Examination of Witnesses (Questions 80-99)
MR DOUG
SMITH, MR
VINCE GASKELL
AND MR
MARK NEALE
WEDNESDAY 22 MAY 2002
80. I know from speaking to non-resident parents
that they are getting very angry and very frustrated and they
come to my advice surgeries and say explicitly to me that they
are not going to play ball with the new system, they are so fed
up. Is there then the chance that delays can lead to increasing
non-compliance and non-co-operation with the CSA from your existing
non-resident parents?
(Mr Smith) I have not seen any evidence that delay
in implementation has had an adverse impact on compliance. Indeed,
all that we have done in the run-up to what we assumed would be
an April implementation has on the evidence improved compliance
and improved enforcement. I think the message so far is entirely
the other way, that the risk for us, being completely open, as
we have moved into a period where we start to migrate existing
cases from the current scheme to the new scheme is that those
people who see a reduction in payment as they come into the new
scheme may choose to put that payment into implementation immediately
rather than from the common dates on which the new assessment
will apply. We recognise that risk and we know the need for more
effort into compliance around those individuals who seek to take
advantage of that.
81. But, you see, I am also getting complaints
from people who have worked out exactly what their new payments
are going to be and for their own particular circumstances that
is often a very substantial reduction. They know that not only
are they going to have to wait for a long time before they are
brought on to the new scheme, but even once they are brought on
to the new scheme the changeover of payments for many of them
will be phased in because of the big change in the level of payments.
We all understand that from the point of view of the parent carer
who does not want to see a substantial reduction overnight in
the amounts of money that she is getting, but nevertheless for
the non-resident parent one of them actually worked out that his
child is going to be 16 before he thinks that he will get down
to what the level should be under the new system, should that
new system ever come in, and so of course what they say to me
is, "You are denying me my human rights. You as an MP have
changed the law, the law is not being implemented, I am financially
disadvantaged. I want compensation." What do you say to somebody
like that?
(Mr Smith) I say in a nutshell that we are here to
operate and enforce the law as it is legislated rather than how
people would wish it to be and the law will take effect when MPs
decide when the law will take effect.
82. I am just reminding you that there are a
lot of unhappy people out there. One final issue to do with non-resident
parents. You will recall that because of the difficulties in applying
the horrendously complex formula, for many non-resident parents
they have built up, through no fault of their own, very substantial
arrears because the calculations started from that initial moment
of the CSA dealing with their claim, and in recognition of the
fact that the very substantial arrears were often built up because
of delays by the CSA there was the opportunity for those non-resident
parents to reach an agreement with the CSA so that they only paid
arrears over the previous six months and then the other arrears
were cleared. I understand that that scheme was time limited to
this April. The assurance at the time was that the Agency hoped
that the calculations and the arrears would be dealt with so that
you would not have as many people who fell into that group, but
what about the people who are still in that group who are now
being denied the opportunity for co-operating and as part of the
co-operation having some of those arrears wiped off? Have you
solved the problem with regard to the backlog so that there are
not going to be parents in this group and, if you have not solved
the problem about the backlog and there are parents who are still
in this group, can you extend that scheme?
(Mr Neale) What you have said is exactly right. This
is something called the deferred debt scheme and it did come to
an end in April when we were expecting the new arrangements to
go live. Ministers are currently looking at re-activating the
scheme. As things stand there is a continuing backlog of cases.
83. Certainly I would urge you to keep the scheme
running to at least offer something to these non-resident parents.
May I finally go back to the question about your correspondence
with your client group? Mr Darling, the Secretary of State, when
he made his statement to the House on 20 March[4],
actually said: "The Department has written to new people—as
it was duty bound to do—telling them about the plan to introduce
the new system at the end of April. We will write to them again,
as it is clear that we cannot in fact bring them on to the new
system at the end of April." How does that fit into what
you were saying? Clearly existing clients were not going to be
brought in at the end of April, but you had written to everybody
and given them an understanding that they were going to be brought
in when the reassurances were given. The Secretary of State seems
to have given an indication here, an assurance, that you were
going to explain this to people but you did not.
(Mr Smith) I do not want to introduce
elements of sophistry into that. I think that statement is capable
of being interpreted in more than one way. We will be writing
to all our clients again when we have some news for them. The
news that I hope we will be able to give them will follow the
next statement that is made by the Secretary of State in the House
of Commons which will be an indication of when we expect the new
arrangements to apply to new cases, and again comments on the
impact of that statement on the existing caseload.
Mrs Humble: Chair, I think it is important that
all your clients do know exactly what is happening with regard
to them and have assurance as soon as possible about future dates
when they are going to be transferred and of course we have concerns
about new clients coming on who have an expectation that they
would be brought in April and that has not been the case.
James Purnell
84. I want to ask a few questions about the
implications of the delay for your staff. Your business plan refers
to a large amount of training that was going to go on to prepare
for the reform and presumably the implementation of the IT system.
Can you update us on whether that training has taken place and,
if so, whether you are worried that people will be rusty by the
time the IT system is implemented and whether you will be having
refresher courses or whether you have stood down people from training
pending the implementation of the IT system?
(Mr Smith) The direct answer to the question is that
we have stood down people from their courses and we want to make
sure that the training that we provide to people is what we call
"just-in-time" training. It is training we can move
into use very quickly after we implement the arrangements. That
is not to say that we have deferred the entirety of our training
programme. We are looking to see if there are any elements in
the training programme for child support reform that we can accelerate
and gain some immediate business benefit from running them. One
of the courses in particular, relating to telephone negotiating
skills and the ability to build relationships with people by telephone,
is something where we think we can utilise for our staff and get
very immediate business benefit and benefit to clients from by
pulling forward the mainstream of the child support reform training.
We will probably seek to do that in the first half of this year
because that is a generic and long-term benefit.
85. We have also had a memorandum from the Public
and Commercial Services Union who say that the current scarcity
of information about the new start date only serves to lower morale
and foster rumour. Are you worried about this and what are you
doing to reassure staff?
(Mr Smith) I am worried about anything that impacts
on the morale of our staff because they have a tough job to do
at the best of times and they need all the support and help with
coaching they can get to do that job. I make a point of spending
as much time as I can in business units. Normally at least a day
a week I speak face to face, most months, with between 400 and
600 staff. I firmly want to tune in to what they are thinking
and doing about this. It is uncomfortable for them not to have
a firm date for the implementation inevitably, but our job as
managers is to focus them on what they need to do week in, week
out, month in, month out, to deliver the standard of service that
we want to deliver through the Agency, and increasingly our people
understand the message. When you can get the opportunity to talk
with them and explain the background of the difficulty in establishing
firm dates, they do understand this issue. Communication is not
necessarily about drafting fine words and making sure everybody
gets a piece of paper on the desk week in, week out. It is about
ensuring that senior managers in particular understand the complexity
of these issues, are comfortable with them and are able to engage
with staff on a face-to-face basis and talk them through this,
and increasingly we are getting better at that.
86. I have sympathy with why you were not wanting
to be drawn into simple fault sharing earlier on between yourselves
and EDS, but presumably you would agree, given what you have just
said, that it was not the fault of the staff involved that the
delay in the IT system has occurred.?
(Mr Smith) I think our staff did everything we might
have expected them to do to prepare the Agency for a go-live effort.
I take each and every opportunity I can get to properly recognise
that and thank them for it.
87. Can I give you another opportunity? The
PCS have told us that staff are worried that because their bonus
was dependent on the implementation of the system and because
the system has been delayed, completion of the reforms depended
on the implementation of the IT system and so their bonus will
not be paid out because of no fault of their own. Can you reassure
them that their bonus will be paid if you agree, as you have just
said, that the delay was not their fault?
(Mr Smith) Yes. The bonus payments under the latest
arrangements are funded separately by colleagues in the Treasury
and since we have taken the decision to defer implementation I
have entered into discussions with the Treasury about the appropriate
amount of the bonus that should be paid. As soon as I reach agreement
with the Treasury and with Ministers we will make an announcement.
Mr Stewart
88. We were told in a ministerial reply[5]
on Monday that you have around 700 staff vacancies at the moment,
which is extremely worrying when you are doing the important work
that you do. Can you give the Committee a brief update on what
you are doing to try and fill those vacancies?
(Mr Smith) We have active recruitment
programmes in place at each of our business units. We do recruit
on a regular basis and at most of our business units, not all,
recruitment is not a big issue for us. Our biggest issue is retention
of people and staying ahead of the job offers. I outlined to a
previous meeting of this Committee, the introductory meeting,
the sort of staffing profile that we have. We largely employ people
at the lower end of pay scales. Our workforce is predominantly
young. Almost by definition, given that profile, we are going
to have a higher turnover of staff than many other organisations,
partly because people move on to develop their careers in a world
where you don't develop your career wholly in one organisation,
and partly because many of the people that we bring into the Agency
work with us for a while and take off and develop further education
opportunities, which is right and proper, so we do have a higher
turnover than we might wish and than other organisations have.
We have an extra job to do to try and keep ahead of the profile
of recruitment.
Chairman
89. Am I right in thinking you did a staff baseline
survey last May to test some staff attitudes?
(Mr Smith) That is right.
90. Is that an annual exercise?
(Mr Smith) It is becoming an annual exercise. It is
something that I would like to do more often than annually. If
there is one thing I believe in passionately it is understanding
what my staff are thinking at any moment in time. We did a survey
last year. The Department in general will do a survey this year
and the Child Support Agency will have its section of that departmental
survey. I certainly want to develop arrangements into the future
that keep a regular form of survey going, if possible a bit more
often than annually.
91. If there is a more up-to-date result than
May 2001 could we have sight of the result?
(Mr Smith) That is not until the Department conducts
its survey this summer, and then we will update ours, obviously.
92. Because last May in the baseline staff study
although it showed that 97 per cent of staff knew about the reforms
only 30 per cent of them could say that they felt they had been
well planned. What do you suppose the rate would be now?
(Mr Smith) I would not like to hazard a guess on that
one. I think staff may well think that the planning has been good
for reform. It is the actual delivery that leaves something to
be desired.
93. That is quite a good answer. Forty per cent
of staff said that they had more work to do than they could cope
with; that was in May 2001. Do you think that is still true now?
(Mr Smith) That is a difficult one to form a judgment
on. I do talk with people regularly. One person who has got more
work than they can cope with is another person's reasonable workload.
It is difficult to get underneath that sort of figure without
talking with people about it.
94. Paying them more maybe?
(Mr Smith) Managing them better may equally have significant
impact.
95. I will concede managing them better if you
concede paying them more.
(Mr Smith) Pay is not within my remit.
96. It is a serious question. As a system the
whole welfare-to-work system works in different locational contexts,
where obviously in London it is a problem, a problem which we
are finding more and more. In a constituency like mine in Scotland
you are as an employer a very good employer. The rates are good,
there is security of employment, it is high quality work, but
you cannot possibly expect people working in competition with
the financial sector in centres like Manchester and London to
be able to hold the quality of people you need to get the work
levels to the level of accuracy that you are aspiring to by paying
them £12,000 a year. You just cannot do it.
(Mr Smith) I will accept that the pay structure and
the pay levels within the Agency could be improved.
97. Are they being reviewed?
(Mr Smith) They are being reviewed actively and we
are developing at departmental level a longer-term pay strategy
for the Department and within the Agency I am looking at how we
can utilise the fact that we are creating new skill sets and new
skill bases for people as we move through the child support reform
programme to make the case for grading all pay structures to change
as a result of that. That we will do. It is worth bearing in mind
though that the locations of most of our offices are not in the
high pay financial sectors. It is where often we are market leaders—Hastings,
Falkirk, Dudley, Birkenhead. These are not hot spots of higher
pay, which is why I do place at least equal weight on the need
to manage people better than we traditionally have done. That
is why one of my first decisions at the Agency was to make a conscious
and significant investment in putting proper development and training
facilities in place for our managers so that we can encourage
them to do the job that we expect them to do. That includes providing
coaching and support for individual staff members. That level
of coaching and support for the individual staff members is at
least as important as whether they are getting paid five or ten
pounds more.
98. Are all these new pay grade reviews contingent
on the introduction of the new computer system working?
(Mr Smith) It is contingent on them operating the
new skills set inside CSR, so on that definition yes, we need
the new computer system in place to do that.
Mr Stewart
99. As we have previously discussed, compliance
by non-resident parents will be a key indicator of success of
the new reforms. Can you tell me what plans you have to redirect
staff or resources away from making assessments to ensure compliance?
(Mr Smith) I go back in a sense to an answer that
I gave earlier, that the key determinant for compliance is getting
the non-resident parent to comply as close as possible to the
events which have led to an assessment being made. The key thing
that we do as we move through the reform programme is to ensure
that people are dealing with applications very quickly indeed
after receipt, and then when we deal with the application we are
in touch with the non-resident parent within days by telephone
so that we actually open up a proper discussion about their responsibilities,
the amounts that are due and the compliance requirements of the
new system. The whole intention of this is to ensure that people
are compliant from day one and we are not constantly fire-fighting
because we let people drift into non-compliance over a period
of time and then attempt to move into a recovery position when
someone is already significantly in debt. That has got to be the
right way round. That is why a large component of the training
package for child support reform implementation is focused on
these relationship issues and how to better use the telephone,
how to build a relationship over the telephone, how to engage
in discussion about money over the telephone in an emotionally
fraught situation. These are things which are difficult to train
people up to. It is difficult to develop people to do well but
they are an essential component of the new system. This is not
really a question of shifting resources but of changing the entire
culture at the front-end of our business. They are literally spending
less time going through the paper and keying figures into the
system. The time is spent instead in this sort of discussion.
That is one of the crucial determinants of whether we get the
new reform arrangements off the ground. It is not our ability
to shuffle the paper through an IT system and spew something out
at the other end with the right answer. Important though that
is, it is the relationships we build as we take people through
the process because that is the determinant on whether long term
they are going to be compliant or whether they are going to drift
into non-compliance.
4 20 March 2002, Official Report, column 315. Back
5
20 May 2002, Official Report, column 11. Back
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