Examination of Witnesses (Questions 360
- 367)
WEDNESDAY 15 SEPTEMBER 1999
PROFESSOR JONATHAN
BRADSHAW AND
PROFESSOR JANE
MILLAR
360. I will put one counter-argument that was
given this morning and that was the Inland Revenue deals with
declared accounts but we all have instances of people who are
self-employed who declare a very small profit for tax purposes.
The suggestion was put to us that judges in court have more flexibility,
more leeway, they can look at people's lifestyles and say "given
your lifestyle we award a certain level of payment". How
do you weigh that into the balance? What actually happens in Australia,
do they have similar cases of people who live in large houses
and drive big cars and yet are paying tuppence ha'penny for their
children, or whatever a dollar is over there?
(Professor Millar) I am sorry but I do not think I
can say much about that, I would need to get more information.
The point that Jonathan was just making, but I was also making
earlier, about separating the setting of what the child support
liability is, and then the issue of how you collect and how you
pay that out, in a sense what Jonathan was arguing was that the
Inland Revenue could be involved in the collecting of that money
but not necessarily in the setting of it. If that were the case
then the issues that you are talking about today of responding
more flexibly to people who are self-employed or with incomes
that are harder to determine, it would make sense for that not
to be part of what the Inland Revenue was doing, but that is not
to say that the Inland Revenue would not be the right place for
collecting this money in.
(Professor Bradshaw) If we had a tribunal system within
the CSA system which had the capacity to be flexible at the margins,
parents with care would go to that tribunal and say "look,
this guy is hiding this income, these assets" and they would
not be completely governed by the formula, they would be able
to do what the courts do which is to take into account earnings
capacity and impose something different from the formula driven
system. This problem of hiding resources could be dealt with if
there was a flexibility at the margins of the CSA system or some
way for the courts to provide that service, but it cannot be done
with a rigidly imposed formula within the disciplines of social
security.
361. Would you see that having special relevance
to those who have investment income? Under the White Paper rules
investment income usually is not going to be taken into account
unless somebody has very substantial investment income and that
is their main source of income. One of the problems for the parent
with care is to prove that the non-resident parent does have that
huge amount of investment income. Would you see the tribunal playing
a role in that? As I understand it the proposals are that there
will be officers of the CSA who will initially decide whether
or not there is a case here for a departure or whatever it is
going to be called with the new system. How can we help the parent
with care in those circumstances to try to prove that the non-resident
parent actually does have this income that they are hiding?
(Professor Bradshaw) I am not sure. I think you have
probably got to learn from what the courts do. They ask for loads
of documents in evidence before these things are settled and take
into account all different kinds of resources. Within a formula
driven scheme you cannot do that, you have just got to have a
very simple definition of what income is going to be taken into
account and disregard the rest. That is one of the problems about
dealing with these problems through rough justice.
Mr Leigh
362. Your value to this Committee is that you
have conducted a very considerable amount of research over a long
period, Professor Bradshaw, on parental attitudes and you summarise
this in paragraph 28 of your submission where you say: "The
results of this research show that the child support scheme has
a very limited prospect of success unless it is based on negotiation
between the parents, which is recognised as fair and the perception
of fairness on the father's part depends more than anything on
their ability (and the former partner's willingness) to have shared
parental responsibility of their children." Then finally
in paragraph 43 you say, "We should be demanding that the
Lord Chancellor and the Secretary of State for Social Security
develop a joint approach to the settlement of issues following
relationship breakdowns". Now, interestingly, this is actually
almost exactly the same sort of evidence that was presented at
the beginning of this afternoon by the National Association for
Child Support Action and, coming from different points of view,
you seem to be suggesting the same sort of thing, but I have got
to put to you the same question that I put to them and they could
not answer because they defended themselves by saying they were
not a research organisation. How much is all this going to cost?
(Professor Bradshaw) I think I would probably answer
you in the same way as they did. I am afraid I have not done the
costings and also, and I was preparing to say this, I do not think
it is the job of voluntary bodies and certainly not researchers
to design policy and then do detailed costings of it. One of the
things which I think is disappointing about the Green Paper and
the White Paper is that they did not look at the alternative options
and evaluate them and say, "Look, if we had gone down this
route, it would have cost us much too much. Therefore, we didn't
go down it". They did not do that work and I think that it
should have been done. They started from where they were and they
just shifted forward a bit. Obviously in the light of what has
happened in the last five/seven years, to go back to a court system
is a very radical proposal and does need to be thought through,
but it is a pity that this opportunity of reform did not try to
think it through, particularly in the light of what has happened
to the Family Law Act.
363. I wanted to ask you about that because
I was particularly interested in the Family Law Act and I was
behind many amendments to that Act which were trying to promote
the whole concept of mediation which apparently is now in a state
of collapse. However, we still accept proposals, do we not, under
the Family Law Act that a divorce should not be finalised until
these matters of maintenance are settled, so I just wonder, if
your ideas were adopted, whether we are talking about a hugely
expensive process? After all, if we are talking about people getting
divorced, everybody is going to the court anyway and everybody,
as they get divorced, is talking in terms of access, custody,
and potentially about finance as well. Could we not put much more
emphasis on these matters in the divorce process?
(Professor Bradshaw) No, I do not think it is radically
different. The people who are not covered by the CSA are already
settling their maintenance arrangements privately in the courts
and registering their agreements with the courts, and they are
not just settling maintenance and child support, but they are
settling capital, access, property and that is the system which,
because of the failure of the CSA, we have left for those people
who are beyond the scope of means-tested benefits. What we are
proposing to do with these reforms is to emphasise once again
a distinction between agreements about child support and agreements
about all those other things. Separate institutions are going
to be doing the work and drag some people who are presently getting
settlements in the court back into the CSA system, in jeopardy
once again of the success of a formula-driven child support system.
No, I do not think it is a big step to send the kind of maintenance
responsibilities back in to the courts with some of the skills
learned from the CSA and lessons learned about enforcement and
collection.
Chairman
364. Going back to something you said earlier
about trying to work out what the proportion of budget is spent
on the upkeep and maintenance of children, is it your view that
the Family Budget Unit has done the best and the most accessible
work that would give us some kind of feel for that? Is there any
other body of evidence that you know about which would help us
work out whether the 15/20/25 per cent fixed formula addresses
the costs adequately? Have you a view about it?
(Professor Bradshaw) If you ask the academic community,
you would get equally arcane and different answers from economists
and social policy academics and nutritionists and so on, but I
am an advocate of the power of budget standards for setting standards
of living and I think that the work that was done on the cost
of the child is very authoritative and because it has the value
of being very flexible. If a person decides that what is included
in the cost of the child, is not right, it can be changed. It
is not a scientific process, it is a very boring kind of clerical
process of costing what children need, although it does provide
a useful mechanism for assessing the cost of the child. It is
not the only work and there are other ways of doing it.
365. I think we may as a Committee decide that
we might try and get them to submit some evidence on the background
to that recommendation. Just a final question from me, changing
the subject slightly, which is that we are picking up some nervousness
about the transitional process from the current system to the
new system and the Minister was quite clear when she said that
she was not going to put the existing cases into the new system
until she was sure that the new system was efficiently operating.
Are there any kind of academic tests that you could set that would
give some satisfaction or some confidence that the new system
was working before you took the leap of putting the present cases
into it? Is that an impossible set of questions to answer, to
be sure that you were not actually going to suddenly, or you would
not do it suddenly, but you would start feeding it through, but
that the existing cases could then be merged into the new system?
(Professor Bradshaw) Can I try to answer it rather
tangentially. One of the things that the Department of Social
Security has been doing more of recently is experimenting and
having trials and it seems to me that this scheme, if it goes
ahead more or less on the lines being proposed, is a prime candidate
for trialing and having a systematic evaluation of the trials,
so that would be the kind of source of evidence on whether it
was working. Going back to my special pleading about research,
there was no systematic evaluation launched of the child support
scheme whatsoever. Those people who have done the research on
it have done it kind of by chance really and it would be a very
good thing for the next tranche of policy in this area to be monitored
more carefully.
366. How long would it take to do really well,
really professionally and assess it? How long would it take?
(Professor Millar) I was going to make the same point
about piloting and trying it out in different areas. You would
have to be very clear about what you were looking for in terms
of success measures, as it were, so how you were going to decide
what was successful. That does not mean that you could not make
those decisions and pilot the scheme and test it out in twelve
months.
367. And have the results in twelve months?
(Professor Millar) Well, it depends, but you can begin
to look at what difference it is making in terms of getting payments.
Chairman: We could continue this for the rest
of the week, I am sure, but that has been extremely valuable and
I am very grateful to you both and your efforts will inform our
process really extremely well. Thank you very much for your time
and for your appearance.
|