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Child Support Agency

2.30 pm

Sandra Gidley (Romsey) (LD): I am pleased to have the opportunity to debate the Child Support Agency and its performance. I must admit that my initial motivation for asking for the debate was a deep and prolonged sense of frustration over my dealings with the CSA as a constituency MP. I am sure that I am not the only Member whose heart sinks when the three little letters "CSA" are spoken at a surgery. Almost invariably, I am faced with parents at the end of their tether, and frequently children are used to get back at an ex-spouse.

Clearly, the agency cannot be held responsible for the individual morality problem that exacerbates whatever else is happening, but it can be held responsible for the inconsistency and delays that are integral to dealing with the CSA. Although the debate is reasonably well attended for one in this Chamber, I am surprised that so few Members are here. Perhaps my experience is unique, but I have been led to believe that other Members share similar experiences to mine.

I shall use a few constituency cases to highlight some problems that I have encountered, but it is first worth picking up on the Work and Pensions Committee report on the CSA. It was written in January 2004 and things have not improved. The Committee described the CSA as

Management was criticised, problems with accuracy and the IT system were highlighted, and the Committee concluded that much greater focus should be placed on compliance and enforcement.

When more than £1 billion of maintenance is written off in one year, it is clear that the problems are large scale. I wholeheartedly support the Committee's recommendation, because the most frustrating cases for a constituency MP are those where one parent is not receiving money from the other. In those circumstances, the second parents often find a way to buck the system—or they think they have—when it is just a matter of the problem not having been investigated.

The Government's response to the report was that compliance had reached 75 per cent. We can argue about those figures all we like—numerous tables have shown that compliance is probably less than 75 per cent.—but even if that percentage is correct, it is far from good enough because it means that the system is not working for a quarter of cases. As the CSA provides a service for approximately 1,430,00 cases, that means that each MP deals with about 2,250 cases, so hon. Members will understand why I am surprised that more of us are not present today. More than 500 of those cases will be non-compliant.

Parliamentary questions have revealed that my estimate of non-compliance could be conservative. Some estimates show that more than 400,000 people resist payment, while one alarming analysis showed that only 271 members of staff are designated to deal with the problem of non-compliance. That means that each member of staff has a case load of about 1,550 cases, so it is hardly surprising that so few cases are resolved. It is a small miracle that there are not many more CSA cases at our surgeries.
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It came as no great surprise to anyone that at the recent Labour party conference the Secretary of State for Work and Pensions promised root and branch reform—it has been promised for years, but has not happened—and admitted that the current operation is a complete shambles.

Some problems have arisen because of a change from the old child support scheme to a new, simpler model. The old scheme was complex, and more than 100 pieces of information were required to make a full assessment. The Child Support Act 1999 established the new scheme, which is designed to work on a simple percentage of the non-resident parent's net income. The non-resident parent pays 15 per cent. for one child, 20 per cent. for two children and 25 per cent. for three or more children. Maintenance is reduced if the non-resident parent has a second family, is on a low income or shares overnight caring responsibilities for the child with the parent with care. The simpler scheme made provision for maintenance arrangements to be established within six weeks, and there was supposed to be greater focus on ensuring compliance.

Unfortunately, the scheme was delayed several times because of IT problems. It was initially planned for the end of 2001, but was finally introduced, for new cases only, from 3 March 2003. The idea was to bring existing cases forward once the system was working well, but there is some evidence that, to try to make the initial figures look good, a large number of supposedly simple and straightforward cases were stockpiled so that they could be processed quickly under the new scheme. Many of them are still waiting somewhere in the system. It would be useful if the Minister elaborated on what is being done to deal with that backlog.

Constituency cases highlight interesting problems. A woman with three children left her husband because of his violent behaviour. She worked hard to pay off the family debts while the father consistently refused to pay maintenance through the CSA. The two older sons are now grown up, and the younger son has decided to live with his father. Hon. Members can probably guess what is coming next. The ex-husband has claimed child maintenance from his ex-wife through the CSA. He is perfectly entitled to do that under existing regulations. However, although the ex-wife is owed £10,000 after approximately eight years of non-payment, £42 a week is deducted at source from her wages now that she is required to make CSA payments. She must pay the money.

The flaw in the system is that the two cases are treated entirely independently and cannot be linked in any way. I was hoping that the CSA would be sympathetic to my constituent's plight, as she has struggled for years to find the money to support her sons, but it said that its main concern was for the child's welfare. Understandably, my constituent took great exception to the implication that she was not considering her child's welfare, as she had taken on that responsibility for eight years.

I urge the Minister to ensure that a compliant parent is not treated with what I can only regard as a complete lack of sympathy by the CSA in cases where there is a huge outstanding debt. In future, there ought to be some way of linking such cases so that the debt can be taken into account. The reality is that the compliant parent
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would probably spend some of the money on the children anyway. It is almost as if they are being doubly penalised.

The case gets worse. The CSA was considering court action against the ex-husband as long ago as 2000, and it confirmed that it was still considering court action in 2002, but it appears not to have taken any action to recover the money, despite being given a great deal of information by my constituent as to where the ex-husband worked, how he earned his money and even how he was evading notice.

I also have a case of a woman on a low income who was paying a small amount of money in maintenance under the old rules. The father contacted her, ostensibly to say that it would be easier to forget the payment as the amount was so small. This woman understood her ex-husband rather well and realised that that sudden turn of generosity was somewhat out of character. So she was suspicious. She checked with the CSA and was told, "Don't worry about it, he won't be able to claim back. There is a time limit, so there is nothing to worry about." Unfortunately, she was not given the complete picture. As soon as the 13-week time limit expired, a new claim was submitted and my constituent became liable for greatly increased payments.

The new legislation may have an unintended consequence. As women are traditionally less well paid, when they pay maintenance, as happens in a small number of cases, they will often, under the new rules, become liable for a higher proportion of their low wage—a large amount of money—because of the percentages involved. In a couple of my cases, the women have become the victims of circumstances being changed in such a way by the man. It would be interesting if the Minister told us whether he is alert to that problem. Has any work been done to assess the impact on low-paid women who are liable for payments to the CSA?

The most commonly encountered problem is payment processing being subject to unacceptable delays. A case of mine involves a woman whose partner was, happily, making payments to the CSA. Unfortunately, the computer was unable to process the payments, although in this particular case I am not sure why. Last year, however, I had an interesting case in which the excuse for the inability of the computer to recognise the sort code was that it began with a zero. Perhaps I am being naive, but we are talking about an IT system for large amounts of money. It should not be that difficult to tweak things so that a sort code beginning with zero can be recognised.

Small problems such as that should be surmountable. They are obviously a source of deep frustration. The woman I mentioned was told that a manual payment would have to be set up and that that would take 13 weeks. That originally meant that she would have had to wait until Christmas for the money, but staff at my constituency office were very pleased when they were told that she would be paid by the end of October. I take no credit for that, as they arranged it. However, this very constituent was on the phone only this morning, after I had written this speech, to say she had received a letter informing her that there would be a further five-week delay in processing the money.
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I have to ask the Minister how long it takes to generate a letter or process a manual payment. It seems to me that a lot of time is wasted sending out letters to people saying that there is going to be a further delay. It would also be helpful if he said what measures are being taken to increase staff numbers, albeit temporarily, to try to clear the backlog of cases so that we can get on an even keel.

From my reading in preparation for this debate, I understand that for only two months of the past couple of years has the CSA processed a greater number of cases than came in. That imbalance cannot continue and it would help us all, as constituency MPs, if we knew what is to be done to resolve the problem. It may be due to yet another queue for the CSA, or an administrative nightmare, but we are talking about people's lives.

My constituent said, "To top the lot, I now have to go to court for non-payment of council tax because all my money is sitting at the CSA. I have to feed and clothe my children, and something had to give. I could not afford to do it all." Given the knock-on effects that delays cause, the issue must be resolved sooner rather than later.

In many cases, one-parent families are involved. The One Parent Families organisation has raised a number of concerns. In a briefing to me, it stated that the average clearing time for new cases is now 25 weeks and that 31 per cent. of cases take more than six months. During that time, families often do without money that they can ill afford not to have. It also claimed that 78,000 old-scheme cases were still awaiting reassessment from before 2003, and that a further stockpile of new cases had accumulated in the six months or so before the new scheme began. If the Minister clarified that it would be helpful.

A major part of the organisation's complaint involves the lack of focus on compliance enforcement in 2004–05. Overdue maintenance apparently more than doubled over the previous year, from £35.16 million to £88.9 million. That figure is rising, and it appears that little is being done to reverse the trend. However, during the same year only £8 million in arrears was collected by enforcement schemes. That gives the signal to those who do not want to pay that it is easy to buck the system and get away with it.

There were also problems with a lack of consistency. Even if people are lucky enough to have their telephone call answered—a recent press report suggested that more than 1 million calls to the CSA did not get through, so callers just gave up—staff are not accountable and often do not follow up on any actions promised. I have consistently noticed that in my role as a constituency MP.

David T.C. Davies (Monmouth) (Con): That is an important point. I cannot imagine that many people who have phoned the CSA have not had the experience of being unable to get through. I believe it is now giving out a special telephone number to MPs so that they can get access, but that does not help the great majority of
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the general public, who have as much constitutional right in this respect as we do. All I can do is echo everything the hon. Lady has just said.

Sandra Gidley : I think we have probably all met Fred Chase at some stage. He did a sterling job in trying to hold things together in respect of Members of Parliament.

One thing I have noticed about the CSA is that there is a reluctance to put anything in writing to a Member of Parliament. CSA staff would much rather talk and promise something, so that we do not have anything in writing to hold against them. That has changed a little recently, and I have been pressing for answers to my letters, but they rarely arrive within 28 days and frequently have to be chased up. The service to MPs is not good enough, and if an MP gets that kind of service, what chance does a member of the public have of getting good service?

If people manage to get hold of a member of staff, it is common for an action not to be followed up. In one press report, CSA staff came clean and said, "The pressure is so great that we sometimes just divert the call to the answer phone of a colleague who is on holiday, because we have then got it off our desk."

There seems to be an endemic problem that probably stems from management and leadership difficulties. Again, the culture of the CSA needs to be seriously addressed. When information is given to the CSA about the actions or financial status of non-resident parents, that is not acted on frequently enough and people simply give up.

Let me highlight how inefficient the UK system is. For every pound we spend on administration, £1.86 is collected. The equivalent agency in Australia collects more than £8 for every pound invested by the taxpayer. It is clear that a lot more can be done to make us perform better. Lots of solutions have been proposed, from scrapping the CSA completely to involving the Revenue in collection.

The computers, the management and so forth can be blamed—indeed, there is much to be blamed for—but it appears that no solutions are being offered. Sadly, many people are coming to the conclusion that the CSA is the biggest administrative disaster in the history of the welfare state.

2.50 pm

Mr. Peter Bone (Wellingborough) (Con): I congratulate the hon. Member for Romsey (Sandra Gidley) on securing the debate, which is of vast importance to all Members. I do not think that any party political points will be made today—the focus will be on genuine concerns. I believe that there would be more Members present if it were not for the fact that the debate on the Terrorism Bill clashes with this debate.

Before I was elected as a Member, I was not really aware of there being any problems with the CSA.—[Laughter.] As a new Member I can say that. This is one of those issues that does not affect the general public, but deeply affects the people involved. When a family is going through a break-up, the worst thing that can happen is added tension caused by the CSA.

I thought that the best thing that I could do today was to bring forward some cases that were brought to my weekly surgery last Friday. It is a somewhat random
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approach, but I had three relevant cases. I hope that the Minister will take on board the issues that these cases raise and try to address them in some way.

I shall start with case A, and will use the words of the lady concerned, because she puts it far better than I could. She says:

The payments that she receives have gone down from £218 per month to £167. Clearly, that issue needs to be addressed.

Case B highlights a different area. The lady concerned and her husband broke up on relatively good terms. They were obviously very concerned for the welfare of their children and set up a court order. Everything was working well; the lady was receiving the money and there was access to the child. Then the CSA overruled the court order, and as a result there are now huge arrears, which the lady appears to have no chance of recovering. On top of that, her income was reduced dramatically by the CSA becoming involved. Her complaint was that a whole year went by between when the court order was overruled by the CSA, and anything being done by the CSA. It was during that year that the arrears built up. She is very concerned about the efficiency of the CSA.

However, the most worrying example is case C. Hon. Members should bear in mind that these three people all came along last Friday—I did not select them. The hon. Member for Romsey mentioned that it was often the lady who does not receive the money to which she is entitled, and I know that that is a big issue. However, there are also issues on the other side.

The gentleman in case C split up with his wife and, between 1999 and 2003, he was making payments to the CSA, from an attachment to his earnings. There is no question about that—there is proof. He can show it from his wage slips, and the CSA has confirmed it. Lo and behold, one day, his mother, who is in her 70s, said, "I have got a bailiff at the door, demanding £8,979.61 for CSA arrears." Bear in mind that this gentleman had always made his payments to the CSA. He had had no notification through the courts; he had received no letters or anything else relating to the bailiff's visit. He does not live at the house where the bailiffs served the notice. He has moved in with another lady and they are intending to marry. They were nearly in tears: they may have to sell their house to repay some money that they do not owe. To get the bailiffs off their back, they had to make a payment of £5,000, and agree to a weekly payment of £100. That is outrageous, and is clearly due to the incompetence of the CSA. Although I picked that case at random, it is one of the worst cases that I have come across.

At every weekly surgery, I will encounter at least three CSA problems. For those people, the problem is desperate. I have had people crying in my surgeries because of the CSA's actions. I make no political points here and I am not sure of the solution.

The agency interferes in people's lives, seems to create a great deal of tension and does not provide the money correctly. I wonder whether it is one of those situations
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where the whole thing has gone too far and we might be better off scrapping it and going back to the previous system of letting the courts be involved. That would have been better for one of the constituents who came to see me. I am not saying that that is necessarily the right approach, but does the Minister think that we have reached that stage? I am sure that he will acknowledge that there are problems with the CSA. Does he think that root-and-branch reform is possible or has the CSA had its time?

2.56 pm

Mr. Mike Weir (Angus) (SNP): It is hard to overestimate the anguish that the Child Support Agency is causing throughout the country, both to parents with care and to absent parents. Worst of all, as has been hinted at, the very people whom it is failing most are the children whom it was supposed to help.

Every Member will have filing cabinets full of cases involving the CSA. We have heard from previous speakers details of some of their cases. Such cases are by far and away the largest component of my caseload, although complaints about tax credits are fast coming up on the outside.

It is important to note that the fault lies not with the staff of the agency, who are struggling under unbearable burdens and a caseload with which they simply cannot cope. I appreciate the comments made by the hon. Member for Monmouth (David T.C. Davies) about getting through to the agency, but when people from my office and I get through we have found the staff to be unfailingly helpful.

A sense of frustration comes through from the agency staff, however, about what they are having to put up with—for example, the fact that the computer system does not work. How often have Members sat at the end of a phone when someone has been trying to get information out of a computer, but has been unable to answer a question because they could not get the computer to work?

That is not helped by the fact that it appears that several different systems are running in tandem within the CSA: the old computer system; the new computer system; a manual payment system; and a hybrid mechanism between a computer and manual payment system. None of them seems to work efficiently.

A lady came to see me at a recent surgery in Brechin. She was being paid manually, but she had to phone every week to chase up the payment and to remind the agency to pay it into her bank account. That is not how the agency should operate and it is not acceptable.

The problems of the agency are legion and go back to    its foundation by the previous Conservative Government. I have dealt with the agency from both sides, because I was a solicitor prior to being elected to the House. I used to deal with child support cases prior to the agency. I remember that when it was being set up a meeting was held in my area. We were told by the officials of the fledgling agency that the legal system was too slow, that solicitors took far too long in dealing with cases and that the agency would speed up the process. It was painfully clear, even at that time, that it was woefully understaffed and underfunded, and that it would not be able to do that which was claimed.
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The agency seemed to think that everyone who was being asked for money would cheerfully fill in the forms and pay out whatever was assessed. It seemed to have no appreciation of the lengths to which some absent parents would go to avoid payment. Those of us who had dealt with this matter under the old system knew full well what was going to happen when the agency was set up. Indeed, when I inquired as to what it would do with people who did not return the form, it transpired that in the whole of Angus only one lady was to be charged with helping people fill out forms, going out on visits and chasing up unreturned forms. It was completely unrealistic from the outset.

The agency has never got over those initial problems. A good idea in principle was undermined from the outset by the rushed way in which it was introduced. Last year, I asked a series of questions about the agency because I was becoming increasingly concerned about cases that were coming to my constituency surgeries. I recognise what the hon. Member for Wellingborough (Mr. Bone) said, because my experience is the same. It is frustrating at surgeries when parents are in tears because they are unable to make progress and are at the end of their tether and depressed by their situation.

When I asked a question about arrears, I was told that in my constituency alone, which is mainly rural and not huge, there were 600 cases of arrears outstanding for more than three months and 26,000 in the whole of Scotland. That is appalling and is not helped by the fact that compliance often just does not take place. I was struck by what the hon. Member for Romsey (Sandra Gidley) said about the matter and I find exactly the same: that lack of effective compliance may continue for years. The information is given to the agency but no action seems to be taken. The person who has care of the child has to turn private detective to get together the information to give to the agency, and then finds that nothing seems to be done with that information. That is unacceptable.

The stop-start attitude of the agency when it starts compliance action is even worse. It starts an action against someone who promises to pay some money and then stops the compliance action. If no money is paid, the matter starts all over again. That is completely unacceptable. There seems to be no system within the agency to monitor compliance and to ensure that it continues.

I have one case in which the problem has been compounded by various appeals and assessments continuing for 10 years. A recent letter from the agency said that it is now reassessing all the assessments going back to 1994. Why should it take so long to deal with such cases? The parent concerned is at the end of her tether, and who can blame her?

The Scottish Affairs Committee, of which I was a member, looked into the operation of the agency in Scotland during the previous Parliament. We were assured then that the collection of arrears was a priority. Frankly, that could have fooled me, because nothing has changed in the intervening period. I am still seeing constituents who are chasing up huge arrears. Worse still, a constituent who recently came to see me had been chasing up the agency for more than two years to obtain
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substantial arrears from her ex-husband. She suddenly received a letter from the agency saying that it was sorry but it had made a mistake and no arrears were due. That, again, is completely unacceptable.

The situation is not that much better for absent parents. Not all try to avoid payment; many tell me that they are happy to make payments for their children and recognise their responsibility. However, having two different systems operating within the agency causes great concern, anguish and unfairness. Two people in exactly the same situation, doing the same job and receiving the same pay, may be paying vastly different amounts because of the date on which their assessment was made. That is also unacceptable. I see a steady stream of constituents with that complaint as, I am sure, do other hon. Members, but there is nothing that we can do about it.

I have written to the Minister responsible on numerous occasions and received the formulaic reply that it would be irresponsible to transfer old cases to the new system until the computer system is robust. Of course it would be, but why is the computer system not robust after all this time? Why is it taking so long to get the computer system sorted out? Why can the Government not get to grips with the problem, sort it out and introduce fairness into the system?

Even with the system as it is, the Minister, in a parliamentary answer to me last year, said that one fifth of cases under the new system contained errors. That is unacceptable of a computer system that cost many millions of pounds. It is important to note that even when cases are transferred, there will be a period of convergence. Many of those cases on the old system will never get down to the levels due under the new system because of the ages of the children and the length of time that payments have been made into the old system. Members should be aware of that when talking to constituents.

It may surprise the Minister, but I do not blame the Government entirely for the problems of the agency. I accept that they inherited the mess. However, they have had eight years, and the mess is getting no better. In many cases, it is getting worse, and urgent action is needed.

When the Government announced the new system, if we can still call it that, it was widely welcomed as providing some sort of fairness and a new way forward for the agency. However, the years of delay and foul-ups have wasted that chance, and deep cynicism has set in among those who use the services.

It is easy to be critical, but what is to be done about the agency? I do not support its abolition, because if we did that we would have to put something in its place. We cannot leave a vacuum for child support, but the agency needs severe surgery.

As I said at the outset, I was a solicitor prior to being elected to the House, and I dealt with many child support cases through the courts. That system worked to some extent, but given the length of time since the courts have dealt with such matters, I doubt whether they could cope with a sudden influx of cases that were no longer being dealt with by the agency. We must be realistic and consider how we can reform the agency.

The agency's staff are under huge pressure, and they are unable to cope with the demands put upon them. The Government must urgently reconsider their plans
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for cutting the number of civil servants in the Department for Work and Pensions and its agency. My experience is with the Falkirk centre, which deals with Scottish cases, but there is concern that staff are already under pressure because of understaffing, and if there are cuts to the agency, it will make matters only worse. I ask the Minister to reconsider the matter and to speak to his colleagues about the plans for the agency.

As a matter of urgency, all cases must be put on the new system to ensure fairness. I appreciate that that is not easy, but something must be done to cut the Gordian knot, otherwise the unfairness will continue for many years.

The hon. Member for Romsey talked about the new system and its simplicity, with maintenance being decided within six weeks. As a start, we must give the agency breathing space. A partial return to the old system by reintroducing ex parte applications for interim maintenance would take the immediate pressure off the agency and ensure that both parties were sure of their position, that there was an enforceable order in place quickly, and that some money changed hands pending a full investigation of the cases. It is not an ideal situation, but it is an interim arrangement.

I recognise what the hon. Members for Monmouth and for Romsey said about the reluctance of the agency to provide information in writing. I have instituted a system in my offices in which we note carefully everything that is said over the phone, but insist on a follow-up letter. All too often we have had the problem whereby we are told something over the phone, we tell the constituent and weeks later a letter comes saying something entirely different. That lack of consistency is unacceptable, and I urge all Members to insist on a written response. They should follow it up to ensure that the agency does what it says it will do.

3.9 pm

Annette Brooke (Mid-Dorset and North Poole) (LD): I, too, congratulate my hon. Friend the Member for Romsey (Sandra Gidley) on securing a debate on an issue that is of importance to every MP. I also have an enormous postbag on the subject and agree that the CSA is a shambolic institution. I have spoken at length on the subject and want to concentrate on one case: my constituent versus the CSA computer. I concur with all the other points that have been raised and have letters on those in my mailbag.

This particular case and some of the written communications to which it has given rise—I have some of them here—create the impression of a body that is completely out of touch with people and the state in which our constituents find themselves once they are in conflict with the CSA.

My constituent's relationship with the CSA dates back to 1997, but I will not start from then because it would involve a long catalogue of events. For the sake of brevity, I begin in March 2005, when my constituent, out of total frustration—I note how many times that word has been used in this short debate—with the system, asked for her case to be closed. She just could not cope with the stress arising from the catalogue of errors. Her frustration arose from the uncertainty of whether she would receive any payments, which affected her housing benefit and made her situation worse.
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At that stage, she was owed £600, and I understand that enforcement action is being taken. Hon. Members should note the language used in a letter to my constituent which arrived in May. It states:

So far, so good. It concludes:

I ask hon. Members to consider what it would be like to receive such a letter.

That is not the end of the story because, for really good reasons, my constituent decided to ask for her case to be reopened and initiated a new claim in June 2005. The CSA did not respond. She kept telephoning. She was told that her application had not been received and was not on the system. Eventually, she got a one-to-one meeting—that was quite good really—and she was promised money within a week.

The money did not come within a week. That took us to the end of August. I heard from my constituent on 30 August. Apparently, her ex-partner had paid £50 to the CSA in June, July and August 2005, but the CSA claimed that it was not possible to pass the money on to her given that her case with them was closed. That is quite a problem, involving a closed case and a newly opened case.

It is often said that the fault does not lie with the CSA, but with people not paying money to it. However, in this case, the CSA has the money. It is appalling that it is trapped in the system. The CSA has confirmed to me that it is owed to my constituent, but has said that there is a problem with the computer system. The case was passed to the live service support unit of the CSA and it has been given MP priority.

It is interesting to note that between the closure of the case and now, there have been no changes in the circumstances of my constituent's former partner. Therefore, all the necessary information was on the computer system. One would have thought that there was no need to use a manual system, but the enforcement action for the £600 meant that the newly opened case had to be dealt with manually. However, in my experience, there is no simple way of manually processing applications with the CSA, even though there is with most other organisations.

The MP priority system brought me a letter on 20 October—a high-speed response. It stated that there was a

that was preventing my constituent's case from being progressed. It continued:

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So that is my priority case as an MP. It started in June and it is now the end of October, but my constituent has not gotten a penny and the CSA has her money.

What is the impact on our constituents? Mine has to work really long hours to make up the money due to her, and the stress affects her physical and mental well-being. I am angry that the Government are party to a system that shows no understanding of how people on relatively low incomes live. For a mother bringing up two children, and working for a relatively low rate of pay, £150 is a great deal of money. It is the difference between the children having the right shoes for school and them wearing trainers, which are not acceptable to the school.

People on relatively low incomes budget week to week. It is unacceptable that they receive letters saying that a clerical team will deal with their problem in three months' time. Like the hon. Member for Angus (Mr. Weir), I feel sorry for the front-line staff who have to work under this dreadful system. Someone must be responsible for the chaos. Is it the people who were involved in drawing up the specifications for the computer system? Or is the problem down to some of the more general principles behind the Child Support Agency? We need something that relates to people, because we are all here to help them, but the system actually makes life worse for people who are already in difficult circumstances.

My constituent concludes:

The CSA in its current form is past praying for, and I look forward to the Minister offering us some hope for the future.

3.17 pm

Mr. David Laws (Yeovil) (LD): It is a pleasure to take part in this debate. I congratulate my hon. Friend the Member for Romsey (Sandra Gidley) on choosing the subject. I felt a great deal of sympathy with her on her early comments, not least when she said that her heart sinks when she learns of more Child Support Agency cases. I think that the same is true for those people using the CSA and I suspect her feeling is shared by most Members of Parliament. I am grateful to my hon. Friend the Member for Mid-Dorset and North Poole (Annette Brooke) for giving a shortened version of the trials and tribulations of just one of her constituents. Her case is typical of the way in which such problems run on for a significant time.

My hon. Friend the Member for Romsey made a comment that resonated with me. She said that in her view it was a miracle that we did not hear of more of these cases in our constituency advice centres. That occurred to me recently when I tried to come to terms with the subject as part of my new responsibilities. I looked at the performance figures for the CSA; they show the extent of the problem. The issue affects hundreds of thousands of people at least—the figure may even run into the millions across the country. Yet over the past couple of years I have not been hearing about the same numbers of CSA cases that I did two or three years ago. Sadly, they have been replaced by
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problems with the tax credit system. That has taken over as the No. 1 issue that I come across locally in advice centres.

After looking at the data on the CSA's performance and comparing it with the number of people that I see on the subject, my conclusion is that we do not see more of those cases in our advice centres and constituency surgeries because quite a lot of people have given up on the CSA. They do not believe that it works or that it can work. They do not believe that Members of Parliament can make any difference to its working. Some of the constituency cases that hon. Members have mentioned, and, indeed, MPs' own experiences of trying to get quick decisions, demonstrate that if we cannot unclog the problems with the CSA, goodness knows what it is like for millions of people who try to deal with the system. It is a big problem. The fact that, across the country, some of the momentum on the issue has dissipated as people have become more despairing is no reason for the House not to give the issue the priority it deserves.

Having recently taken over this brief from my hon. Friend the Member for Northavon (Steve Webb), I am aware of how many responsibilities the Department for Work and Pensions will have to deal with over the next few months and years. For instance, there is the massive issue of pensions and pension protection, associated problems with the tax credit system, and incapacity benefit and housing benefit reform. It would be tempting to spend a lot of time on those apparently new policy challenges and shrug our shoulders about the long-running problems of the Child Support Agency.

I hope that all hon. Members here today, including the Minister, will say that it is not good enough to accept that the system does not work, and that they will find out what the problems are and try to put them right. I welcome the Minister, my old colleague from the Treasury Select Committee. He has an analytical mind, and I hope that he will deal well with the somewhat poisoned chalice of responsibility for the CSA. I hope that his questions to those now running the agency will be demanding. I also hope that he will take advantage of having a new ministerial team and not be afraid of asking tough questions on policy issues that relate to the CSA, so that Ministers can decide whether the problem is merely administrative or whether we are asking the agency staff to do a job that is too complex.

The agency deals with a complexity of individual circumstances. Several hon. Members have recounted cases that demonstrate the complexity of people's lives. When I consider some of the constituency cases that I have had to deal with, I am not surprised that the agency's problems are fantastically complex. They often involve a change in circumstances several times a year.

Set against that are the problems referred to by a number of hon. Members, including the hon. Member for Angus (Mr. Weir). A large number of people are determined not to comply with the CSA's findings, and they take every possible measure to evade their responsibilities. We are asking the agency to do a tremendously difficult job.

Notwithstanding the difficulty of implementing the policy, it has had some significant administrative problems. As the hon. Member for Angus said, we must remember the context in which the debate is taking place. The CSA has had problems since it was formed in
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the early 1990s. They were identified soon after the Labour party came to power in 1997. Indeed, in the forward to the 1998 Green Paper, no less a person than the Prime Minister said:

He argued that the existing child support scheme was a "mess" and that it needed urgent reform.

The White Paper stated the problems of the CSA in similarly clear terms:

It continued:

That was exactly the aspiration that Baroness Thatcher expressed to the right hon. Member for Birkenhead (Mr. Field) when they bumped into each other at a dinner. The right hon. Gentleman referred to the meeting in one of his pamphlets on the subject. Baroness Thatcher's aspiration was to replace the existing and failing system with a better one, yet even now none of those aspirations has been met.

As the hon. Member for Wycombe (Mr. Goodman) knows all too well, the Select Committee on Work and Pensions Committee published a report before the general election. It concluded:

More worryingly, it goes on to say:

We heard those sentiments from hon. Members.

Therefore, in spite of all the attempts by the Government to reform the CSA during the past few years, and in spite of correct identification of some of the problems, there has been no progress. Most of the statistics that are available—there is an issue about the availability of statistics—indicate that the system is still in crisis. It is still getting worse or no better and is not improving.

The Select Committee came to a striking conclusion in paragraph 30 of its report, when it stated:

That is a significant conclusion for a cross-party Committee to reach. It shows the depth of concern about the agency and about whether it will ever work in its existing form, an issue with which the Government must deal.

To some extent, that significant and critical report gave the Government a period of grace to try to sort out the problems. A new chief executive is trying to grapple with them and a new ministerial team is considering them. Many of us have been distracted by the even greater problems, if it is possible to describe them as that, of the tax credits system and pension reform. We have been diverted from scrutinising the CSA in recent
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months, but it is again time to give it attention, to find out what the new chief executive has achieved and to hear the views of Ministers. I hope that the Minister will say what progress has been made and what the interim conclusions are about how the CSA should be developed.

I was interested in the comments of my hon. Friend the Member for Romsey about some of the CSA's administrative problems. She reminded us that it was initially set up to claw back money that was being spent on the benefits system to support families that were not receiving support from the non-resident parent. It was viewed by the Conservative Government who introduced it as a mechanism for securing the interests of taxpayers as much—if not more than—as a mechanism for securing the financial interests of children.

The figures that were cited by my hon. Friend indicate the extent to which the CSA is struggling to deliver on that most fundamental objective. This agency, even with all its problems, costs £326 million a year to run but was capable of collecting only £603 million in the latest year for which we have figures. One does not need much knowledge and understanding about the operation of the social security system to know that a cost-to-collection ratio of 1:1.85 is appalling. It compares badly, as I believe my hon. Friend said, with countries such as Australia, which has a far more plausible cost-to-collection ratio of 1:8.

From the sum collected, the CSA made payments of £472 million to parents with care and transferred £119 million to the Department as a benefit offset. Does the Minister have figures to show whether the CSA is saving any money for the Government, compared with what would have been the case had the previous arrangements continued? It seems that the administration costs are immensely high and the savings on the benefits bill are very low because of the ineffectiveness of the system.

My hon. Friend also referred to the associated issue of staffing. It is quite a criticism of the agency that its administration costs are massive for the amount that it collects, yet there are questions as to whether it has the necessary people to do the jobs that it is asked to do. It is clear that the staff are struggling. I concur with hon. Members who expressed their sympathy for them. The turnover of staff and sickness rates show the pressures that they operate under, the price of which is paid by people who rely on the system. What is the latest situation with regard to staffing at the CSA? To what extent can the Minister continue to protect those staff from the reduction of the work force in his Department and its associated agencies by 30,000 people in the next few years? The agency will struggle if the Government do not maintain the protection of those staff until the problem is sorted out.

My hon. Friend the Member for Mid-Dorset and North Poole spoke about the difficulties that she and some of her constituents are having with the administration of the CSA. There is real concern about the continued IT failures, on which I hope the Minister can update us, the fact that so many cases currently have to be clerically processed, and the growing backlog of cases. The Minister's most recent parliamentary answer to me on the matter and the latest information from the
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chief executive show that overall agency compliance rates in the latest quarter were lower than for any quarter in the previous five years.

My hon. Friend's concerns about administration are shared by other Members, who have not given up all hope of solving their constituents' cases. I was contacted recently by someone who is a caseworker for my hon. Friend the Member for Harrogate and Knaresborough (Mr. Willis) who told me that his office recently had a large number of CSA cases coming through. In a note, the caseworker said:

All the administrative problems that there were six months, or even six years, ago, are still there, instead of reducing as the new CSA system comes in. I hope that the Minister will pick up that point.

I shall be cautious in my general comments on the CSA as I have only just inherited this portfolio and set of responsibilities and do not have as much experience of it as other hon. Members, such as the hon. Member for Wycombe, who served on the Select Committee. There is huge tension in the CSA on issues of fairness and complexity. Many complaints about the CSA, certainly in many of the cases that I have seen in my advice centre over the years, involve people who feel that individual maintenance settlements are unfair to them and do not take their circumstances into account. My party's previous position was to say that we shared those concerns and that we wanted to return to the old magistrates court system, in which all circumstances could be taken into account and every special element of a family's circumstances could be considered, but our policy has rightly moved on from that. The complexity of the system and of the cases being dealt with is so great that any agency operating the system would be challenged. The right hon. Member for Birkenhead was right to suggest that we need a more straightforward, simple system and that we need to set maintenance contributions at a level at which we can expect people to contribute.

However, if there is to be fundamental reform of the CSA, the Government must consider, as the right hon. Gentleman also said, whether the agency sits in the right place. It is bizarre that tax credits are handled not by the Department that has expertise in paying money to people on low incomes—the Department for Work and Pensions— but by the Inland Revenue. It is also bizarre that the Department that has competence in collecting revenue and that has information about other individuals who are not compliant—who may be self-employed and who may in some cases try to evade their CSA responsibilities—is not the agency with responsibility for the CSA. One of the biggest issues for the Minister to tackle is not whether the administration is working, and how to resolve that, but whether the existing CSA system is workable or should be transferred to Her Majesty's Revenue and Customs. Perhaps that is the necessary solution.
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3.35 pm

Mr. Paul Goodman (Wycombe) (Con): I must take my attention from the interesting and thoughtful speech that the hon. Member for Yeovil (Mr. Laws) has just made and congratulate the hon. Member for Romsey (Sandra Gidley) on securing the debate. She set the tone at the start when she said that she and her constituents feel—as, she feels sure, do CSA staff—a deep and prolonged sense of frustration. The hon. Member for Mid-Dorset and North Poole (Annette Brooke) also mentioned frustration. We all share that frustration and the debate has been a good one. Everyone who spoke, including my hon. Friend the Member for Wellingborough (Mr. Bone), set out the frustrations clearly.

We all get the sense from our constituents who see us in surgeries that they consider us powerless, at times, to make the system work satisfactorily for them. That view was also taken in the previous Parliament by a forceful and perceptive Back Bencher, who asked the then Minister about the matter and said on receiving the answer that it was

He pointed this out:

He added:

That was, of course, this Minister. He now has responsibility for the system of which he was rightly so critical in the previous Parliament. I do not think that we expect instant answers from him today, and we acknowledge that the problems are deep seated, but I hope he will explain the Department's route map for getting us out of here to a more satisfactory situation.

The hon. Member for Yeovil quoted the Select Committee report, and the former Secretary of State, who is now Secretary of State for Trade and Industry, raised in his response to it last year the so-called nuclear option of sacking EDS, the computer supplier. He said that that had not been ruled out. Last week, in response to a debate initiated by my hon. Friend the Member for Chesham and Amersham (Mrs. Gillan), the Minister confirmed that the new chief executive of the CSA would report his findings to the ministerial team. When does the Minister expect those findings to be on his desk and to be published for Parliament? What position has been reached as to the nuclear option of sacking EDS? Has it been ruled out? As he asked his predecessor so forcefully, when will the transfer from the old system to the new take place?

I have given the Minister prior notice of another matter that I want to raise—the Department's policy in relation to the CSA and paternity testing contracts, with specific reference to a firm called DNA Bioscience and the role of the Secretary of State. The Secretary of State has today written to my hon. Friend the Member for Epsom and Ewell (Chris Grayling), the shadow Leader of the House, about the matter. The Secretary of State
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confirmed that his sons have a 3 per cent. shareholding in DNA Bioscience, a firm whose business involves DNA testing. He added:

It would seem to be a significant shareholding.

The Department has separately confirmed that DNA Bioscience has had discussions with the CSA and has not denied that those were about possible contracts. In the letter, the Secretary of State does not deny discussing, since his appointment, DNA Bioscience and possible CSA contracts with a gentleman called Tariq Siddiqi, a businessman whose family members own DNA Bioscience.

The ministerial code of conduct sets out clear guidelines on Ministers' private interests. Paragraph 5.11 says:

—I shall stress "apparent" for the moment—

The code continues:

I have a few questions for the Minister about the contracts. If he cannot answer them all today because of time constraints, I would be grateful if he confirmed that either he or the Secretary of State will answer them in writing.

Secondly, precisely what appropriate action will the Secretary of State and the Department take—they refer to "appropriate action" in the letter—in the event of

Thirdly, the Secretary of State writes that he is satisfied that he has

Given that the Secretary of State purchased a significant stakeholding for his family members in a firm that appears to be bidding for contracts with the CSA, are the Department and the Government satisfied that no apparent or actual conflict of interest exists? If they are, do they seriously maintain that the purchase of that stakeholding is not a breach of the spirit of the code? It is at least arguable—I shall put it no more strongly than that—that it is.

Finally, paragraph 5.2 of the code says:

Has either the Secretary of State or the Department referred the matter to the Prime Minister for a view? If so, what view has the Prime Minister taken? In the light of the fact that it is possible that DNA Bioscience has been applying for contracts with the CSA, and in the light of the fact that the Secretary of State has written to my hon. Friend the shadow Leader of the House, I felt compelled to raise those questions this afternoon. I shall now allow the Minister to respond.
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3.43 pm

The Parliamentary Under-Secretary of State for Work and Pensions (Mr. James Plaskitt) : Everyone who contributed to the debate had the same motivation to do so: as constituency MPs—I include myself in this—we have all wrestled with difficult constituency cases over the years. Constituents have become embroiled in the CSA, and the agency has let them down in one way or another. Hon. Members have spoken of distress, tears and anguish, and we have probably all seen those things in our surgeries. That is why many of us have long-held concerns about the state of the agency and want to see the problems addressed.

I felt that we were having a constructive discussion. Hon. Members have brought their genuine experiences to the table and, quite rightly, they want me to answer questions about the agency. They are concerned about the parents who are enmeshed in these matters. More essentially, they are concerned about the children.

We were having a debate of that type until we reached the previous contribution, which unfortunately indulged in raising other issues. That suggests that the hon. Member for Wycombe (Mr. Goodman) is perhaps not as interested in the agency as he is in other matters.

Turning to the meat of the debate, I begin by congratulating the hon. Member for Romsey (Sandra Gidley) on securing this opportunity and on giving several Members another opportunity to express their views on the issue and to put perfectly reasonable questions and challenges to the Government regarding what we will do to address the agency's problems. I shall not conceal for one moment the scale of the issues that we were wrestling with at the CSA; it is clear that I am not talking about a success story, and there is no point pretending that I am doing anything other.

However, it is important to keep a certain perspective on what is going on at the agency. In our surgeries, we all—me included—come across the cases that have gone wrong in one way or another. Almost by definition, we do not come across the cases that are working. Before rushing to judgment, therefore, we need to be a little careful to determine whether the thing has completely failed and whether we have the whole picture in front of us.

We must bear it in mind that since the agency was established, it has collected £4.5 billion of child maintenance payments and that 527,000 children are being supported by maintenance payments because of the CSA. We do not hear about the cases that get processed and set up in six weeks, although I assure hon. Members that there are some.

Nor are we paying attention to the quite sharp recent increase in action by the agency to chase non-compliant non-resident parents. Let me share with hon. Members the figures on the issuing of liability orders, which is the necessary preliminary step to taking action to recover debts and non-payments. In 2002–03, the agency issued 2,383 such orders; in 2003–04, it issued 3,885; and in just the first six months of the current financial year, it issued 4,539. The impression that is sometimes created is that the agency is falling down on the job and doing nothing to chase non-compliant non-resident parents, but that does not quite match the entirety of the picture.
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We all know, however, that alongside those elements of the agency that work—I am pleading for perspective here—there are far too many elements that do not. I shall not pretend for one moment that the agency's performance is in any way acceptable; it has let far too many people down and the issues need to be addressed. The hon. Member for Wycombe is perfectly right to quote back at me things that I said in the House of Commons as a constituency MP. I said that these issues had to be tackled and I consider myself quite fortunate because I am now in a position, perhaps, to ensure that we do something about them. Indeed, we are doing something about them.

The new chief executive went in nearly six months ago, and he and his team are doing a root-and-branch analysis of the agency, with nothing being left unexamined. The hon. Member for Yeovil (Mr. Laws) wants to know whether my ministerial colleagues and I are asking all the tough questions to get to the bottom of the agency's problems. I am happy to reassure him that that is exactly what we are doing. The questions are very tough, and the task that the chief executive has been given is extremely challenging.

Mr. Laws : Will the Minister give way?

Mr. Plaskitt : I have limited time and I have yet to turn to many of the pertinent questions that hon. Members asked, so if the hon. Gentleman will forgive me, I shall not let him intervene at the moment. I should reassure him, however, that we are carrying out the deepest analysis that anyone has ever done of the agency and its issues. We are looking at every single aspect of how it works. All the tough questions are being asked, including whether the situation is recoverable. Of course, we had to ask that question before deciding what route to take.

In just one sense, this debate is slightly premature: as hon. Members know, although the exercise I have described is under way, it has not been concluded. However, that is not far off and we have undertaken to come back to Parliament before the end of the year to present our views on what can be done to assist the agency towards recovery and in overcoming its problems. That work is very much in hand and is coming to a conclusion. It will not be long before we are in a position to present our proposals to Members of Parliament. I am aware, as I think we all are, that we have about 650 experts on the CSA in the House of Commons, so I look forward to putting our proposals to hon. Members in due course.

To turn to the specific issues raised by the hon. Member for Romsey, I first want to say that she and other hon. Members should be congratulated on their assiduous efforts on behalf of their constituents. She is right: many of our constituents find themselves in acute difficulties in handling the agency. They come to their local MP in an effort to seek remedy and we take their cases on. I know how assiduous the hon. Lady is in dealing with those cases, because I see the correspondence and sign it off. Her constituents are well served by an MP who takes on cases with as much earnestness as she does.

I understand exactly when the hon. Lady talks of her constituents' deep frustration, the inconsistency and the delays. Those are common to the tough cases that we all
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deal with as constituency MPs. She is right to draw our attention to the Select Committee report, which is helpful. The Committee's analysis is welcome. I have studied all the recommendations and I think I can say without giving too much away that pretty well all the issues and proposals that came out of the report have been considered in one way or another within the analysis that the chief executive, his colleagues and we Ministers are now undertaking. No stone has been left unturned and no issue overlooked, including those raised, quite rightly, by the Select Committee.

I am pleased that the hon. Lady mentioned the agency staff, as did several other hon. Members. I am acutely aware that the staff are often as let down by the system problems as the clients. I can assure hon. Members that the staff share the frustration of many of the agency's clients. In the end, they are trying to make a system work. I have described them sometimes as being asked to work with one hand tied behind their back. They are dealing with an overcomplicated system and IT that lets them down. All those problems have to be solved, and progress will be as much welcomed by the staff who struggle with the system as by those of us and our constituents who are caught up in it.

Several hon. Members asked about staffing levels. We have undertaken that there will be no reduction in front-line staff working in the agency until we are absolutely sure that the system is robust and working. I can give that reassurance to all hon. Members who raised that point.

The hon. Member for Romsey talked of the delay in introducing the new formula and the hon. Member for Wycombe referred back to my comments made in the House during the last Parliament about the advent of two systems running in parallel, which is pretty much what we have. Hon. Members may know that I was involved with the then Minister in devising the new formula. Like hon. Members in this Chamber this afternoon, I had stood up in the House and railed against the inadequacies of the old system, so I got myself involved in devising the new formula.

I am just as frustrated as other hon. Members by the fact that although we worked hard to devise a simpler formula that is fairer and that will bring more justice to the system, as of today, there is no complete conversion of existing cases, despite deadlines that have been passed and overlooked many times. About 500,000 cases are on the new formula, but they are the new cases that came in after the 2003 launch.

One of the big challenges faced by the agency is completing the migration of the old cases to the new formula and then doing the conversion to it. That is the centre of the efforts that we, together with the chief executive, are making to figure out how we will do that and on what time scale. It is in our minds because it is a pressing need that we have to address. Due to the time constraints, I must move on to the other contributions. I know that the hon. Member for Romsey raised some issues that I have not covered, but I am happy to write to her about those that I have unfortunately been forced to omit.

The hon. Member for Wellingborough (Mr. Bone) raised an interesting case from his surgery last Friday about a bailiff intervention. I am slightly puzzled by it. The agency should not have got to bailiff intervention
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unless a liability order was in place. That is a necessary precondition. Furthermore, I believe I am right in saying that there would have to have been non-compliance on the part of the non-resident parent for the bailiff action to be triggered. If I have said anything that he thinks is not correct in relation to that case, and if he wants to write to me, I will be happy to pursue the matter further.

The hon. Gentleman also suggested that the agency interferes in people's lives. That phrase is interesting. The agency does not seek to do that, and nor do the Government. The agency's involvement arises because of a failure after the break-up of a relationship to make provision for the children. People can do that by private arrangement, and many do. As the previous Government found when they decided to set up the agency, children were being let down, but they must be supported. That is what drives this whole process. The court system was not doing it, hence the birth of this agency. The agency has a history of problems—we know that—but we are trying to sort them out.

The hon. Gentleman asked finally whether we have reached the stage of scrapping the agency or sorting it out. We are trying to sort it out. That is the bottom-line answer. If hon. Members are considering the option of scrapping it, what should replace it? We cannot leave a vacuum in which children are unsupported and the maintenance is not flowing. That would simply not be acceptable.

I am grateful to the hon. Member for Angus (Mr.   Weir) for his measured and constructive contribution. He, too, referred to the two systems running in tandem—that situation is not acceptable—and also mentioned staffing. I have tried to cover the other points in answers to earlier contributions, but I agree with him that parents will go to extraordinary lengths not to comply. That presents a host of challenges to the agency.
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The hon. Member for Mid-Dorset and North Poole (Annette Brooke) referred to confusing letters. There is no justification for those: I, too, have seen some of them, and I have sat and reread them two or three times. We need to deal with that issue when we try to sort out the agency and how it deals with its customers. She concluded by asking who is to blame. We could play the blame game for quite a long time, but it is less constructive than trying to find long-term solutions. What will stabilise the agency? What will get it back on track? What will improve its performance? What will enable it to endure and to do the job it was set up to do in the first place? That is where our focus is now. Those are the analytical questions we are asking and we are close to getting answers. I hope that she, too, is looking forward to hearing our conclusions, which we hope to announce before the end of the year.

The hon. Member for Yeovil asked whether we are shrugging our shoulders over the CSA. No, certainly not. As I have suggested, we are working hard on trying to solve the problems. He wants to transfer the agency to the Revenue—his latest wheeze—but I am far from sure that it is right. Taking his points about complexity, he will see that the transfer of ownership of the agency would not of itself deal with the deep problems that arise when one is dealing with these complex cases. A simple transfer of where it lives within the Whitehall network would not address the core issues that have given rise to the agency's current problems.

I am grateful to all hon. Members for the specific points they have raised, and I will respond by letter to any issues that I have overlooked. We fully take on board the extent and the scale of the problems with the agency. We do not minimise them in any way, and now is not the time to gloss or paper over them. That is not what we are doing. The deepest analysis is taking place, and has been since the new chief executive went in. We are examining every issue and every option. We look forward to coming back to Parliament before long with proposals on how we can stabilise and rescue the agency, and bring it to a position in which it does the job it was set up to do.
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