Examination of witnesses (Questions 60 - 79)
WEDNESDAY 22 JULY 1998
BARONESS HOLLIS
OF HEIGHAM,
MR MIKE
STREET and MRS
FAITH BOARDMAN
60. When there is clearly quite a big distance,
then it becomes slightly hard, does it not, to say that where
a chap lives in London with his second family but has to work
in Newcastle, or wherever he might have to work, why that should
not be taken into account, because you see that as an exceptional
cost.
(Baroness Hollis) That is his choice. It is a
choice that he has made about his current lifestyle. It is not
about the costs of supporting his first family in a different
way than by direct child maintenance. That is the consideration.
You are absolutely right. If we do not keep the gateway narrow,
then we reinvent the complexity of the existing system. The point
about a Green Paper is we will get responses on this but we hope
that what we could establish is that you could only go to appeal
or to a tribunal if you are already paying the initial assessment,
so it is not an elongation process. Secondly, it is on the grounds
of what counts as decent and assessable child support of an exceptional
nature, over and beyond the formula.
61. The first thing that you were saying
there, where there is exceptional support in terms of the mortgage
or in terms of the school fees—is that not making it more
complicated than it needs to be? Should he not just pay the ten
per cent or fifteen per cent and that goes towards school fees
and then he is generous enough to pay the school fees on top?
(Baroness Hollis) We can look at this. We have
not yet established how one might give guidance on making those
calculations. What we are trying to establish at the moment is
to try to build consent to the principle that the only way we
can keep this simple but also be fair is that balance. The grounds
for altering the initial assessment and having a different final
determination are on the basis of only child support. I think
you are right. There are different ways of calculating it, but
it is the principle at this stage that we are trying to establish
in the Green Paper.
Mr Wicks
62. When the original Bill was going through
Parliament, as you know, there was a lot of concern expressed
that, in cases of domestic violence or issues about incest, it
would be wrong to force mothers to cooperate with the Agency,
so the concept known as good cause was invented. If you had good
cause not to cooperate, you did not have to, but the whole thing
seems to have got out of hand now. Certainly this select committee
in the past thought that there was a growing development of collusion
between the parents so as not to cooperate with the Agency and
we now understand from the Green Paper that fully 70 per cent
of mothers are now not cooperating. Could you comment on how the
reform process, while being sensitive to the issue of domestic
violence, nevertheless will have a system so that mothers and
fathers cooperate?
(Baroness Hollis) There are two or three approaches.
Firstly, we know that if there is closer working with the parent
with care that figure of 70 per cent comes down quite sharply.
If we come to the lone parent and the first time she moves onto
benefit and discuss the entire package she has some assurance
that the maintenance will be paid and that, if there is a risk,
her name is protected, then we have her cooperation. We then see
that non-compliance figure of 70 per cent drop quite dramatically.
We need an active relationship with her to get her cooperation,
to see why the flow of maintenance is important for her and her
children. Secondly, she will have a positive incentive. There
will now be a maintenance disregard—that is a child maintenance
premium—of £10. If she were to refuse to cooperate
and there was not good cause—that is, an acknowledged fear
of violence—she would risk a benefit deduction of some £20
and the loss of the disregard of £10, which is £30.
The average assessed maintenance is only £29. For very few
non-resident parents would it be worth their while to make up
that black economy figure to cover both the deduction of the £20
and the £10, the full £30. He would have to pay more
than £30 and probably in most cases more than the actual
non-black economy figure that he would be assessed to pay. Firstly,
by cooperating with her, we hope to get her support in a positive
way; secondly, she will know that if she does not cooperate and
she does not have good cause not to cooperate she will not only
face the deduction but the loss of the maintenance disregard and
that is how we hope to get her support on board.
(Mrs Boardman) This is another of the issues where
we are anxious to do what we can in the meantime. The closer working
initiative with our colleagues in the Benefits Agency actually
started on 1 April, having been piloted last year. As the Minister
says, it is in itself helping quite considerably in terms of giving
a clearer picture to parents with care.
(Baroness Hollis) There is no way we would wish
to be party to any risk of exposing women or children to violence.
That should be a given.
63. Is there not a case for moving towards
a much closer integration of assessment for income support and
assessment for child support so that one is saying, "Here
is the deal. You have a right to income support but you have a
duty to cooperate in terms of the child support", rather
than the two being totally different processes?
(Baroness Hollis) We are hoping, with the closer
working that we are talking about, you would have an integrated
package. Here is your income; here is your income support. That
element is maintenance. That is the element you will be able to
carry with you into work. These are the approaches possible for
child support. These are the opportunities for employment. This
is your package. In other words, if you look at the situation
of lone parents, we have so far two of the pillars in place. We
have in place the changes in benefit structure as a result of
last spring's Budget. We have in place the New Deal with child
care strategy unfolding. The third element in place to be able
to spring lone parents into what they say they want, which is
the independence of making choices whether they work or not, is
secure and reliable maintenance. We know it is not so much the
level of maintenance that matters to the lone parent as whether
it is paid reliably and therefore whether they can afford to take
the risk to move into work. We are hoping that, if this philosophy
is accepted and we do what we hope, believe and expect we will
be able to do, the lone parent will not only have the New Deal
on her side but secure and reliable child maintenance as well.
64. Can I ask you more about the issue of
domestic violence? We all know this is very, very sensitive. We
have heard your statement that in no way do you want to put women
and children at risk and we understand that, but is there not
a fundamental dilemma at the moment that the violent father or
the father who threatens violence, instead of standing a real
chance of being prosecuted by the police and put in prison where
he belongs, is actually rewarded by not having to pay child maintenance?
I have read in the press—I have not checked to see whether
it is true—that on the Internet advice is given to fathers
about breaking a window in the house to show that you really mean
business. Is it not just too easy for the thug father to get away
with it? Is there not a way of protecting the mother by saying,
"We, the state, will take on the responsibility of finding
out who the fathers are", because we are certainly not going
to put up with the nonsense where the good dad pays and the thug
father gets away with it?
(Baroness Hollis) I agree. One of the areas which
Faith and her team are looking at is how they can guarantee, not
just promise, security to the parent with care to name the father
who has a history of violence and protect her. It is a sensitive
area. I think we all accept the dilemmas around this area. That
broader issue of domestic violence must be seen within the wider
approach being pursued by the Minister for Women as well as the
Department of Health and so on. There are other approaches and
strategies too that we are looking at in terms of the Lord Chancellor's
Department. There are already contact centres. It may be that
further research will show that, though there may be violence
between him and her, it does not necessarily translate into violence
between him and the children, if you can produce a secure and
safe contact place. We may work with grandparents if the father
is young and it is the drink talking. There are a range of strategies
but I think everyone will understand that this is a very difficult
and very sensitive issue. I entirely take the point about not
rewarding a violent father but equally we cannot afford to take
the risk of seeing a child exposed and damaged by real violence.
In other words, if the violent father is not just play-acting
but is violent for real. It is a tightrope and we are going to
do our best in consultation to try and stay it.
65. At the moment, in terms of trying to
secure maintenance, the onus understandably is often placed on
the mother because she is the one most likely to know who the
father is. Is there not a way of trying to get the balance slightly
more sensitive so that one is saying, "Here is an agency
that needs to know who the father is. One route is through the
mother but there are other routes that we can pursue."
(Mrs Boardman) There are potentially. This is
in part bound up with the legal position around paternity in a
broader sense which clearly is a much larger issue and more for
the Lord Chancellor and other family policy areas. It is indeed
being thought about in those contexts. Quite clearly, we need
to keep abreast of whatever is being thought about. Certainly
there are schemes done in, for example, some of the American states,
where the paperwork, if I may put it like that, is taken care
of in hospitals when the birth is taking place. None of those
things are things which the Agency has any legal power to do at
the moment or indeed any resources to do at the moment. It is
an area which causes us concern and our staff concern. These are
some of the most difficult decisions which individual staff members
are called upon to make and I think they are all very conscious
of the potential consequences either way. I think it is one of
a number of areas where we need to do a lot more work and keep
abreast of other things which will be developing between now and
when the new system and see how we can tie in with them. Any suggestions
would be very welcome.
Mr Goggins
66. I wanted to press Baroness Hollis a
little further on the £10 disregard which I think is a very
welcome step forward. It is regrettable that that was not in the
arrangement from the beginning, but given the other initiatives
for lone parents which you mentioned before, particularly New
Deal; given the commitment of the Agency to closer working with
lone parents to get more positive results and given that the government
already had a policy commitment to introduce the disregard—it
is referred to on page 16—when resources allow, will consideration
be given to introducing that disregard in advance of the other
new arrangements which will have to wait until 2001?
(Baroness Hollis) No. This goes back to Julie
Kirkbride's question about the situation for the Treasury and
the taxpayers. There are two reasons. Firstly, we believe that
this is an integral part of a new, simple and fair rate system.
It would be wrong, in my view, to pull out bits of it in advance
in that way. Secondly, the cost would be high because the gross
cost of a maintenance disregard on current caseload is £100
million. If we abstract the current maintenance bonus, which is
the back to work bonus, the net cost is £80 million. I think
it would be unreasonable to expect other parents to pay that £80
million in advance of going onto the new formula. The new rate
and system is a package and we think it is right that it should
be a package but in any case there will be real cost implications
which we would have to recoup in other ways if we were to advance
the front ended cost of the maintenance disregard.
67. In your answer to Julie before, I think
you said after three years the balance tips.
(Baroness Hollis) After three years in the new
system the balance tips.
68. The balance will tip at some point.
I ask the question really as a follow up to the comment from Patricia
before because there is quite rightly an expectation that things
will change and there is already some frustration that things
will not change until 2001. It would seem to me that as part of
the package between now and 2001, to which there is a commitment—and
it is clearly there in the Green Paper—things start now,
not in 2001. Consideration should be given to the introduction
of this. There will be a cost. That cost will balance out at some
stage in the process, but it will give an incentive to people
to cooperate and be involved now. It clearly is a problem, as
my colleague Malcolm Wicks referred to before, with 70 per cent
non-compliance. I would strongly urge consideration of that.
(Baroness Hollis) We will obviously take that
point on board but I have to say I rather doubt, in all honesty,
that we will be able to meet it given all of the discussions that
have taken place so far on trying to keep the cost neutral package.
We will certainly have a look at it, but I would not expect us
to be coming back with that, I have to say.
Mr Pond: The image that Mrs Boardman
has conjured up for us of the CSA official being present at the
birth does give a whole new meaning to the term "nanny state",
does it not? We did hear some evidence, when we were in the United
States, about the way child support provisions are trying to use
that mechanism. I am a little anxious about it because I suspect
that it would mean there would be far fewer fathers present at
births than at the moment. While I think Malcolm Wicks is quite
right in suggesting that we need to find other ways of tracing
these fathers, that might be too high on the agenda as an idea.
Chairman
69. I can share with the Committee the fact
that when I attended the birth of my first child I fainted so
I would be of no use.
(Baroness Hollis) You would have given the name
of your brother, if asked.
Mr Roy
70. On the subject of enforcement and the
methods for it, going by your opening remarks when you touched
on the stigmatisation of the hero and outcast, the outcast to
me is the villain and the villain is the parent who is not prepared
to accept his or her responsibilities. We have heard from Chris
about the lessons that we learned in the United States. We went
to the United States last year. We heard about questionnaires
in the maternity unit; we heard about the clamping of cars; we
heard about the withdrawing of driving licences and also public
registration of the deadbeat dads. Seriously, has anyone looked
at the pros and cons of some of those other, more sensible aspects
as a way of fighting back against the outcast/villain? It also
struck me that I find the Paper kind of thin when it comes to
any new legislative powers that might be available. I would like
to explain. It is no use changing the system and expecting everyone
just to accept what is there. Therefore, if they do not accept,
what are you going to do about it?
(Baroness Hollis) You are absolutely right. If
a simple rate does not deliver compliance, we have failed. The
problem at the moment is not so much lack of enforcement powers
as lack of time to use them. By having, we hope, 90 per cent of
staff time ensuring compliance rather than 90 per cent of staff
time determining assessment we actually put the resource in. The
second point is a point that Faith touched on earlier. By going
for a simple, fast and easily understood assessment, we should
not have the problem of arrears. What psychologically happens
now is that, once people start acquiring arrears because it has
taken six months or a year for the assessment to come through,
it becomes a cliff that they cannot face climbing and therefore
they do not. We should tackle that problem too. We have powers
of collection and enforcement which are wider than people perhaps
understand. They range from deduction from earnings orders through
to straight garnishee and charging orders through to committal
if all else fails. In other words, we have the same powers as
other bodies have to enforce the payments of debts. There are
particular problems associated with the self-employed. This is
not peculiar to the CSA; it also belongs to the Inland Revenue.
We also have the problem at the moment that there are offences,
in my view, to which there are no penalties attached, like the
providing of false information by the non-resident parent. We
are going to have to make that a penalty. If there are other areas
over and beyond that which are not counter productive—if
we slap it on the car and remove the driving licence, he then
cannot work and we therefore do not get the maintenance flowing—but
if there are others we would certainly be interested and very
happy to look at them. Clearly, we have to get penalties that
commend consent more broadly as not being counter productive.
We would certainly welcome the Committee's help on this.
71. With regard to employers, what can be
done to help them to pay a certain amount to come into a scheme
whereby it is worth their while making a deduction from salary?
(Baroness Hollis) We have a difficulty where employers
are unhelpful in complying over deduction of earnings, but Faith
might be able to enlarge on that.
(Mrs Boardman) We do on occasion have difficulty
with employers. We do have already the power to prosecute potentially
non-cooperative employers and we do use that. In practice, we
have found that it is sufficient to draw their attention to the
fact that we could prosecute them. We have not yet had to follow
that through to the ultimate.
72. Have you figures on the prosecutions?[4]
(Mrs Boardman) We could provide you
with them. I do not have them to hand.
(Baroness Hollis) Am I right in thinking it is
13?
(Mrs Boardman) We also have been following through
to prosecution some self-employed cases. That has only been in
the last few months. Again, the experience has been that, when
given a suspended sentence, they have actually paid up rather
than go to prison. In part, it is an issue, as the Minister says,
of us having the resources to follow through some of the powers
we already have because, as you will appreciate, taking those
sorts of cases to that sort of extent is extremely expensive in
resources, time and effort.
73. I accept that it is expensive but I
also think that there is a real need to send out the proper signals.
(Mrs Boardman) We agree with you and that is why
we have taken a number of self-employed cases recently to that
extent and would intend to go on doing so in aggravated cases.
Chairman
74. Can I take you back to the treatment
of old cases? I have two areas of concern. As I understand it,
reading the proposals in the Green Paper, there will be four existing
categories of cases that will still be outstanding when the new
system comes on stream. There will be people who have not cooperated
at all with the CSA and have not received an assessment of any
kind. There are bound to be cases of that type still left. Then
there are those who have had an assessment who just have not paid
anything. I am interested in the cases that were deferred. When
the announcement was made in the last Parliament, I think on 20
December 1994, there was a whole tranche of cases that were deferred
at that stage. Unless you tell me differently, they will be included
in the same category. Then there are the single parents with care
who are not cooperating for whatever reasons we have talked about
earlier. Whenever this new system comes on stream, there will
be people in those categories, if not in others, who will not
have been dealt with. What is the plan to deal with people in
those categories?[5]
(Mrs Boardman) Some of those we are
already dealing with. The backlog to which I was referring earlier
of maintenance assessment contained something like 225,000 cases.
Those we have already taken out of the cupboards and are dealing
with. As I said earlier, we have dealt with half of them already
and we expect to have dealt with the remainder by the end of this
year. On the problems around non-cooperation, in the interim before
the new system, we have to rely to quite a large degree on our
closer working initiatives which we have already discussed at
some length. Clearly, we will be looking to make the most of the
new system in terms of providing better information, more face
to face counselling and support which I am sure will be of help
in that area as well as in the compliance of non-resident parents.
75. Can you tell me what the level of uncollected
debt is at present? What is the ballpark figure?[6]
(Mrs Boardman) It depends on which
basis you are looking at. In terms of debt which we believe to
be in essence uncollectable, it is of the order of about half
a billion pounds. I may need to correct myself. I think it is
slightly less than that.
76. I am not trying to catch you out. If
it is easier to send us a note, please do.
(Mrs Boardman) I think I would prefer to on this
because the figures are quite complicated.
77. The reason why I ask that is as a preliminary
to a second question which is: why do you not contemplate, if
you have the legal power, selling the accumulated debt to a commercial
enterprise on a date which people would know about and by 1 January
1999, if they had not actually reconciled their accounts with
the CSA, they would be put in the hands of the bailiffs or the
sheriff officer? Is that something you have contemplated?
(Baroness Hollis) I have not. I think it is an
interesting thought which we will contemplate.
78. I know that a lot of businesses now
do this and, even if you get a proportion of what is outstanding,
it would be better than chasing your tails for years into the
future. It is something that I think certainly is worthy of some
consideration at some length.
(Mrs Boardman) We are certainly conscious that
there are techniques, expertise and potential assistance from
the private sector in the area of debt management and debt collection.
There is an item in the Green Paper which specifically says that
we will be looking to see where we can develop active partnerships.
79. Was that what you had in mind in that
paragraph?
(Mrs Boardman) This is certainly one of the potential
areas. There may well be some others but this is one of the obvious
areas which we need to consider. Quite whether we would want to
adopt the line that you are suggesting I do not know, because
we have not done that consideration yet. There are a number of
practical issues. One of them is that our debt is very rarely
clean debt in as much as, particularly under the current system,
there is often a genuine dispute over what amount should be paid.
That often needs reference back to those concerned with the assessment
process, to chase up queries and get to the right position, because
clearly it would not be right and just to try and enforce a debt
if you were not sure that that amount was actually properly, legally
due. That does create a real, practical difficulty about following
your sort of course of suggestion, but again this is an area which
we recognise as quite a critical one. We have a fairly open mind
and we will explore a number of possibilities.
(Baroness Hollis) I will take advice.
4 See Ev. p. 19. Back
5
See Ev. p. 20. Back
6
See Ev. p. 20. Back
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