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“must not be contaminated with previous failings.”
Why are the Government not listening to what Sir David Henshaw talked about in his recommendations? Henshaw raised many issues that the Government have failed to cover in any detail in the Bill.
The Government’s position on reform has been somewhat uncertain in recent years and perhaps that is why we feel that the lack of detail in the Bill is so concerning. The Under-Secretary of State for Work and Pensions, the hon. Member for Warwick and Leamington (Mr. Plaskitt), as recently as January 2006, rejected the idea of simply shutting the Child Support Agency down. He said:
“Simply scrapping it or closing it down might look attractive in terms of dealing with some of its problems, but it would only create another heap of problems that someone else would have to pick up. It is, in fact, a simplistic solution to suggest that the only thing to do is shut it down.”—[ Official Report, 9 January 2006; Vol. 441, c. 10.]
The right hon. Member for Sheffield, Brightside (Mr. Blunkett)—the Secretary of State before last—requested a plan for the wholesale redesign of the present system, which was put forward by the chief executive. That was then scrapped by the right hon. Member for Barrow and Furness—the next Secretary of State—and Sir David Henshaw was brought in. Now the Government are advocating a move towards more voluntary agreements, although there is precious little detail in the Bill. That idea was roundly rejected by the right hon. Member for Birkenhead (Mr. Field)—who made some excellent contributions to the debate earlier—when he was Minister for Welfare Reform. So a lot of contrary views have been expressed.
We want to see more detail in the Bill so that the culture change that has been talked about will be driven through and have results for families and children in all our constituencies. We fear that the Bill is too simplistic. Far more detail needs to be woven in in Committee to ensure that parents are supported to take responsibility for their child’s maintenance. It is clear from the debate today that the Government cannot let this be yet another missed opportunity to
establish a maintenance system that works, and we will work with them to ensure that that does not happen.
Child maintenance is a critical factor in supporting child welfare and we have no option but to get our child maintenance system right. Each and every year, between 150,000 and 200,000 couples with children separate. Indeed, 15 per cent. of children never live with both their parents and more than 1 million children in lone parent households live in poverty. Effective maintenance is crucial and we will do all we can to support the Bill to be better at providing an effective maintenance structure.
Members have already talked about the importance of the Bill in terms of alleviating child poverty. My hon. Friend the Member for Bexleyheath and Crayford cited Lisa Harker’s report, which pointed out that 42 per cent. of children in poverty are living in lone parent families and that maintenance ought to play a much greater role in reducing child poverty. However, as I am sure the Minister is aware, under the present system just one in five lone parents receives maintenance payments. The Secretary of State himself pointed out that child maintenance makes a paltry contribution to reducing child poverty in this country. That is in contrast to other countries—not just countries in northern Europe, but Austria and Switzerland as well.
My hon. Friend the Member for Epsom and Ewell said that this is not a time to sit back and bask in consensus. Although we welcome the Government’s proposals to put in place some more building blocks to improve the current system, we believe that we need to move further. We support parents taking responsibility. We welcome the decision to scrap the CSA, but we need to make sure that the new organisation is not contaminated by previous failure. We welcome the innovative idea of CMEC being a commissioner of services, but we need to see the flesh on the bones of that idea and that detail is not currently in the Bill.
We welcome the move to a more robust form of assessment, based on previous years’ income and using HMRC data, but the transition to the new system for those suffering as a result of the current chaos is just too slow. Why cannot we fast-track the change in assessment, as my hon. Friend suggested? We also agree that effective enforcement is an important part of creating a new culture, but if faith is truly to be restored in the child maintenance system, we need to make sure that enforcement goes hand in hand with a more reliable and accurate assessment system.
The Bill contains precious little detail on many of the areas that hon. Members have raised today. In Committee, we will press for more detail from the Government. It is important that we do not just wait for regulations to come through. For example, we need more detail about how we will support private agreements to be more effective, rather than just one-week wonders. Such concern has been raised by not only Conservative Members, but the Work and Pensions Committee, the National Council for One Parent Families and the Child Poverty Action Group. I hope that the Minister will take the point seriously and give us his considered and detailed views in Committee on how such agreements will work.
The repeal of section 6 of the Child Support Act 1991 will mean that it will no longer be mandatory for those on benefits to apply to the CSA. As other hon. Members have asked, is there a need to link the repeal of the section to ensuring that additional information and support will be available for families so that they can make their own private agreements? Without such a link and a change to the level of disregard prior to the repeal, some families might fall through the child maintenance net, so will the Minister reassure us on that matter?
At the heart of the Bill is the Government’s desire for parents to take more responsibility. Will that principle extend to the recovery of arrears? The Government are sidestepping in the Bill the question of charging fees for making agreements. In Committee, we will need to hear about how that will be handled.
All these matters cannot be left to regulations, so we will need a full debate on them in Committee. I hope that the Government will come forward with draft regulations or amendments to the Bill before that stage.
The provisions that will change the way in which mesothelioma will be dealt with are the other important element of the Bill. There is no cure for that cruel and distressing disease, about which the hon. Member for Barnsley, West and Penistone spoke in depth. We will be pressing the Government for more details on their intentions because, as is the case for so much of the Bill, a great deal will be laid down in regulations. Again, we hope that the Government will publish draft regulations so that we can discuss them in detail in Committee.
There is much work to be done in Committee to take the Bill forward so that it brings about the culture change that is needed to ensure that children in this country receive the support that they need from their parents throughout childhood. As my hon. Friend the Member for Epsom and Ewell said, the family is created when the child is born. Whatever happens to the relationship between parents, their family responsibilities persist. The Bill needs to support families to take responsibility for giving children the support that they need throughout their childhood to help to ensure that they get the start in life that they deserve.
4.58 pm
The Parliamentary Under-Secretary of State for Work and Pensions (Mr. James Plaskitt): We have had a thoughtful debate—I am inclined to say that it was something of a specialist debate—during which the Bill has received broad general support from hon. Members on both sides of the House, which I welcome. The Government accept that we have come to the end of a road on which we all embarked in 1990 with the White Paper that heralded the introduction of the Child Support Agency. The agency was brought into being because of the failures of the previous court-based arrangements. It is worth remembering that the White Paper referred to that court system as
“fragmented, uncertain in its results, slow and ineffective”.
“In a great many instances, the maintenance awarded is not paid or the payments fall into arrears”.
Since then, successive Governments have tried to tackle the issue of securing child maintenance via the CSA. As we all know, there were valid reasons for
embarking on such a route in the first place. There have been valiant attempts to try to make the system work. However, we have come to the view that the system is fundamentally flawed. Despite the fact that billions of pounds in maintenance have been collected by the CSA, and despite the fact that more than 650,000 children are currently being supported with maintenance payments as a result of the CSA, confidence in the agency has been lost. That is why we came to the conclusion that a new approach was necessary.
The main lesson learned by all of us is that the CSA approach was just too complex. The agency was being asked to do too much: it was asked to be the calculator, the adjudicator, the administrator and the enforcer. Indeed, as the National Audit Office concluded in 2006:
“With hindsight, the Agency was never structured in a way that would enable the policy to be delivered cost effectively.”
Since taking the decision in 2006 to make a fresh start, we have moved quickly. We have been strongly supported by the staff in the existing agency who, above all else, want to be part of a successful child support system.
The new start envisaged by the Bill has today been widely welcomed by Members across the House, and by virtually all the stakeholders who have commented on the proposals so far. I cannot improve on the observations of the Child Poverty Action Group, which said:
“the Bill provides an important opportunity to improve the lives of children and families.”
I turn to the main points raised in this afternoon’s debate. To begin with the issues raised by the Opposition Front Benchers, the hon. Member for Epsom and Ewell (Chris Grayling) rightly spoke of the frustration felt by many parents with care, and indeed by some non-resident parents, as a result of the problems with the agency. I was pleased that he moved on to say that the Conservatives share our aspirations for the Bill. He said that, at the moment, it is too easy for too many parents to evade their responsibilities, but that is why the Bill envisages significant new enforcement powers. The hon. Member for Basingstoke (Mrs. Miller) asked about those powers, which are very important. There are new powers to give us means of accessing accounts, powers relating to financial institutions, powers to notify credit reference agencies—that can have a significant impact, particularly on self-employed people—and, of course, powers giving access to Her Majesty’s Revenue and Customs income records. All those measures will help us to prevent people from evading their responsibilities.
It was disappointing when the hon. Member for Epsom and Ewell tried to suggest that there had been 10 years of neglect, and that disappointment was made obvious by other Members who spoke. There was, of course, a programme of improvements in 2000, which was implemented in 2003, and which the Conservative Front Benchers of the time supported. More recently, we introduced the operational improvement plan, which, again, was welcomed by the Opposition Front Benchers. It has been in operation for only a year, but already 58,000 more children receive maintenance payments, and the backlog of uncleared cases is down by 80,000 since we got going with the plan. It is not the case that there has been 10 years of no effort to try to make the agency work better.
The hon. Gentleman asked what was different about the envisaged reform. He said that the transfer of the same staff implied that there would not be any difference. That is unreasonable to the staff, who cannot be blamed for the systemic failures in the agency’s design and who want to be part of a successful operation. Indeed, it is important to retain their expertise so that they can help us as we go forward with the new operation. He wanted to know about the IT system. A number of fixes are being rolled out right now, and it is important to get that right before the Child Maintenance and Enforcement Commission assumes all its responsibilities. He wondered why the process was taking some time, but of course we are taking time to ensure that we get it right this time.
The hon. Gentleman overlooked other measures included in the proposal that show just how different the new system is. I have already spoken about the new powers; we are also introducing new support for voluntary agreements and repealing section 6 of the Child Support Act 1991, which has forced so many people who did not need to use the agency into contact with it. There is a new information platform that we can work from, which includes data-sharing with HMRC, and there will be a wider use of disregard. Those are all fundamental changes.
The hon. Gentleman asked about the role of the voluntary sector, which indeed has an extremely important part to play in helping us deliver the reforms. We are in discussion with the voluntary sector about the evolution of the support and advice services, which will be an important part of the new arrangements.
The hon. Gentleman complained about the lack of detail at this stage, but if we have learned anything from the experience of the CSA, surely it is the importance of getting the detail right. He will understand that the Bill puts in place the basic architecture. It is crucial in many respects that the commission be allowed to evolve particular ways of doing things in the light of the duties with which it will be charged under the Bill. That is the right way to go, as opposed to the more micro-managed and over-complex approach which bedevilled the agency. We must learn the lessons from the agency. Regulations will be rolled out over 2008 to 2010 before the CMEC becomes fully operational.
Mrs. Miller: The Minister speaks about the importance of developing an architecture for the commission. I understand that, but one of the basic parts of that architecture is the income disregard. We had a lengthy debate across the House about that because we are all concerned about it. Can the Minister shed a little more light on the work that has been done on that and when the Government will be more forthcoming?
Mr. Plaskitt:
There are two main parts to that. The extension of the £10 disregard will come in quite quickly. As is clear from the Bill and everything that we have said, it will be extended to those on old cases. In respect of a higher amount applied across the board, as we said early in the debate it is essential to determine the correct level. That is not a back-of-the-envelope calculation. There are important assessments to be made. There are many dimensions—the cost of it, the impact on parents with care, the interaction between different levels of disregard, and work incentives. It is a
significant change and it is important to get it right. There will be opportunities to discuss that further in Committee.
Danny Alexander: Before the Minister leaves the subject of detail that will be in regulations, can he set out for the record which regulations the Government intend to publish in draft form before the Committee stage?
Mr. Plaskitt: As I have indicated, given that the CMEC comes into being only in 2008 and steadily increases its duties up to 2010 and the transfer process rolls on thereafter, it is important to take time and get the details right. I will not give the hon. Gentleman a precise timetable for the emergence of regulations. It would not be appropriate to do so. I stress that we have all learned the importance of getting the system right. There will be plenty of opportunity in Committee to debate all the aspects that will be subject to regulation.
The hon. Member for Basingstoke began by talking about enforcement and pleaded that we should defer those measures, although she seems to be asking us to go faster in other respects. The enforcement measures are needed now. There are opportunities right now for parents to evade their responsibilities. We all share a concern about that and wish to see effective enforcement measures brought into being as quickly as possible.
The hon. Lady mentioned the increased number of clerical cases and attributed that to IT failures. They are not all down to IT failures—there are other reasons why some cases become clerical. They are being separately dealt with and we are trying to clear them. In many instances those are the toughest and most complex cases. We have set up a specialist unit to deal with them and we hope that they will be resolved quickly.
The hon. Lady seemed to suggest that we were not doing what David Henshaw recommended, but we are doing precisely what he recommended. I think that she misinterpreted what I said about not shutting down the CSA. Of course I would not advocate that. It is important always to bear in mind the interests of the children who are being supported by maintenance. I was arguing that simply to close down the CSA and then later introduce something different would leave a yawning gap in the middle, in which children would not be supported. It is important that we move seamlessly from existing systems to new ones without dropping the ball in terms of getting maintenance payments through to children, which is the essence of what we are about.
I am sorry that the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Danny Alexander) is pessimistic. I hope that when he and his wife have had their happy event he will become optimistic, and I congratulate him on that impending news. I am pleased that he supports the principles. He raised concerns about the debt issue, and that is very much a legacy problem. The debt started to accumulate from day one of the CSA and has grown immensely throughout. The Bill deals with what can be done to handle debt better, and there will be an opportunity to negotiate reasonable settlements where there is consent between
the parties involved. We are introducing the power to have lump sum deduction orders, which is a means of collecting arrears that we have not had before. The Bill introduces the option of selling debt to private purchasers and we are already beginning to use private debt collectors. However, as he knows, there is no general power of write-off, and nor should there be.
I appreciate the positive comments that the hon. Gentleman made about the staff who work for the agency. There is a programmed reduction in numbers from the present level, but it simply takes the numbers back to the kind of level that they were at before the operational improvement plan came into being. Once that plan has tidied up many of the legacy problems that it was designed for, the agency should be able to operate on the numbers that it had before. As we move into the new commission-based arrangement we anticipate fewer numbers coming through, and it will be reasonable to expect the opportunity to take staff numbers down further. Precise decisions on that will be for the new commission.
Michael Jabez Foster (Hastings and Rye) (Lab): I apologise for not being present for much of the debate, but on the question of staff numbers, in my constituency people have been offered assurances that there will be no reduction in total staff. How can the Government follow that assurance if they have delegated responsibility to a non-departmental Government body?
Mr. Plaskitt: As my hon. Friend knows, we have already published staff numbers through to 2008 as part of the Department’s existing commitments. Staff will transfer to the new commission with protection under the Transfer of Undertakings (Protection of Employment) Regulations 1981. Neither we nor they can at this point make firm commitments about staffing levels beyond that.
I was disappointed to see that the hon. Member for Inverness, Nairn, Badenoch and Strathspey is still clinging to his party’s proposal that we hand the whole operation over to HMRC. I welcome him to his post—he has had two years as the understudy, and he now has the opportunity to revise the policy. He does not have to be committed to it any longer. I hope that he will think again about handing the whole operation over to HMRC. There are important reasons why that would not be the appropriate route and he knows that that is my and the Government’s view. He should bear in mind that in those systems where the child maintenance collection arrangements are operated by the equivalent of HMRC, the system is underwritten at the same time. I have never heard him propose that. I hope that he will have the opportunity now that he is top man on this to have another think about that aspect of Liberal Democrat policy.
I am pleased that the hon. Gentleman welcomed powers of increased enforcement, because that is something of a contrast with what some of his Liberal Democrat predecessors have said. They expressed concerns about human rights in respect of previously existing enforcement powers.
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