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Mr. Laws: That sanction has been used on a very few occasionsthey can be counted on the fingers of one handin recent years, so it has been totally ineffective in dealing with the 1.4 million cases that the CSA is handling. The hon. Gentleman will be aware that even Ministers have lost confidence in that measure. Journalists who had been briefed by the Department about the tagging proposals said that Ministers were selling those proposals on the basis that the removal of driving licences was potty because it stopped people working and therefore earning money to pay the maintenance that they owed. That highlights the problems with the Government's policy.
Before we consider some solutions, we should reflect on the manifest problems in the agency, of which there is no better summary than its obvious failure to collect money and its relation to its administration costs. At present, as the Prime Minister acknowledged in November, for every £1 in administration costs, the CSA collects only £1.85 from absent parents, and the figure has fallen over the past five years. That compares with a ratio of 1:8.5 in Australia; in other words, the Australian system is more than four times as effective as our own[Interruption.] If the hon. Member for Rhondda (Chris Bryant) wants to indicate that the CSA's position is even worse than it is, I shall be happy to take an intervention. Ministers owe it to us to let us know whether they are aware of any child support system in the world that is less effective than ours in collecting money from absent parents. I am certainly not aware of one.
A second measure of how bad the CSA is at collecting the money due to it is the position on arrears. Ministers have told us on numerous occasions that arrears would be stabilised or that arrears would be paid down. When the Government came to power in 1997, the arrears owed by absent parents were £1.1 billion, but that figure has tripled to £3.3 billion, so it is no surprise that the agency's client fund accounts have been qualified by the National Audit Office in every year since the CSA began.
Mr. Russell Brown (Dumfries and Galloway) (Lab):
The hon. Gentleman suggested that we could probably count on one hand the number of occasions when the
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power to remove driving licences had been used. Although that may be the case, does he have any indication of the number of cases where something has come about after nothing more than the threat of the removal of a licence? In other words, people threatened with the removal of their licence soon pay up, and the vast majority are self-employed.
Mr. Laws: There are figures showing how many people have been threatened with that sanction and my recollection is that the number is in the 10s or 20s; it is certainly not huge. As I am sure the hon. Gentleman realises from his constituency, the fundamental problem with the CSA is not the absence of enforcement mechanisms, but the inability to make assessments quickly and accurately and then to collect the money efficiently.
Mr. Laws: I shall give way in a moment, but I want to make a further point about one of the major problems with which the CSA is strugglingthe backlog that has built up over a long period due to the ineffectiveness of the mechanism for considering assessments. Despite the move to the new system of child support maintenance a few years ago, the agency has a backlog of 333,000 casesa third of a millionand of those 73,000 are more than two and a half years old. That is wholly unacceptable, as is the fact that a third of the new scheme cases that have not yet been processed have experienced waiting times of 448 days. When we consider that when the new scheme was introduced the Government were talking about waiting times of six weeksyet it is now six monthswe realise what an enormous problem the CSA is experiencing.
Mr. Mark Francois (Rayleigh) (Con): I am no defender of the CSA, but the hon. Gentleman's proposed solution is to give the problem to Her Majesty's Revenue and Customs, despite the fact that it experienced a fiasco in its own right in the maladministration of tax creditsa problem that continues ad nauseam. Given that the hon. Gentleman, like me, has often been critical of HMRC and the Treasury because of that maladministration, how can it make sense to give HMRC this problem when it cannot even deal with its own fiasco?
Mr. Laws: Precisely because it was absurd in the first place to put, for entirely political reasons, means-tested benefits into the tax Department, which is used to collecting money, when in fact the CSA, which is about raising money, should be part of the Inland Revenue. The two are in the wrong position. To think of that simply as a managerial problem is totally to misunderstand the problems with both tax credits and the CSA.
Tim Farron (Westmorland and Lonsdale) (LD):
I thank my hon. Friend for bringing to the House's attention this very important issue. He rightly talks about the amount of money that the CSA fails to recoup from absent fathers, but I am sure that he is also aware that much of the money that the CSA recoups is wrongly recouped. For example, one of my constituentsan
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ex-husbanddutifully made his maintenance payments, but found that they were going to the wrong person because the CSA had the wrong national insurance number. Having cleared up that matter for him, the same thing happened again three months later. So even if one in five absent fathers is paying, many of them are paying the wrong person.
Lembit Öpik (Montgomeryshire) (LD): Does my hon. Friend nevertheless agree that many of the CSA's staff are doing their best to work in a terribly flawed system and that their position is being made even more difficult by the Government's attempt to remove key workers who can go out and meet individuals on a one-to-one basis, thus making it even more difficult for those who are charged and those who are paid to correct mistakesa problem that is particularly acute in Wales?
Mr. Laws: Not only do I agree with my hon. Friend, but he brings me precisely to the next issue that I want to raise with the Minister: the CSA's work force. At an agency with the appalling record of mismanagement and underperformance that the CSA has had since 1993, we would expect the Government either not to cut staff numbers or to increase them. Indeed, when the Select Committee on Work and Pensions reported in January 2005, it said:
"Cutting the work force of the Child Support Agency at this critical time is the major concern of the Committee. It's a massive breach of trust for the thousands of staff who've worked hard to improve the service. It makes no sense to implement job cuts when the Agency is already struggling."
"The Secretary of State. . . announced on 26 January that there would be no further reductions in front line staffing until the new computer system is working effectively. . . The Agency is now recruiting staff to meet current and anticipated needs."
When we look at the statistics, we discover that in March 2004 the CSA had about 10,800 staff, and that by the time the Government's response to the report came out, the number had fallen by about 1,000 to 9,784. We now discover that the figure will be even lower this Marchdown to 9,400and the Minister owes us an explanation as to why it has been right to cut staff numbers by one in eight at an agency that is failing some of the poorest people in the Britain and why it appears from those figures that, frankly, the Government have gone back on the clear undertakings that they made to the House about the CSA's staffing.
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Sir Robert Smith (West Aberdeenshire and Kincardine) (LD): As my hon. Friend has said, the Government's reply talks about a time when the IT system is working. It is clear from recent casework that the IT system is still failing badly. Many cases are being transferred on to a manual handling system, because the IT system cannot be repaired to deal with individuals' casework. Clearly, that will put even greater burdens on the staff and create even more problems for our constituents.
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