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Palliative Care

Mr. Lindsay Hoyle accordingly presented a Bill to make provision for palliative care for persons who are suffering from a terminal illness; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 19 October, and to be printed [Bill 138].

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Orders of the Day

Child Maintenance and Other Payments Bill

Mr. Deputy Speaker (Sir Alan Haselhurst): Before I call the Secretary of State, I must tell the House that the Order Paper should have included a tag referring to the Fourth Report of the Work and Pensions Committee on Child Support Reform and the Government’s response.


The Secretary of State for Work and Pensions (Mr. Peter Hain): I beg to move, That the Bill be now read a Second time.

The Bill provides for a new system of child maintenance in Britain. At its heart is the commitment to ensure that whatever happens to the relationship between two parents, the interests of children must always be paramount. However, the Bill also learns from the lessons of the past. It makes tackling child poverty the No. 1 priority for the child maintenance system by ensuring that more of the maintenance paid goes directly to the children and by maximising the number of children living apart from one or both of their parents for whom effective child maintenance arrangements are in place.

The Bill actively promotes parental responsibility by removing the barriers that prevent parents from reaching their own voluntary agreements. Never again will mutually agreed maintenance arrangements be forcibly overturned by a compulsion for parents with care receiving benefits to use the Child Support Agency. The Bill embeds the principle of choice whereby those on benefits should have the same choice as those not on benefits to make their own arrangements or to utilise the new child maintenance and enforcement commission—CMEC—to access the statutory scheme. For the first time, the system will no longer discriminate against people simply because they are poor.

Mr. Mike Weir (Angus) (SNP): I appreciate and support what the Secretary of State is saying. The Law Society of Scotland has pointed out that under the terms of section 4 of the Child Support Act 1991, a voluntary agreement will be restricted to a 12-month period. Is that the Government’s intention? If not, will he consider the fact that many families need the assurance that an agreement will last longer than just 12 months?

Mr. Hain: That is not the interpretation that I would put on it, but I will certainly consider the hon. Gentleman’s point. We are seeking a durable, long-term basis not only for the children, but for the parents. There is no desire on my part to create, perhaps inadvertently, the situation that he describes.

David Taylor (North-West Leicestershire) (Lab/Co-op): It is a laudable aim to encourage parents to make their own arrangements. However, is the Secretary of State confident about the position of lone parents on low incomes, perhaps where the split has not been amicable, the non-resident parent is no longer around,
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income cannot be determined and is opaque, or payments are not being received at all? Given that the CMEC will often be required to act as a last resort in terms of assessment and enforcement, does he have any estimate of the number of cases that might arise, and will the CMEC have the resources to deal with them?

Mr. Hain: My hon. Friend makes a reasonable point. In these situations, people on low incomes are the most vulnerable and the children are therefore doubly the most vulnerable. The CMEC will have a very important role. However, a significant proportion—I think a third—of those involved would like to make their own voluntary arrangements, but are prevented from doing so by the current structures. We want to facilitate that, but we certainly intend to guard against the situation that he describes. There is the fall-back that the commission has a statutory obligation to act in the way provided for by the Bill, and that will happen.

Mr. Alistair Carmichael (Orkney and Shetland) (LD): Further to the Secretary of State’s answer to the hon. Member for Angus (Mr. Weir), may I impress upon him the importance of not undermining the very effective system that we have in Scotland of minutes of agreement, which are entered into after legal advice by both parties and are then registered in the books of council and session, which means that they are summarily enforceable? If those minutes of agreement can be overturned after 12 months, as seems to be the case under the Bill, there may be less incentive for people to enter into them. Will he consider removing the 12-month limit or at least extending it to something in the region of 48 or 60 months?

Mr. Hain: We are trying to put in place a more sensible and flexible alternative, and I think that there is widespread cross-party support for that objective. If such arguments are put persuasively in Committee we will obviously want to take account of them. We are not seeking to impose anything, but to make progress. I shall want to bear in mind the points that Scottish Members of Parliament have raised so far.

Mr. Frank Field (Birkenhead) (Lab): I hope that the whole House agrees that, where possible, people should come to their own sensible arrangements that they police themselves without involving any state authority. However, is there not a danger that the taxpayer may get lost in all this? The Henshaw report said that if we almost entirely disregarded benefit income, the number of people who made private arrangements would be a mega-number, and therefore the numbers going to the commission would be very small. Fortunately, the previous Prime Minister intervened to prevent the Henshaw doctrine having force immediately. When will the right hon. Gentleman be able to tell us how much benefit income will be disregarded for people who come to private arrangements?

Mr. Hain: We are still carefully researching incentives to work—an issue that my right hon. Friend has continually, and rightly, pressed—in order to get this right. I welcome his question, as he has been a missionary in this whole initiative from a very long way back. The commission will have a very important role. It will deal with a significant number of cases; it is not
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designed to be put into some kind of longstop role. However, as he says, if we can get in place private voluntary arrangements that people want to make, overwhelmingly, in many cases, that is the preferable alternative.

Mr. Field: I am grateful for the Secretary of State’s comments. However, let us suppose that the Government decide that £100 of benefit income will be disregarded. There would then be a huge push among families to say, “We’ve come to a private arrangement.” The carer would say, “I’m keeping £100 of taxpayers’ money, so it does not really matter what else the other partner contributes.” The loss to the taxpayer would be considerable, and ordinary working class families who are sticking together, and where there are two parents, would feel, “Gosh, yet again the rules are being rigged against those of us who are decent citizens.”

Mr. Hain: My right hon. Friend makes a fair point, as always. However, balanced against that is the need for arrangements to tackle child poverty, which is what the new commission is designed to achieve. As I am about to explain—when I get a chance—that is the Bill’s overriding priority, and I know that my right hon. Friend shares the ambition of pursuing that matter as a priority.

We must strike the right balance. We want to increase the disregard above the £10 that is provided for—in itself, it makes the families and children involved £10 a week better off, and that is welcome. But although we want to increase the amount, we must get the balance right and examine the impact that my right hon. Friend described and the danger of causing resentment among hard-working families, who are worried about other ways in which the benefits system works.

Chris Grayling (Epsom and Ewell) (Con): I appreciate, as I am in the same position, that the Secretary of State is new to the job. None the less, the previous Secretary of State said on 24 July last year—almost 12 months ago:

Why has it not been possible to present those details, not only last year but almost 12 months later, by the time of Second Reading? Will he assure the House that the information will be provided to the Committee before its proceedings start?

Mr. Hain: We must get the matter right, for the reasons that my right hon. Friend the Member for Birkenhead (Mr. Field) outlined. I do not want to establish an artificial timetable. [Interruption.] The Committee will be important and its proceedings will be studied carefully.

Mr. Michael Clapham (Barnsley, West and Penistone) (Lab): Clearly, creating a position whereby parents can reach an arrangement is important. Will my right hon. Friend set up measures to encourage parents to do that before the CMEC gets involved?

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Mr. Hain: Yes. One of the provisions of the measure and of the new non-departmental public body will be a strong information and advice service that reaches out and works with other stakeholders, including One Parent Families, to ensure that those matters are explained and that the process is encouraged. However, the commission will stand ready to step in vigorously, with the purpose of ensuring that the children are protected and get the entitlements that they deserve.

Danny Alexander (Inverness, Nairn, Badenoch and Strathspey) (LD): The Secretary of State has been generous in giving way. Let me clarify the point that he just made. Will the CMEC take responsibility for providing advice and information? Clearly, such provision is important, and several independent advice organisations, such as Citizens Advice, have expressed concerns that the plans are not clear and that, if the CMEC is to take the lead responsibility for advice provision, there could be a conflict of interest.

Mr. Hain: There will be no conflict of interest. We want to maximise the opportunities of, for example, Citizens Advice, One Parent Families and the Child Poverty Action Group. All were involved in the extensive, cross-party consultation that took place before the Bill was drafted and following the Henshaw report. While I am about it, I welcome the hon. Gentleman to his new position; I look forward to working and sparring with him.

The arrangements in the Bill provide for a simpler, less bureaucratic assessment process, with new powers to obtain data from Her Majesty’s Revenue and Customs. Never again will the system be frustrated by relying on non-resident parents to provide information on their earnings. The measure legislates for the creation of a new, non-departmental public body, with radically strengthened powers to recover maintenance from those who repeatedly fail to pay.

The new Child Maintenance and Enforcement Commission will replace the existing Child Support Agency and mark a clean break with the past. The new commission will have primary responsibility for all aspects of operational and policy delivery. The CSA was set up in 1993 to replace an inadequate system of court-administered child maintenance. Despite the best efforts of its staff, it has never fulfilled the purpose for which it was established. We all, including me, know that as constituency Members of Parliament. Its problems are well documented.

When we came to office in 1997, the agency cost more to run than it collected in maintenance. It took longer to process claims than the courts. We introduced the Child Support, Pensions and Social Security Act 2000, which made important changes, simplifying maintenance calculations and strengthening enforcement measures. The agency’s performance has improved. Since 1997, it has doubled the number of children who receive maintenance payments—that is a credit to its hard-working staff, who do a good job in difficult circumstances.

The operational improvement plan is helping us to go still further in ensuring that the agency delivers for the parents and children who currently depend on it. That means that 200,000 more children will benefit from maintenance payments, with an additional 40,000 children lifted out of poverty. However, the operational
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improvement plan for the CSA was designed only to stabilise it and improve its performance in the short term. It cannot address the underlying structural weaknesses of the system.

For that reason, Sir David Henshaw was asked early last year to advise on a fundamental redesign of the whole system. The Bill builds on his recommendations and embeds three principled objectives in the heart of our reforms. They are to enforce children’s rights and parents’ responsibilities by maximising the number of cases; to provide a cost-effective and professional service, which gives the taxpayer the best value for money; and—most important—to make the greatest possible contribution to lifting families and children out of poverty. The Bill will deliver those objectives.

Together with the operational improvement plan, we expect the Bill to increase the number of parents who receive maintenance payments by 90 per cent., cut administration costs by approximately £200 million and lift a further 100,000 children out of poverty.

Mary Creagh (Wakefield) (Lab): Has my right hon. Friend had time to talk to my right hon. Friend the Secretary of State for Justice about the Law Commission’s review of reforming the law for couples who live together? It is due to be published shortly and will examine more closely what happens when cohabiting couples split. It considers not only the revenue allocation for children and child support, but—critically—the capital allocation, especially the house where the child is resident. Has my right hon. Friend has a chance to discuss that yet?

Mr. Hain: I must confess that I have not. I will ensure that I inquire into the matter and I am grateful to my hon. Friend for drawing it to my attention because it is important and we must not overlook it. The Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Warwick and Leamington (Mr. Plaskitt), our colleague in the other place Lord McKenzie and I will consider the matter.

John Penrose (Weston-super-Mare) (Con): The Secretary of State mentioned the importance of cost effectiveness. Will he clarify whether couples who have a voluntary agreement that breaks down can obtain enforcement of the agreement via the CMEC or will they have to get a CMEC agreement first? If the answer is the latter, it will be much harder to be as cost effective as I believe that he would like it to be.

Mr. Hain: As I shall explain shortly, an escape route back to the CMEC is important in the event of a voluntary agreement breaking down. We need to examine the precise way in which that will happen. It is important to ensure that the necessary safeguards are in place for the commission to play a statutory role in ensuring that the parent with care and the child or children are protected in such circumstances.

John Penrose: I thank the Secretary of State for that response, but I am trying to make the point that if one cannot enforce a voluntary agreement that breaks down other than by creating a new CMEC case, that will reduce the effectiveness of and public trust in voluntary agreements, and he will fundamentally undermine the basic principle of trying to give people an alternative to having to go to the CMEC.

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Mr. Hain: I thought, at first, that I was agreeing with the hon. Gentleman, but I must flatly disagree with him—I do not say that antagonistically. The new commission will have enforcement powers and provide the necessary protection. I do not understand how it can reincarnate a voluntary agreement. Its role is to provide encouragement for voluntary agreements—that is the new feature of the system, which I know that the hon. Gentleman supports. However, its back-stop role is to ensure protection and statutory backing when necessary.

David Taylor: The Secretary of States mentions the welcome news that 40,000 more children will be raised out of poverty—a matter linked with the raising of the disregard and making it cost-effective for the taxpayer. Is it not the case that if there were an absolute disregard of child maintenance income—in respect of jobseeker’s allowance and income support, for example—the number of children lifted out of poverty could be doubled, at a cost of about £200 million, which, though substantial, is less than it would cost if the same effect were achieved through the tax credit system? Is that not worthy of further consideration?

Mr. Hain: We obviously have to be very careful about the impact on work incentives. However, the principle behind lifting the disregard in the way the Government and I want is ensuring that those parents who are not currently paying as they should—because they believe that the money is going to the taxpayer rather than to the children—are encouraged to pay. That problem amounts to a very significant blockage in the existing system, so it is important to get the balance right, as my right hon. Friend the Member for Birkenhead quite properly said earlier, but at the same time we must not lose sight of the main objective—to lift children out of poverty. As I will explain in more detail later, that contrasts considerably with the aims and circumstances that led the original agency to be established by Margaret Thatcher’s Government.

Mr. Frank Field: The Secretary of State is providing an estimate of the number of children who will be lifted out of poverty as a result of the Bill. Such lifting will occur in two ways. First, maintenance payments that are not currently paid will flow to the relevant families; or secondly, the disregarded income will be changed. I would suggest to my right hon. Friend that his civil servants must have made a calculation that assumes a change in the level of disregard in order to allow him to provide the estimate that he has put before the House today. Will he place in the Library at some later stage a note providing a breakdown of the extent to which the disregard is being changed and of the extent to which increased maintenance payments are envisaged in order to justify the target of lifting so many children out of poverty?

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