Select Committee on Social Security Minutes of Evidence

Memorandum submitted by Professor Gwynn Davis (University of Bristol) and Professor Nick Wikeley (University of Southampton) (CS 26)


  In July 1998, with our colleague Dr Richard Young (University of Oxford), we published Child Support in Action,[2] an account of an empirical study of the Child Support Agency.

  This note contains the following elements:

    —  a summary of our research findings;

    —  a summary of recommendations;

    —  a brief review of Children's Rights and Parents' Responsibilities; and

    —  an outline of some continuing concerns.


Parental attitudes

  1.  Many absent parents, whilst accepting the child maintenance obligation in principle, do not accept that it should always have first call on their resources. They take many factors into account, including the availability of Income Support.

  2.  For many parents with care, reliance upon Income Support (rather than upon some combination of employment and child maintenance from the absent parent) was entirely logical given:

    (a)  their need for a stable income;

    (b)  their own limited earning potential;

    (c)  the fact that any maintenance they were likely to receive would make only a modest contribution to the family finances; and

    (d)  the implausibility (especially for owner-occupiers) of meeting their housing costs from their own resources; and

    (e)  the cost of alternative child care.

  3.  Most parents with care believed that the absent parent ought to contribute financially, even if this had no impact upon their own financial position.

  4.  Apart from the stirrings of their own conscience, parents—whether "absent" or "with care"—lacked any incentive to co-operate with the Agency.

The formula

  5.  The complexity of the formula rendered the Agency's calculations impenetrable to most parents.

  6.  The Agency's communication with parents was itself routinised and formulaic—and this caused incomprehension and frustration.

  7.  Complex as it is, the formula inevitably fails to reflect the huge variety of family circumstances. It could, for example, result in what appeared to be perversely low assessments, especially in relation to self-employed absent parents.

The assessment process

  8.  In its early years the Agency devoted its energies to assessment, committing little of its resources to investigation or to enforcement.

  9.  The Agency commonly found itself making assessments on the basis of insufficient evidence. Indeed, this problem of a lack of evidence manifested itself at all stages of decision-making. It was a major factor in producing errors and, as a corollary, in generating reviews and appeals.


  10.  Cases were not routinely kept under review. This proved an unrealisable objective given the Agency's caseload.

  11.  The system for reviewing Agency decisions, and for considering changed financial circumstances, was rigid and compartmentalised. The Agency reviewed specific decisions—with just one decision (often not the latest decision) being subject to review, rather than the case as a whole. This was bewildering to parents and inefficient as a means of correcting error.


  12.  Compared with the resources which were devoted to assessment, the Agency appeared almost indifferent to whether the maintenance ordered was in fact being paid. In most cases it simply did not know. When the Agency was informed of non-payment, its attempts at enforcement were timorous, protracted, and largely ineffective.

  13.  In general the Agency was ill equipped to cope with parental resistance—and it encountered resistance to a quite unanticipated extent.


  14.  Child support appeal tribunals lacked decision-making power. Investigation and decision-making were separate from one another, so the appeal hearing itself lacked finality.

  15.  The impression given was that tribunals were not in the business of dispute resolution, but instead offered yet another stage of dispute processing.

  16.  Appeals were not effective in ensuring full disclosure of the parents' assets.


  17.  The child support scheme as a whole proved over-ambitious in several key respects. In particular:

    —  the Agency had too many cases;

    —  the formula was far too complex; and

    —  the schedule of periodic reviews, and the demand for change of circumstances reviews, proved way beyond what the Agency could manage effectively.

  18.  The Agency was overwhelmed by its caseload; overwhelmed by the difficulties of applying a complex formula; overwhelmed by the need to keep re-applying this formula to ever-changing circumstances; and overwhelmed by the refusal of many parents to co-operate with it in its work.

  19.  The constant policy and rule changes which the Agency was required to assimilate in its first few years themselves had a debilitating effect.


  20.  The child support scheme needs to be greatly simplified. It is inevitable that a formula-based system will deliver rough justice, but in order to be effective, it needs to be rougher yet. This applies not only to the initial assessment, but to every stage of the Agency's operations.

  21.  In keeping with this, the formula should be simplified, and it should no longer shadow Income Support rates. The central principle should be the apportionment of a percentage of the absent parent's income—this percentage to vary according to the number of children involved.

  22.  There should be a maintenance "disregard" so that the carer who is in receipt of Income Support derives some benefit from maintenance paid.

  23.  There should be a far stronger commitment to monitoring payments, and to enforcement.

  24.  In general, in devising any new scheme, the government should be pessimistic in its assumptions concerning the Agency's ability to implement its policies.

  25.  Finally, we thought it appropriate to review the location of child support work. Given that the Agency's character is very much that of a tax gathering authority, we suggested that consideration should be given to assigning the responsibility for child support assessment and collection to the Inland Revenue.


  26.  Child support liability is to be based on a percentage slice of the absent parent's net income, with the percentage varying according to the number of children involved. The calculation of "income" is to be simplified and no account is to be taken of the carer's other resources.

  27.  The departures scheme will be transmuted into a scheme for exceptional cases, with CSA officials deciding on applications for variations from the standard assessment.

  28.  There is to be a maintenance "disregard" of £10 per week for Income Support claimants. Maintenance is to be entirely disregarded when calculating Working Families' Tax Credit.

  29.  Inspectors' powers to gather information will be strengthened. Inspectors will no longer be appointed to problem cases, but instead will have a general overseeing role. They will have access to tax information.

  30.  It is said that the reformed scheme should provide a service for all parents and children, but in fact it appears (although the White Paper is far from clear on the point) that where parents are not receiving State support they will be free to negotiate child maintenance on whatever terms they wish—including, presumably, an agreement that there be no child maintenance as such. This freedom applies also to families in receipt of Working Families' Tax Credit. It is assumed that parents who are independent of the State will nonetheless find it prudent to negotiate "in the shadow" of the CSA.

  31.  Responsibility for child support is to remain with the DSS—and with the Child Support Agency.


  32.  In general we welcome the new proposals which appear far more pragmatic and realistic than the original scheme.

  33.  Considerable emphasis is laid upon the sanctions to be imposed in the event of non-compliance with the Agency's demands. Rather less detail is supplied concerning the means by which information is to be obtained and verified, or concerning the systems for checking whether payments are actually being made. These latter components are essential if we are to have an effective system.

  34.  The power of Inspectors is to be strengthened, but it is not clear how effective their oversight will be. For example, what is to be the size of each Inspector's caseload?

  35.  Still on this theme of effective administration, it is not clear how the system for gathering information from the self-employed will be improved. This is critical if the scheme as a whole is to have credibility.

  36.  The element of discretion which it is proposed be exercised by CSA officials is inherently problematic. The strength of the scheme lies in the fact that it is formulaic. Administrative mechanisms do not easily deliver discretion, except at the margins. It is not clear how the proposed discretionary element is to be limited and controlled, as it will certainly need to be.

  37.  It is not clear how the system of "periodic case checks" is to operate, nor how the Agency is to assess any claim that there has been a significant change in the absent parent's finances. This aspect of the Agency's work is always going to be problematic, and we have no easy solutions to offer, but it is important to recognise that an effective review system is (a) resource-intensive and (b) a vital component of the overall scheme. The system which we monitored was both overburdened and inflexible, and it is not entirely clear how this is to be remedied.

  38.  The White Paper refers (once again) to courts having "failed". It refers to "unsatisfactory maintenance arrangements made by . . . an adversarial court system", before expressing the government's determination not to operate "a two-tier system". Then, apparently, it concedes the principle of private negotiation in non-benefit cases. This suggests a certain incoherence, and in our view misrepresents the strengths and weaknesses of lawyer-led, private bargaining. In the past, lawyers, in negotiating a financial settlement, made as much use as they could of the parties' right to State benefits. That proved expensive for the Exchequer, and had to be stopped. But the private law system is well adapted to treating the whole of the family's finances as a package. It is a negotiation system, and it works reasonably well provided lawyers' costs are kept within bounds. There is no reason for the State to seek to take it over, other than to protect its own resources. After all, the courts regard children's interests as paramount. To date the Agency's reach (the reach required of it by government) has exceeded its grasp. A two-tier system is necessary because, where benefits are being claimed, parents must pay what they can. Where benefits are not being claimed, the court confers adequate protection.

  39.  Private bargaining will draw on whatever State resources are available. The replacement of Family Credit by Working Families' Tax Credit (calculated without reference to child maintenance) need not mean that, in future, some 30 per cent of the Agency's cases will be "private": some of these families may well choose not to involve the Agency. What it will mean is that this additional resource will be taken into account in private bargaining (so the State will be paying more—which is the down side). On the other hand the Agency will have fewer cases (which we take to be a positive feature).

  40.  Separated parents move in and out of benefit. It is burdensome for the Agency to have to calculate maintenance liability afresh on each occasion. That is one reason why it is hoped that private settlements will "shadow" Agency rates as far as the child maintenance component is concerned. It will be in the interest of absent parents to ensure that they do so. But it is not feasible for this "shadowing" to be imposed by government, and it has to be accepted—and taken into account in calculating the overall burden of work carried by the Agency—that many parents with care will move in and out of benefit, and that this will call for re-assessment of maintenance on each occasion.

Gwynn Davis and Nick Wikeley

September 1999

2  Hart Publishing, ISBN 1-901362-70 Back

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries

© Parliamentary copyright 1999
Prepared 15 October 1999