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27 Jan 2003 : Column 573—continued
Mr. Gary Streeter (South-West Devon): For some years now, the CSA has been adept at collecting straightforward amounts of maintenance from people on PAYE—fathers, generally speaking—so that their children are properly maintained. What in the new system will help the CSA to collect money from people in small businesses and those whose financial circumstances are complex or opaque? Let us face it: the CSA has not been good at collecting money from such people, and children all over the country are being short-changed. Will the Secretary of State assure us that the new system will help the CSA to perform that task?
Mr. Smith: Yes, it will. It is simpler and more straightforward, and there is not the same scope for the endless special pleading that is almost designed into the existing system, with the 100-plus pieces of information that may be relevant to an assessment. In addition, as I have said, it will release staff resources for a more dedicated enforcement effort. We collaborate closely with the Inland Revenue and we will have access to its records, which should help with the problem of the self-employed that the hon. Gentleman identified.
Mr. Frank Field (Birkenhead): May I commiserate with the Secretary of Secretary, because once the Government decided not to base the reform on a simple tax rate he was presented with a reform that would be difficult to deliver? So may I congratulate him on extending way into the distance the date on which we bring existing claimants on to the new active register? Does he accept, however, that given that the reform was announced in 2000, many of our constituents feel a sense of grievance about the level at which they pay maintenance? Will he help them to sue EDS for compensation for the further delay of what is a necessary reform?
Mr. Smith: I thank my right hon. Friend for his congratulations and commiserations. I am sorry to say, however, that I cannot support his plea for money to sue EDS. As I said, we have a long-term partnership for delivery with EDS. I am satisfied that the system will work. We have reached an agreement with it on how the costs are to be shared. That has both incentivised levels of performance and secured the best deal for the taxpayer achievable in the circumstances.
Mrs. Angela Browning (Tiverton and Honiton): While the Secretary of State makes the changes, will he take another look at the procedures for attachment of earnings orders? I am worried that the CSA is not rigorous enough in ensuring that employers pay regularly when it has made an order, because the liability remains with the parent whose wages are being deducted. If a company goes broke after making no payments to the CSA for weeks the parent with responsibility is still required to pick up the tab.
Mr. Smith: I should be pleased to look into any cases that the hon. Lady draws to my attention and will raise
with officials the issue that she poses. It is important in operating the new system that attachment of earnings and so on are enforced in a way that is business friendly. However, we must also respect client privacy. For example, arrangements will be made for clients to be rung at home rather than at work; we are learning from past mistakes.
Rob Marris (Wolverhampton, South-West): Since the Minister first mooted changes to the 10, 15, 25 per cent. and so on, he has published a Green Paper on pension reform. I notice that the percentages refer to net income, including pension contributions. The Green Paper sets out a lifetime savings in pensions of £1.4 million. Will he assure me that, to use his word, "robust" action will be taken to stop recalcitrant non-resident parents boosting their pension contributions, thereby depressing the amount that they should pay for their children?
Mr. Smith: The system is simple and straightforward. My hon. Friend invites me to add complexities and bureaucratic regulation to it. I am sure that similar invitations will be made along the way. I understand his point, but we will best get money to parents with care and the children who need it by keeping the system simple.
Alistair Burt (North-East Bedfordshire): As one who bears as many ministerial scars as many others do in relation to the Child Support Agency, I simply say that although we are all equally vociferous and critical of our relative roles in making the agency work, we should never forget that collectively as a House it was our failure to keep our eye on the ball as the legislation was passed that caused many of the difficulties that both Governments have sought to repair.
Will the right hon. Gentleman do his best to look at two issues that remain at the core of concerns? The first is the repeated messages issued by the Child Support Agency bearing erroneous figures that people are asked to accept and the frequent changes that it makes to those figures. If the new system does something about that, it will be greatly welcomed. Secondly, on the phase-in, I urge the Secretary of State to remember that people feel a sense of injustice if they know that they will pay less in future, yet are forced to pay more for a lengthy period of time. Will he do his best to make sure that the phase-in period is as tight as possible?
Mr. Smith: Yes, the new system, as I said, is much simpler, so it should dramatically cut the errors that, we recall, were made when the CSA started nearly 10 years ago. We all remember people coming to our advice surgeries clutching half a dozen envelopes that they had received in a fortnight all giving different assessments based on different criteria. That has been getting better, as I said, but to operate effectively the system must be kept simple, which is why we have cut dramatically the 100-plus variables that were previously part of the calculation.
As for the feelings of resentment or frustration that people may experience because the new system will operate on a more favourable basis, that is why, along with the merits of everybody knowing where they stand and being treated consistently, and all recipients of income support and jobseeker's allowance getting the
child premium, it makes sense to move to C-day—conversion day—as quickly as possible. Just as it would have been wrong to rush the initial move to the new system until the IT was right, I shall not speculate about a date until I know when we can deliver.
Mr. Bill O'Brien (Normanton): The new transparent and fair system is welcome, but we must have regard for the fact that, under the old system, a third of children did not receive the maintenance to which they were entitled and that both parents are responsible for paying maintenance. Will my right hon. Friend act to ensure that children who are being denied maintenance receive urgent consideration by the Child Support Agency to ensure that they receive their entitlement? The CSA was guilty of maladministration under the old system, so will he agree to an appeals procedure to determine the level of compensation to be paid by the CSA when maladministration has occurred?
Mr. Smith: I thank my hon. Friend for his welcome, and am pleased to confirm that, of course, we will step up action so that payment is made to parents with care who are not currently receiving it. I shall look at his point about compensation, but I think that there are established procedures on the levels of compensation arising from ombudsman cases. As for reminding people of the importance of meeting their child support obligations, despite the banter between parties about the history of the CSA, there is a unity of purpose in the House. It would be good if a united message could go out from the Chamber that we all believe that both parents need fully to meet their responsibilities for their children, whether financial or otherwise.
Miss Julie Kirkbride (Bromsgrove): The Minister will be all too aware of many absent parents' sensitivity about child support payments. Members have said that among our constituents who will pay less under the new scheme than they do at present there will be a tremendous urge to be transferred to the new system of payment. Will the right hon. Gentleman help the House a little by giving a possible time scale and say what is the earliest date for the transfer of existing payments? With reference to a previous question, can he explain how he will begin to transfer those people to the new system? Will the phasing-in be based on an alphabetical, regional or other system?
Mr. Smith: I am afraid that I cannot offer the hon. Lady much comfort. For reasons that I have given, I shall not be tempted to speculate about dates without knowing how the new arrangements are working. She says that those who look forward to paying less will welcome an early move, but there is another side to the equation: those who receive more now than they will in future might not look forward to the move quite as much.
As a result of the sometimes significant shifts that can be involved, we shall phase in changed assessments, which could take more than five years, so that people do not face too sharp an increase or fall in the sum they are paying. I will set out the basis on which the conversion of cases will take place when we are ready to do so. I am not in a position to do so at the moment.
Mrs. Ann Cryer (Keighley): May I seek further assurances on whether the changes will have any bearing
on the many self-employed, non-resident parents who seem to get away with paying very little towards their children's upkeep despite a fairly affluent lifestyle?
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