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We will remove the obligation on all cases; the hon. Gentleman asked about that, and we certainly intend to do that. The maintenance disregard will of course apply only in relation to benefit cases—obviously, it will not apply to other cases. The hon. Gentleman also asked about the assessment process. I think that there is broad support for that; Sir David Henshaw certainly
found broad support for the reforms introduced in the 2000 Act, and we do not intend to revisit the issue.
The hon. Gentleman asked four specific questions. He asked about the estimate of long-term operating costs. Sir David has estimated that the changes to the administration of child support will probably save us 50 per cent. of the current operating costs of the agency. Of course, there will be other costs associated with making the changes, but they will depend on the detail of the proposals that we bring forward in the White Paper in the autumn.
On migration, Sir David recognised that more work will need to be done on that. I felt that it was important that Members could see the outlines of the new system as soon as possible; that is why I asked Sir David to bring his initial recommendations forward as quickly as possible. He himself recognised that a significant amount of work still needs to be done in that regard. It will be done as a matter of urgency, and I will take it as my responsibility to ensure that Members in all parts of the House have full sight of, and full involvement in, the development of that important work.
The hon. Gentleman asked whether I can give further details today on the maintenance disregard. All that I can say to him and to Members in all parts of the House is that it will not be 100 per cent., because such a figure would send the wrong signal about the balance of responsibilities between parents and taxpayers. Some interesting American evidence shows that, if one focuses more on dealing with child poverty as the principal objective in child support systems, there is, in particular, no discernible impact on incentives to work. That is a very important lesson that we need to reflect on. The hon. Gentleman also asked who is going to run the new arrangements and with the greatest of respect to him, it is just a little too early to name any names in that regard.
Mr. Terry Rooney (Bradford, North) (Lab): May I congratulate the Secretary of State on today’s statement? This has been a sorry 15 years of the CSA’s history that we have had to bear. Does he agree that the two principal factors that we need to consider are parental responsibility for maintaining their own children and attacking the child poverty target? Does he further agree that the full compliance of parents would have a significant impact on the child poverty figure?
Mr. Hutton: I agree strongly with what my hon. Friend has said. He and the other Members of the Work and Pensions Select Committee made it very clear in their most recent report on the CSA that it really was time for the Government to consider setting up a new organisation that could pursue the very important objectives set out in it. I can confirm to him and to the House that those will be the principal objectives of the new system, and I am confident that, in the light of the arrangements that I have set out today, we can make those responsibilities stick.
Mr. David Laws (Yeovil) (LD):
May I thank the Secretary of State for his typical courtesy in making available a copy of the statement and of the documents
so far in advance of today’s oral statement? May I also congratulate Sir David Henshaw and his team on completing this work in such a short time? Does not the speed of Sir David’s work contrast with the Government’s own tardiness in dealing with this issue since 1997 and, indeed, since the 2005 general election? I remind the Secretary of State that since that election, we have had a review of the CSA’s future, followed by a redesign of the policy on the CSA. We are now being offered today a consultation on the CSA’s future, to be followed by a White Paper on the CSA’s future. If the Secretary of State’s own document is to be believed, that will followed merely by
“an ambition...to see some aspects of the new system in place from 2008”.
In other words, what he is offering us today is that, 11 years after his Government came to power,
“some aspects of the new system”
will be in place. Does he think that that is really good enough, and does he acknowledge that his Government have wasted 10 years in dealing with this issue?
Is that point not also reinforced by what Sir David says at the beginning of his own document? He says that he had a very demanding timetable that was
“not sufficient to allow for a full redesign”,
but which allowed him to indicate only “the direction” of his new policy.
The Secretary of State said today that the CSA is going to be scrapped, which is what we have heard according to all the spin outside this place. He had previously said that he would not scrap it until he was clear what it was going to be replaced with. What is it going to be replaced with? Is it not astonishing that all that he can say today, in paragraph 55 of his own document, about the CSA’s future replacement is that there are a range of approaches that could be taken to the structure of the governance of such an organisation, and that an intensive programme of work will be undertaken, including full consultation with staff, to figure out a way forward? Is it really acceptable that, after 11 years in power—that is how long this Government will have been in power when these measures will, so the Secretary of State says, be implemented—he still does not know what he intends to replace the CSA with?
Is the agency going to remain under the DWP? Is it still going to be run by the existing chief executive, and is it going to be based at the existing locations? If so, is this not going to end up being a re-badging, rather than a fundamental replacement of the existing agency? The Secretary of State indicated that he intends to reinforce enforcement powers. Why has he proposed to introduce curfews for non-resident parents who are not adhering to their child support obligations when that proposal was not made by Sir David Henshaw? Will he tell us how effective that is likely to be? Is it likely to be as ineffective as previous Government gimmicks, such as withdrawing driving licences? That measure was used only 11 times in four and a half years.
We welcome the new emphasis on people making their own arrangements and the higher disregard that Sir David recommended and that the Secretary of State has undertaken to consider, but will he assure us that he will not use a charging mechanism for resident parents who have to use the agency and have had to
deal with an incompetent service over the previous 13 years of the agency’s life, and who would be astonished to have to pay for the use of this incompetent agency in the future? Have the Government gone far enough in giving the new CSA access to the sort of income details that it would be able to get if it were part of Her Majesty’s Revenue and Customs, and the ability to deduct money directly at source?
Today’s statement, which was made almost 10 years after the Labour party came to power, contained a set of proposals that seem to amount to no more than re-badging with additional lengthy delay and more gimmicks. Should we not have expected more after 10 years?
Mr. Hutton: I say to the hon. Gentleman what I said to the hon. Member for Runnymede and Weybridge (Mr. Hammond): this is not a re-badging exercise, but a fundamental change to every aspect—root and branch—of the child support system. The hon. Member for Yeovil (Mr. Laws) did not have the courage of his previous convictions and did not repeat his support for the transfer of responsibilities to HMRC. As he will know, that was considered on page 50 of Sir David Henshaw’s report and rejected for perfectly sensible reasons. He and his hon. Friends could usefully go away and study that. We cannot solve the problem of the administration by simply relocating it to a different part of Government. That is not the right way to deal with the problems of the CSA, because those problems are not just organisational or administrative. They are much more fundamental than that. That is why Sir David has come to his view that transferring the CSA to HMRC, which I understand is the hon. Gentleman’s policy, would not be right. We have no intention whatsoever of taking that course.
The hon. Gentleman berated the Government for taking 11 years to come to this decision. We tried very hard. We have tried repeatedly in recent years to make the arrangements that we inherited work. We have revisited the legislation and invested heavily in support and IT systems for the CSA. It does not work. We should have the courage to say that it is time to turn over a new leaf. That is what I am trying to do. He might catch up with us at some point, but I am afraid that he is significantly behind the curve today.
Most of the changes will require primary legislation. That is why we cannot announce the detail of all of them today. We cannot implement them until both Houses of Parliament have agreed that there should be changes to the primary legislation. That is called the democratic process and the hon. Gentleman will have to take part in that, as everyone else will, and I am sure that we will hear his views in due course.
I have made it clear that the operational details in relation to the structure of the new organisation will be set out in the White Paper. In relation to the enforcement powers, Sir David Henshaw suggested that we take on board the idea of a passport disqualification power and we will certainly do that. He has also made it clear in the report—the hon. Gentleman should study it—that he wants us to consider what further measures might add to the enforcement powers of the Child Support Agency. It is important that we have the powers. They will not
necessarily always be used, but they will be a deterrent. That is the point and that is the way in which we should judge the success of all these issues. I want the CSA, now and in the future, to come down like a ton of bricks on absent fathers—it is usually absent fathers, but let us say absent parents—who are not discharging their legal and moral duties to support their children.
We will look for support from both sides of the House to strengthen the enforcement powers of the Child Support Agency, and I am sure that I will have it from my hon. Friends. When it comes to making some of the hard decisions, these guys—the Liberal Democrats—are never to be found anywhere on the premises. Given that, the hon. Gentleman’s response is entirely predictable.
Mr. Speaker: Order. I remind the House that I expect only one supplementary from Back Benchers.
Mrs. Joan Humble (Blackpool, North and Fleetwood) (Lab): I welcome today’s statement and the recognition that too many children are being let down by the agency. Will the Secretary of State expand on his comments about the role of Child Support Agency staff? They are working very hard to implement both the old formula and the new formula, but they will now be dealing with phone calls about his statement and coping with uncertainty about their future in whatever the new structure will be.
Mr. Hutton: I agree entirely with my hon. Friend. Those are major issues for the CSA and its staff to deal with. The Department will be providing all the support that it possibly can to help CSA staff to cope with the changes. She is right that there is likely to be immediate pressure on the staff. It is our responsibility to ensure that we provide every support that we can to them and we will certainly do that. We will consult closely with the trade unions of the CSA and work closely with CSA management and Stephen Geraghty, its excellent chief executive, to make sure that the reforms work in the way in which we intend. There will be full and proper consultation with all stakeholders, including the CSA staff themselves. Incidentally, the staff are doing a brilliant job for all of us, so it is our responsibility to support them to the fullest possible extent.
Mr. Eric Pickles (Brentwood and Ongar) (Con): The Secretary of State said that he wants to come down like a ton of bricks on parents who do not contribute, but does he understand that the important thing is to get the infrastructure in place so that offices can talk to offices, e-mails can be answered, telephone calls can be returned and thousands of files do not just disappear as clerical files? He will recall that I wrote to him recently about a case, on which he kindly intervened. The senior resolution caseworkers have been involved, as has the hotline, but the case is stuck in Preston in a file that no one can see. Does the suggestion that there will be no automatic conversion of cases mean that my constituent will have to start again? She and her family have been deserted by a deadbeat father. How can I explain to her that the Government have now deserted her?
Mr. Hutton: I will take further interest in the case that the hon. Gentleman cited, but I hope that he will make it clear that we are not deserting families. It is necessary to replace the CSA with a new organisation for reasons that are pretty widely accepted across the House, despite the comments of the hon. Member for Runnymede and Weybridge. In the intervening period, it is important that we do all that we can to support people, such as the constituent of the hon. Member for Brentwood and Ongar (Mr. Pickles), who are not getting the support to which they are entitled from the CSA.
By the way, we are investing another £120 million over the next three years in trying to deal with this and other related ongoing problems of the CSA. We are in no way walking away from the problems in the CSA that are there for us all to see. If the hon. Gentleman wants to confirm the details of the case to me again, I will certainly take a personal interest in it.
Lynda Waltho (Stourbridge) (Lab): I was pleased to hear several of my right hon. Friend’s comments, but may I return to the staff? Many of my constituents and those of my hon. Friend the Member for Dudley, North (Mr. Austin) work at the Dudley call centre. Many are women, some of whom are lone parents with family responsibilities themselves. I met several over the weekend who were concerned about what was coming out in the press and worried about what might happen to their jobs. Will my right hon. Friend take this opportunity to congratulate those staff on their work and diligence up to now? They have coped with all sorts of reorganisations and their stress levels have reached the point at which many of them have become ill. They have sometimes suffered abuse from parents who have become upset on the other end of the phone. Will he not only congratulate the staff, but reassure them about their employment prospects for the future?
Mr. Hutton: I am happy to do that. The staff of the CSA do an immensely difficult job, often in difficult circumstances. It is incumbent on all of us in the House to do all that we can to support them in discharging the functions that we ask them to deliver on our behalf. As I said, we will certainly be working closely with the trade unions and the management to ensure that the reforms are a success. CSA staff have coped with major change before, so I am confident that they will be able to do so again.
Alistair Burt (North-East Bedfordshire) (Con): I listened to the Secretary of State with great care and with no little sympathy, as he would understand. Although he might have been irked to some degree by the reservations of my hon. Friend the Member for Runnymede and Weybridge (Mr. Hammond), I am sure he will recall that one of the reasons we are in the mess we are in is that the House was far too consensual during the passage of the legislation. The Secretary of State will be helped rather than hindered if careful and serious questions are asked at the earliest possible stage.
In ensuring that the levels of maintenance, even under voluntary arrangements, do not go back to the original derisory levels that caused the CSA to intervene, does the Secretary of State intend to venture
into the difficult territory of the relationship between access and maintenance, or will the new agency or new arrangements maintain the rigid separation between the two? Over the years, the difficulties of those two issues coming together have led to much unhappiness in the way in which child support is handled.
Mr. Hutton: I am grateful to the hon. Gentleman for his comments. I was not irked by the remarks of the hon. Member for Runnymede and Weybridge; I was just rather disappointed by them because he has not recognised the seriousness of our proposals. I hope that he will come to do so in due course.
We will keep custody and maintenance strictly separate. It is essential that we do so. I understand that in the heat of separation there are often difficulties around custody and access to children, but if we confuse the responsibility of parents to support their children financially with other issues, we will take a giant step backwards. We will not blur that distinction. As the hon. Member for North-East Bedfordshire (Alistair Burt) was one of the principal architects of the original scheme that we are trying to fix, I am sure that he will play an important role in our proceedings in the House.
Mr. Frank Field (Birkenhead) (Lab): In congratulating the Secretary of State on his courage in making today’s statement, may I make a plea for taxpayers? Since the Government rejected ministerial advice that the current system was not reformable, we have asked taxpayers to foot a bill of £50 billion for single-parent families. Does he accept that the more generous we are with the disregard under the new scheme, the bigger that bill will remain for individual taxpayers, and the more generous we are in the disregard, the more likely it is that some families will decide that it pays to pretend that they have split up, claim benefit and continue as they were? Are we not all wiser about the extent to which fraud can be committed from the response that we saw to the tax credit system?
Lastly, I make a plea that the Secretary of State keep together payment of maintenance and access. Many males who want to see their children and who regularly pay their maintenance feel that that is not taken into account fully in court. It is surely a sign of their good character that they have no access although every week they pay.
Mr. Hutton: I accept my right hon. Friend’s caution about the level of the maintenance disregard. I assure him that we intend to proceed very carefully in that regard. It is fundamental to the reforms, however, that if we want to move to a system whereby we encourage and, yes, incentivise couples who are separating to reach their own financial arrangements on separation, we will necessarily have to look at being more generous in relation to the income support rules. That is what we intend to do. As I said clearly in my statement, we are not moving to 100 per cent. maintenance disregard, because that probably would hold out the prospect of some of the perverse consequences to which he alluded.
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