have recognised that there is no use in steadying a sinking ship. While I welcome the belated decision to scrap the old agency, we must ensure that the Child Maintenance and Enforcement Commission is not merely a rehash of the CSA. We need real root-and-branch reform at every level, and I would contend that the jury is still out on whether that is what the Bill will provide. I echo the concerns of the National Association for Child Support Action, which rightly pointed out that if CMEC is to manage existing cases, and operate with existing CSA staff and IT systems, it is difficult to understand how it can be considered a “radical” departure from the old system.

Perhaps the biggest immediate hurdle that the CSA has to overcome is the perception that it is a toothless and failing agency that is not taken seriously by parents—the very parents who often owe substantial arrears towards the welfare of their children. The recent report by the Work and Pensions Committee stated that it was

“difficult to exaggerate the CSA’s low reputation”—

although some hon. Members have tried their best this afternoon. I am sure that every Member’s weekly surgery appointments will demonstrate the scale of the mistrust and underline the challenge of winning the hearts and minds of parents wronged by the current system. To restore that shattered reputation, we will need far more than tinkering change. We need wholesale replacement of one of the most disastrous organisations in modern British political history.

Other hon. Members have dealt with the fine detail of many aspects of the Bill already, so I will keep my own comments brief and focus on several areas of particular concern to my constituents. A key reason why the agency is seen as toothless is that it has placed far too little emphasis on compliance and too rarely uses middle-order steps to ensure regular payments. Currently, there is little confidence that the CSA will pursue non-compliant parents, and if maintenance is not being paid, the parent with care has to make numerous complaints. Even then, the agency may not deliver effective enforcement action. Many of us will have heard first hand from mothers about why they have had to act as detectives to prove that their ex-partners have higher incomes than have been declared. At the same time, however, the agency will often take the word of the non-paying father as gospel.

In that regard, I am pleased that some new measures to increase collection are being introduced, such as the use of deductions from earnings. However, I caution that the problem with enforcement has had less to do with the CSA’s lack of powers than with its failure to use them. I hope that the new structure will change that, but I am not convinced that the measures in the Bill will fix the problem. As I said, the jury is still out.

The principles guiding the changes look good, but I share the concerns of those who feel that we have been given insufficient detail about how the changes will be achieved. With the best will in the world, measures such as removal of passports and driving licences will do nothing to deal with the fundamental problems that dogged the previous organisation from the start.

We all agree that a truly child-centred policy must look beyond merely enforcing the financial obligations of non-resident parents and do much more to encourage the involvement of both parents in their children’s upbringing. In that regard, I welcome the Government’s recognition that there should be no barriers preventing parents from coming to their own, mutually agreeable, arrangements for child support. However, if such agreements could be reached in every case, the Government would not need to get involved in child support at all. As that is clearly not the case, I seek assurances from the Minister today that parents with care must have a clear choice to go to CMEC if that is what they want to do, without being pushed into making voluntary arrangements that are unsatisfactory—to them, or in respect of the child. In particular, I hope that the Minister will say what help and advice will be given to parents before a decision about whether to adopt a private arrangement is made. Also, if the agreement breaks down, CMEC must be ready, able and accessible, so that it can help sort the problem out.

Various Scottish Members have mentioned the key problems that exist in Scotland. However, I think that I am the only Scottish Member here today who has not been briefed by the Law Society of Scotland on that topic, so I shall not try to repeat the details that have been given already.

Another major problem is that the current system is clearly unable to cope with the volume and complexity of its work load, while the communication with the Inland Revenue that is crucial for accurate assessments has been very poor in the past. I am pleased that there is to be a greater role for the Revenue in that respect, but I am concerned that the workload will remain unmanageable unless the system is simplified.. Simplicity is vital if maintenance calculations are to be made quickly and reliably.

I am pleased that the Bill recognises the problem of calculating income when the non-resident parent is self-employed, but I am yet to be convinced that the new measures will close the loopholes currently being exploited. There has been a particular problem where the ex-partner is self-employed, and it is difficult to verify profits and income independently. A case that I took up last year involved an ex-husband who said that his income was around £100 a week. The CSA calculated maintenance on that basis, but anyone who looked closely at that man’s lifestyle would see that it simply could not be supported on £100 a week.

Any basic investigation by the CSA would have discovered that, but none took place. I remain unconvinced that the measures outlined in this Bill will put a stop to fathers avoiding supporting their children by using clever accounting techniques. It is therefore vital that information-gathering powers for the new organisation are improved, so that access to information held by other arms of Government and other organisations, such as banks and credit agencies, can be made easier.

Like other hon. Members, I am concerned about the problems that any new handover will bring. We are still waiting for some old cases to transfer to the current system, which presents us with the ridiculous prospect that when the new system is launched, three entirely different child support systems could be in operation at the same time. Like other Members, I seek assurances from the Minister that that will not happen.

The 2006 National Audit Office report said:

“The Child Support Reforms have failed to deliver the improvements in customer service and administrative efficiency, which might have been expected from the much-needed new rules”.

There is much still to be done to ensure that we shall not be saying precisely the same thing about this Bill in the years to come.

Related items

tax and benefits
child support

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This website was established while I was a Member of Parliament. The site content is being kept online as a source of information, but all forms / email have been disabled.