 House of Commons |
Session 2006 - 07 Publications on the internet General Committee Debates Child Maintenance and Other Payments |
Child Maintenance and Other Payments Bill |
The Committee consisted of the following Members:Chris
Shaw, Committee
Clerk
†
attended the Committee
Public Bill CommitteeTuesday 24 July 2007(Morning)[Mr. Christopher Chope in the Chair]Child Maintenance and Other Payments BillClause 6Fees
10.30
am
Danny
Alexander (Inverness, Nairn, Badenoch and Strathspey)
(LD): I beg to move amendment No. 68, in
clause 6, page 2, line 27, after
‘fees’, insert
‘to a person who has
failed to pay an amount of child support
maintenance’.
It
is a pleasure, Mr. Chope, to serve under your chairmanship
for the first time. This is my first contribution to these debates, but
I promise it will not be my last. Having spent the last couple of weeks
learning for myself the obligations of parenthood, I have been afforded
a degree of time to study the evidence given to the Committee and the
debates that have taken place so
far.
Amendment No. 68
and subsequent amendments relate to the subject of fees and the
potential of the new Child Maintenance and Enforcement Commission to
charge for its services. They are matters about which there is the
potential for some controversy.
I note that at point No. 10 in
his written submission, Professor Nick Wikeley
said:
“The
question of charging fees will doubtless be
controversial”.
He went
on to say:
“The
obvious point is that charging fees is unlikely to be effective if
customer service remains at current levels.”
We will come to that when we discuss a
subsequent amendment.
With amendment No. 68, I wish
to probe the Government’s intentions about the circumstances in
which they intend to charge fees. The note in the evidence that was
kindly given to Members in a folder in advance of our deliberations is
pretty opaque on the matter. Things were not made a great deal clearer
when I read the oral evidence taken during the Committee’s first
two sittings.
In
evidence, Lord McKenzie said:
“No decision has been
made on charging
yet.”
However, even from
the evidence, the nature and purpose of the charging regime that the
Government seek to introduce was fairly fuzzy and opaque. On the one
hand, Lord McKenzie said that he did not wish to
“force
people—particularly low-income families—out of the system
and prevent them from entering into proper and effective maintenance
agreements.”
Hilary Reynolds thought that it
was
“highly
unlikely that charging would start before
2010”.——[Official Report, Child Maintenance and
Other Payments Public Bill Committee, 17 July 2007; c.
12.]
However, that does not
preclude it starting before that date, although the Government’s
note on the matter is slightly clearer. Will the Minister clarify the
timing on
charging?
Although
Lord McKenzie said that he did not wish low-income families to be
penalised by charging, he also said:
“Clearly we would wish
people to be incentivised to use private agreements...and
therefore, I suppose, not to use the system unnecessarily if it can be
avoided and if it is not
appropriate.”——[Official Report, Child
Maintenance and Other Payments Public Bill Committee, 17 July 2007;
c. 13.]
If the purpose of
charging is at least in part to incentivise people to make private
agreements, the flip-side is that if the charging regime is pervasive
it will serve to disincentivise people from making an application to
CMEC.
The purpose of
the amendment is to try to narrow the range of people to whom fees may
be charged. Specifically—the Minister made this point in oral
evidence—fees may be useful in cases when people such as
non-resident parents fail to discharge their obligations, as the fee
would be more like a penalty. The amendment suggests that fees should
be payable by those who fail to comply with their obligations—in
this case, by failing to pay child support maintenance.
It would help
if the Minister made clear his intentions about the range of people to
whom charges might be applied. Clause 6 leaves it wide open. Fees could
be charged to any and all people who interact with CMEC in any way,
whether parents with care or non-resident parents. They could be
charged in a range of circumstances. It has been explained that the
issue is not principally about cost recovery. None the less, a charging
regime that leaves open the possibility that a level of charges might
be introduced for all applicants, including parents with care, that is
sufficient to incentivise private agreements—in other words, add
a sufficient amount to disincentivise people from choosing CMEC as
their first option—could be a boon to that type of
charging.
Mr.
Tim Boswell (Daventry) (Con): As ever, the hon. Gentleman
is making a measured case. However, does he agree that, even if we do
not want to tie down explicitly to the text of the Bill any
instructions to CMEC, it would be unfortunate if the charging regime
were to be operated penally in any way? It is one thing to give a
measure of incentive, but it would be another to depart from cost
structure or seek to punish individuals who chose to use the
service.
Danny
Alexander:
I am grateful for the hon. Gentleman’s
intervention. I agree with it in the sense that a charging regime must
not punish people simply for their choice of interacting with CMEC. The
existence of a child maintenance support system is a public good, so to
charge people willy-nilly to interact with the service seems wrong. The
amendment would make it clear that, in a certain category of cases of
those who fail to pay an amount of child support
maintenance—those who have gone through the CMEC system and have
not complied with their obligations—a charge might be a useful
additional incentive to encourage them to meet their
obligations.
The Minister has rightly made it
clear that the importance of the Bill is that it encourages those who
interact with the child support system to fulfil their
responsibilities. He has said continually that one of the major reasons
for the failure of the current child support system is that many
non-resident parents—mainly men—are not meeting their
financial obligations in quite disgraceful ways. The amendment would
allow fees to be charged in such cases, but it would exclude charging
to be allowed in the generality of cases for all parents with care or
non-resident
parents.
Mr.
Mike Weir (Angus) (SNP): I am following the hon.
Gentleman’s argument with interest. I am mostly in agreement
with him, but I am concerned that the amendment might put pressure on
people to enter a voluntary agreement that may not necessarily be in
their interests if fee charging is allowed and they fail to enter a
voluntary arrangement. I accept his argument when people reach the
stage at which they fail to honour their obligations, but I am worried
that such a proposal might become a problem at an earlier stage by
forcing them into voluntary agreements that are not necessarily in the
interests of one
party.
Danny
Alexander:
Perhaps I have not explained myself clearly
enough. In a sense, the hon. Gentleman supports my argument. A charging
regime, as the Bill allows, under which charges can be levied on all
classes of people who interact with CMEC, could serve such a purpose.
It could put pressure on people to enter into voluntary agreements. I
do not know what level of charges the Minister has in mind. If it is to
be set at £100 and there is a £10 disregard, it could
effectively be 10 weeks’ maintenance for a benefit case and a
significant
disincentive.
The
purpose of the amendment is to say that charges should not apply
automatically just because a person has applied to CMEC if the
voluntary agreement had fallen through, for example. Charges should
apply only when a person has been through the CMEC system and the
non-resident parent has been asked to pay money. If, in such cases, the
non-resident parent has failed to pay the child support maintenance to
which he is obligated, charges could then apply. In other cases, they
would
not.
Mr.
Weir:
I am not necessarily opposed to the amendment, but
is there not a danger that the fees will become an add-on to the
existing arrears? Does it necessarily help the parent with care to get
the money? Will the hon. Gentleman make it clear that the situation in
which the maintenance is paid first and the fees separately
would only come into play after the parent with care has received any
maintenance that is
due?
Danny
Alexander:
I am grateful for that
intervention. I intend to go on in the subsequent amendment, which I
know that the hon. Gentleman supports, to make the wider case against
the fees. I cannot imagine that any Committee member would disagree
with the argument that the payment of maintenance should take
precedence over the payment of fees. Will the Minister say whether that
is the Government’s position as
well?
Mr.
Mark Harper (Forest of Dean) (Con): I
want to pick up on one area that the hon. Gentleman referred to. In our
evidence-taking sessions, we asked the Minister, Lord McKenzie of
Luton, what split of cases the Government wanted to see going to the
Child Maintenance and Enforcement Commission versus going to private
arrangements. In that discussion, he confirmed that the Government had
no intention of using the fee-charging structure to reach a particular
target or split of cases between CMEC and the voluntary arrangements.
He said:
“We
want to use
them”—
presumably
the fees—
“to
encourage people to make choices that leave them in a position that we
and they believe is right.”——[Official Report,
Child Maintenance and Other Payments Public Bill
Committee, 17 July 2007; c.
20.]
That indicates that CMEC
has no guide to the purpose of the fees. They are clearly not about
cost recovery. That was ruled out in the evidence given by Hilary
Reynolds. The Government do not appear to have a view about the number
of cases that use CMEC versus a private arrangement. CMEC is not being
given a steer about how to set fees or what the purpose of the fees
is—in fact, it is getting no guidance at all.
The Minister needs to be clear
about the purpose of the fees. If the purpose is not cost recovery,
there must be some other point. One cannot separate setting the fees
against the incentive or disincentive effect that they are going to
have. By setting the fee, we are implicitly making a judgment about the
extent to which we wish people to use CMEC. I do not think that we can
separate those two issues. There is a fundamental confusion, which the
Minister needs to
address.
The
Parliamentary Under-Secretary of State for Work and Pensions
(Mr. James Plaskitt):
Once again, it is
a pleasure to have you chairing our proceedings, Mr. Chope.
I am grateful to those hon. Members who have spoken in the debate and
for the points raised by the hon. Members for Inverness, Nairn,
Badenoch and Strathspey and for Forest of Dean, which I will try to
cover in my response.
Let me begin by pointing out
the importance of clause 2(1), which we discussed before. Any decision
about fees that CMEC might make in the future has to be made in the
context of the overall objective, which is clearly set out in clause
2(1). Any test that might be applied to a proposal to have fees will
have to be run against that objective.
The hon. Member for Inverness,
Nairn, Badenoch and Strathspey raised the concern that the charges
might become penal or that they might disincentivise people or produce
undesirable outcomes. In that case, the commission will not be meeting
its obligation under clause 2(1). Therefore, it is an important part of
the
test.
Mr.
Boswell:
I do not wish to disagree with
the Minister about that because I think that it is clearly what we all
wish. Does he not agree that as a matter of administrative law, the
commission as a public body will always and at all times have to act
reasonably—it will not want to attract attention from judicial
review—if
it sets the level of fees at any level which could at least arguably be
seen to be unreasonable as far as the individual is
concerned?
Mr.
Plaskitt:
That is quite a legitimate point. It puts
further constraint on the commission’s discretion to introduce
or consider any fee
regime.
It
was clear from the evidence of the Minister’s colleague, Lord
McKenzie, that one of the motivations behind the power to charge is in
relation to incentivising private agreements. However, for every
incentive there is an equal and opposite disincentive. How does the
Minister intend to get the balance right? If private agreements are
genuinely incentivised, how will he prevent the charges
disincentivising people from going to CMEC when they need
to?
10.45
am
The
Government recognise the importance of ensuring that a charging regime
does not dissuade vulnerable or low-income parents from applying to the
commission in the first place. Indeed, I remind Committee members that
the White Paper said
that
“the clear burden of
charging should fall on the non-resident parent and not the parent with
care.”
We would expect
any charging regime put forward by the commission to reflect precisely
that. I remind the hon. Gentleman that any charging regime must first
secure the approval of the Secretary of State. That will be followed by
a further check on any proposal, which I shall come to in a
moment.
Charges
may be incurred for a variety of reasons. The intention is that the
majority of them, such as penalties for late payment and enforcement
measures, will fall only on non-resident and non-compliant parents.
However, in a few situations, allowing the commission to charge a fee
at an early stage of the process—possibly to both
parents—might provide it with a tool to help it achieve its
objectives, of which I reminded the Committee at the
outset.
Mr.
Boswell:
I thank the Minister for giving
way again, but members of the Committee must be clear on this matter.
He mentioned charges for late payment. We know from our constituency
casework that one of the defects of the current arrangements is that
money has been collected from the non-resident parent but for some
reason has not found its way through the agency to the parent with
care—for example, either an employer is delinquent or there has
been an administrative glitch. Will the Minister assure us that CMEC
will do its level best to ensure that no arbitrary charge is levied on
those who are not being delinquent but who have merely been caught up
in an administrative problem?
Mr.
Plaskitt:
I am happy to give that reassurance. We are
making the changes precisely to achieve that degree of improvement in
performance and we have been making that stipulation for such
circumstances.
I
referred to circumstances in which fees might be applicable, and it
might be possible to envisage a small application fee coming into the
process, as is the case in a number of other child maintenance systems
in other parts of the world. That might encourage both parents to
consider whether a voluntary arrangement might be more effective for
them.
Above
all, we consider it too early to put a restriction in the Bill, as the
amendment would do. I would not want to fetter the commission in any
way at this stage, in terms of proposals that it might make in respect
of charges. It is important to give the commission the option of
putting forward proposals on charges and not to say that charges in
respect of certain things cannot be considered. The details of any
charging proposals that might come forward would be more appropriately
laid out in regulations. That is because the commission should play a
key role in finalising the detail, and also—the hon. Member for
Inverness, Nairn, Badenoch and Strathspey sought reassurance on
this—because fees will not be introduced until 2010 at the
earliest, and then only as clients move into the new
system.
I
hope that I have reassured the Committee that all regulations made
under the clause in respect of fees will be subject to affirmative
resolution; that is the second lock on the process. First, any
proposals must secure the Secretary of State’s approval, then
they must go through the affirmative resolution process, under which
they would be subject to additional parliamentary scrutiny.
I hope that I
have given hon. Members the reassurance that they sought on fees and
that it is sufficient to encourage the hon. Gentleman—whom,
incidentally, I must congratulate on becoming a parent—to
withdraw the amendment.
Danny
Alexander:
I am grateful to the Minster
for his response and final remarks. His reassurance has certainly
satisfied me and I beg to ask leave to withdraw the
amendment.
Amendment,
by leave,
withdrawn.
‘(1A) The
Secretary of State may only make regulations under subsection (1) when
he is satisfied that the Commission is capable of providing a
satisfactory service to parents and children in terms of its duties
under this
Act.’.
Although
the Minister offered reassurances on the way in which the Government
intend to decide how charges could be applied, a much broader issue
needs to be raised in relation to the charging regime, and the
amendment seeks to do that. It relates to the evidence that the
Committee heard from Professor Wikeley, who said that the obvious point
is that charging fees is unlikely to be effective if customer service
remains at current levels.
The amendment
seeks to establish on the face of the Bill an equation between the
ability to introduce charges and the ability of the new organisation to
deliver its services competently, something that has been sadly
lacking from the current Child Support Agency regime. That was debated
in earlier sittings, but I make no apology for returning to
it.
I noted the
Minister’s comments about morale among CSA staff in an earlier
debate about improvements under the operational improvement plan. That
is obviously important, and I would be interested if he were willing to
lay before the House—perhaps in the Library—a copy of the
recent staff survey that Lord McKenzie referred to, so that members of
the Committee can see in detail the opinions of staff on the range of
issues that are, no doubt, pertinent to this amendment and
others.
Morale among
CSA claimants, rather than staff, would be a better measure of the
degree to which it is performing its functions effectively, although I
do not think that I need to go through the evidence in
detail.
Mrs.
Nadine Dorries (Mid-Bedfordshire) (Con): I totally agree
with the hon. Gentleman’s comment that the morale of the
claimants would be a good measure of effectiveness. As he said, the
morale of staff is also important, but another good measure would be
how often hon. Members have to use the hotline, should the hotline
still be available when the new service is in place. I would like the
Minister to reaffirm whether hon. Members will still have access to the
hotline because, unfortunately, in cases of desperation, we need to use
it
frequently.
Danny
Alexander:
I hesitate to speak for the Minister on those
matters, although I note that, in the evidence session, his colleague
in the Lords, Lord McKenzie, made clear that the MP hotline would
continue. Without wishing to speak for the Minister as a matter of
habit, I hope that I have made that point clear. However, the wider
point that the hon. Lady made is absolutely right. The amendment, which
would establish an equation between the competence of the organisation
and the ability to level fees, would allow a much wider range of
measures to be employed. It is not simply a matter of
competence.
On Second
Reading, hon. Members on both sides of the House referred to the
hard-working nature of the staff and the fact that many of them are
talented, competent and yet are struggling under the weight of a system
that has been incompetently devised. I am not sure that the new system
will mark a huge improvement on that, but we will, no doubt, come to
that as we work through the Bill. That point is important. The major
reason why we are in Committee debating the Bill is that the current
system has been such a hideous failure for so many of our constituents,
and every hon. Member in the Committee will have had dreadful
experiences with that at a constituency level. The Minister, in his
closing remarks, seemed slightly firmer on the introduction of charges
in 2010 than we had previously allowed—he made it clear that
charges would be introduced in 2010 at the earliest. It would be
interesting to know whether he intends to introduce the regulations in
2010 or whether he does not yet know. I suspect that he may say that
that is a matter for the commission.
In any case,
if the level of competence and administrative efficiency in CMEC and
the legacy organisations has not improved, introducing charges would
add insult to injury to users. For people who have suffered for many
years from not having their maintenance obligations effectively dealt
with, levying charges would be hopelessly
wrong if the new organisation is unable to meet the higher standards set
by the Minister. Because of that, I want to return to the questions
that were raised about staffing levels in the
organisation.
Significant falls in the number
of staff are planned during the 18-month period that concludes next
year. The Minister said that those reductions relate to the operational
improvement plan that is currently being implemented, which he said has
been through its peak phase and is now winding down. I would be
interested to hear about any evidence that suggests that the
operational improvement plan has been successful because it would cut
to the burden of the amendment, which concerns the administrative
efficiency and competence of the organisation.
From a
constituency perspective, the Minister has been helpful with a
particular case and I remain grateful for his assistance. In all too
many cases that are less complicated and unique than that one, I cannot
say in all honesty that I have noticed a great deal of improvement in
the past 18 months. Other hon. Members may have had different
experiences. In my experience, it is extremely hard to find out what is
happening in cases that end up in the Bolton special case
unit.
Danny
Alexander:
I notice that the hon. Gentleman agrees. I
remain of the view that, with the significant staff reductions that are
planned, there is a risk that performance in the child support system
could go from bad to worse. The Minister will no doubt disagree with
that, but he ought to agree with the purpose of the amendment. He has
regularly made the point that the creation of the new organisation is a
major shift, not a re-badging or re-branding exercise. The reason why
he presents it as a major shift is that he is trying to change the
culture and operation of the organisation. If that is his objective, I
hope that he will support and welcome the amendment because it would
allow a mechanism for proving his
faith.
John
Penrose:
The amendment would bring about an
assessment of the overall or average level of competence. The hon.
Gentleman made the point that if CMEC falls below an average level of
competence, it would add insult to injury to levy charges. However,
does he accept that the experience of the Child Support Agency has been
that different classes of case pose different levels of difficulty?
Therefore, measuring an average level of performance does not address
the problems that people are experiencing because some classes of case
are more likely to be swallowed up by the black hole that is Bolton. It
may be necessary to table an amendment so that the assessment of
whether charges are acceptable would assess not only the average level
of performance, but individual levels of performance in specific cases.
If CMEC falls below an acceptable level of performance, it may be
necessary to think about reimbursing charges that might be levied on
those specific
occasions.
Danny
Alexander:
I am grateful for that intervention—the
hon. Gentleman makes an important point. While it is not specifically
within the scope of the amendment, I hope that the Minister will take
it on board. In his
earlier response, he made it clear that one option is for charges to be
levied in certain categories of cases, rather than more
generally.
11
am
Concerns have
been expressed about individuals who use the CSA in a vexatious way in
order to apply pressure to the other party, or other cases in which
there is non-compliance. Those are precisely the sort of cases to which
the hon. Gentleman has referred. They are often the more complicated
cases in which things are more likely to go wrong in the administrative
system, without the safeguard that he proposes. I hope that the
Minister will respond to that, and particularly to the point about
cases in which the individual has been let down by the administration
and in which charges should either not be levied or be reimbursed. That
is absolutely
right.
It would be
monstrously wrong for CMEC or the CSA to say, “We are going to
levy charges, even though we have got it horribly wrong in your
case.” Sadly, that is the experience of far too many people
throughout the country. That is why Janet Allbeson of One Parent
Families expressed in her evidence to the Select Committee her concern
about the introduction of charging by
saying:
“let us
put charging on hold; let us see how the system beds down; let us see
who is using the new system and why they are using it and then think
about charging and how that fits into it. It is too early, and can just
antagonise people and create unnecessary tension and
aggravation.”
It
is in precisely the sort of cases referred to by the hon. Gentleman
that unnecessary tension and aggravation will be felt particularly
strongly. In making a general assessment about the performance of the
organisation, we must consider not only the amendment, but performance
in specific cases when deciding whether or not charging is appropriate.
I look forward to the Minister’s response to the important
equation that we seek to
establish.
Mr.
Boswell:
I rise to reflect on the matter, rather than to
reach a substantive conclusion, and I have a number of points in mind.
The first basic point is that we would not be debating the Bill, if the
CSA were doing its job at the moment. We know that radical change is
required, and that change must be towards competence and satisfactory
performance. That is self-evident and is no reflection on the
individuals, who are doing their best, or on many of the people who
pass through its
portals.
As
a kind of mind game—I suppose it is the type of game that one
plays in a glide-path towards the end of a parliamentary
career—I occasionally fantasise about the Minister’s
objections. I will do that on the grounds that I may be more terse than
he is. I do not advise him to accept the amendment as such, but I speak
in spirit rather than in detail. We are delighted to have the hon.
Member for Inverness, Nairn, Badenoch and Strathspey back in Committee,
all the more so as I now realise why he was away.
My first objection—I
will be rude to the Minister for a minute—is that many of us are
somewhat cynical about certification by a Secretary of State in any
matter, whether it involves compliance with legislation
on human rights or otherwise. The amendment would effectively require
the Secretary of State or, more realistically in an individual case a
junior Minister, to certify that there was a satisfactory
performance.
My
second point, which is more helpful to the hon. Gentleman, is that
however good CMEC is, it is not the only party to the transactions. The
matter depends on the compliance and behaviour of other people and
frankly, one of the problems is that many parents who are absent or
non-resident have no intention of complying, however hard we try. It is
offensive to people, not least to those who are trying to care for
their children, when that situation arises, and I fully understand the
Minister’s wish to pursue such
matters.
I have some
subsidiary concerns. Capability is not necessarily the same as
performance. Even if the commission is capable of performing a
satisfactory service, it does not necessarily do so in every particular
case. Similarly, it might deteriorate having reached certification by
the Secretary of State on the back of its fees. Those are substantive
issues.
The nub of the
argument is what is a satisfactory service. We must expect the new
commission to perform in a satisfactory way in the great majority of
cases. Our concern, and the reason for the new measure, is that the
present agency does not perform adequately in the broad mass of cases
and performs execrably in a minority of cases. What is needed is a
normal performance—a default function that works—and for
proper attention to be paid to individual cases which, because of their
category or an administrative glitch, do not work. Only then can the
Minister claim success. The inference of the amendment, with which I
agree, is that at that point, and on that basis, it is reasonable to
start charging.
It is
worth spending some time on certain issues: first, we should not be
trapped by a date. As One Parent Families said in evidence, there
should be a perception that everything is working and is in a stable
state, and that the problems are finite and manageable. It may then be
appropriate for a fee to be charged. Those are perfectly sensible
criteria.
Secondly,
there must be an understanding at that point that individual
difficulties that arise—God knows, they arise with applications
for passports, driving licences and so on—can be handled
satisfactorily. I would have thought it self-evident that fees should
not be charged, or should be rebated, when there has been a failure of
service, especially when the service is generally satisfactory. The
Minister needs to go a bit further in relation to compensation.
Privately, I have always been a bit uneasy that the existing agency,
faced with evidence of its failure in a particular case, tends to say,
“We were right to check the 50 quid and tell the person it is a
compensation payment,” which is not necessarily always
appropriate. It is not as good as fixing the system.
The Minister needs to consider
not only the return of fees but compensation, when appropriate. We
touched on, but did not explore, the function of CMEC and its
responsibilities to its customers in respect of its ability to be sued,
for example. If someone had to make a private arrangement and it had
been validated by a lawyer, that lawyer would be liable in respect of
professional negligence and so forth. If CMEC is the broker of these
arrangements, albeit the broker of last resort, it has an obligation to
deliver properly.
We know exactly what the hon.
Member for Inverness, Nairn, Badenoch and Strathspey is arguing for,
and it is a worthy aim not to rush into things and not to charge fees
where there will clearly be continuing come-back. It is important that
when fees are charged there is a good reason for it, and they should
not be a loss leader. We should not regard fees as an excuse for not
paying the maintenance, which must be the first charge on anyone who is
contributing. There should be stability, and a proper regime for
redress in cases of failure. I am sure that that is what the Minister
wants to achieve, and it is the Committee’s duty to spend a
little time encouraging him to do
so.
Mr.
Weir:
I want to make a few brief
points on the amendment. We are here in the first instance because of
the failure of the Child Support Agency and the point made in Sir David
Henshaw’s report that a clean break is needed. However, I fear
that introducing fees will add new complexity to an already difficult
situation. The Bill states that the Secretary of State may make
regulation to introduce fees, when he is satisfied that the commission
is capable of providing a satisfactory service.
The Minister has already
accepted that the CSA is not fit for purpose, hence the Bill. However,
I draw a parallel with tax credits, when Minister after Minister stood
up in the House and said that there was nothing wrong and everything
was working fine, in the teeth of evidence from hon. Members on both
sides of the House who had problem after problem with tax credits.
Although I have every faith in the Minister, we need an independent
assessment of when the agency is performing
satisfactorily.
Mr.
Boswell:
Would the hon. Gentleman like
me to describe my discussions with my local welfare rights office the
other day? We produced a precise contrast between the means-tested
benefits, notably tax credits, which were generating a huge amount of
casework, and the very small number of cases where there was an
entitlement, such as to a pension, and where administrative issues do
not normally seem to
arise.
Mr.
Weir:
The hon. Gentleman makes a very good point. My point
concerns the system and how we decide when it is working
satisfactorily. We all agree that the CSA, despite the best efforts of
most of its staff, is not working in a satisfactory manner, and there
are many reasons for that. The hon. Member for Inverness, Nairn,
Badenoch and Strathspey mentioned the number of staff. There are
obviously resources implications, as there have been from the outset,
and there are IT problems. There is a host of problems, which has
undermined public confidence and the confidence of most MPs in the
CSA.
We all want
CMEC to be different. We want it to work and to provide a better
system. The priority must therefore be to get CMEC up and running,
working well and enjoying the confidence of both non-resident parents
and parents with care. I was interested in the Minister’s
statement, which gave the impression that CMEC may be considering
introducing charges from a fairly early stage. That would create
unnecessary complexity and would lead to disagreement between
parties.
I suspect, if
I may be cynical for a moment, that the reason for charges is to
encourage people into voluntary agreements or a standard form that may
be available on
the net. That is fair and well where parents agree, but in many cases
parents cannot agree, and CMEC will become involved. Charges are not
going to help matters in complicated cases where one parent is being
very difficult. Whoever has to pay the charge, it will be another piece
of grit in the oyster in trying to reach agreement between the
parents—it will irritate and lead to
trouble.
There is also
the problem of the level of fees, on which there has been no indication
as yet. I appreciate that that is a matter for CMEC, but unless the
fees are on a staggered basis, they may not mean much to someone who is
earning a reasonable amount of money. For someone on low income or on
benefit, however, they may make a huge difference to the level of child
maintenance.
Fees are
a cul de sac that we should not go down at this stage. The better
enforcement that is promised by the Bill is a better way of ensuring
that those who are liable to pay child maintenance will pay it. Fees
should be considered only once we are all satisfied through an
independent appraisal that CMEC is doing its job and that it is making
things better for parents with care and
children.
Mr.
Harper:
I have three relatively brief
points. What assessment has the Department made of the relative cost of
entering into private agreements? Clearly, if a private agreement is a
relatively straightforward standard agreement that can be downloaded
from the internet and entered into without taking legal advice, it will
be fairly cheap. On the other hand a private agreement that meets the
requirements of both parents as well as those of the children could be
more costly. That needs to be taken into account when setting the level
of fees.
If entering
into a private agreement is relatively expensive and the fee is not set
at an equivalent level, people will use CMEC instead of using private
agreements. That will lead to a situation that the Government have said
that they do not want, namely CMEC being the default mechanism. The
other thing that is not really laid out is whether any fee structure
that is set up will involve a flat fee, a fixed monetary amount, a
means-tested amount or a figure linked to the income or amount of
maintenance. What is the Minister’s
view?
11.15
am
I have asked
that because, according to the graph in the regulatory impact
assessment showing the number of cases and the level of maintenance,
the majority of cases involve amounts of money that are not very large,
although they are a lot for the parent with care. If the fees are high
enough to have any effect, they will be significant compared with the
amount of maintenance in the vast bulk of cases, but very small in the
smaller number of cases that involve a significant amount of
maintenance. Does the Minister intend to structure the charges so that
they vary according to the income of the
parent?
My final
point, which has been touched on by a number of Committee members, is
whether any fee structure will be worth the candle if it is
specifically designed not to be a cost-recovery mechanism. Given the
complexity of the maintenance system in general and the amount of money
that is likely to be collected
in fees in this case, will it be sensible to have a fee structure, a
charging mechanism and a method of collecting the money? Has the
Department thought about the amount that will be collected in fees and
the number of people who will have to pay them? If the fee level is low
and the number of parents—with care or without—fairly
small, it will not be worth the trouble of setting up a complex
structure. We might end up with one of those governmental situations in
which the staffing and running costs outweigh the amounts of money
being moved around to the extent that it makes no sense at
all.
Mr.
Plaskitt:
Hon. Members have raised a wide range of points.
I was going to reassure the hon. Member for Mid-Bedfordshire that there
is, of course, going to be access for MPs pursuing constituents’
cases, but she has
gone.
The
hon. Member for Inverness, Nairn, Badenoch and Strathspey raised a
number of points. First, he asked whether I could place the recent
staff survey before Parliament. Yes, I shall be more than happy to do
that. Then he spoke about staffing. He knows that we have increased
staffing levels in the agency in recent years as part of the
operational improvement plan to deal with a considerable legacy of
issues and problems in the agency. A concerted effort is taking place
during the three years of that plan to resolve those problems before we
move on to the new commission arrangement, but this is only the first
year of the plan. The agency, in common with other parts of the
Department, has a mission to achieve head-count numbers.
We envisage that numbers will
reduce gradually as we implement the head-count plan. That should take
the numbers back, broadly, to where they were before the boost to
staffing levels associated with the operational improvement plan. The
hon. Gentleman should remember that if the OIP does what we expect it
to do, a lot of issues will be removed from the agency, and as we move
into the new arrangement there will be different levels of people
coming into the statutory system. It will be for the commission, once
it is set up, to decide the staffing level that is appropriate for it
to run the services that it is deemed to have to run. It is important
to understand that the current trajectory on staffing numbers does not
presume decisions that the commission will make, and the hon. Gentleman
should not do so either. The numbers that are published relate to the
agency and to the head-count plan that applies to the
Department.
Danny
Alexander:
The Minister rightly enjoins
us not to make assumptions about CMEC staffing levels. Does that imply
that resources would be made available should the commissioner and his
board at CMEC decide that they need more staff? The Minister makes the
point that one year into the operational improvement plan, staffing is
on a downward trend that is expected to go through to March 2008. The
reduction is significant. Does he have early evidence that he can give
the Committee on whether, in that first year, the operational
improvement plan has succeeded to the extent that a reduction of 2,000
staff by March 2008 can be
justified?
Mr.
Plaskitt:
Let me see whether I can reassure the hon.
Gentleman on that with some of the results from the first year of the
operational improvement plan. So
far, 45,000 more children are in receipt of maintenance; a higher
proportion of non-resident parents are paying or using direct
maintenance, 61 per cent. of whom are on new schemes; the number of
uncleared applications, which was one of the big problems in the
agency, is already down by 31 per cent.; applications are being cleared
far faster with 61 per cent. being cleared in 12 weeks, up from
53 per cent. before the plan; telephony is certainly improving; and the
extra releases in IT are taking place to fix some of the problems
inherent in that system. Those are encouraging results from just the
first year of the operational improvement plan, which has two years to
go.
With the
operational improvement plan, we are focusing on the outcomes in terms
of the agency’s performance, which is the important thing to
keep an eye on. As the problems are resolved and as the IT releases go
in, a lot less will have to be done clerically. That will facilitate a
reduction in head count without jeopardising the continuous improvement
in the performance of the agency that we are looking
for.
The hon. Member
for Inverness, Nairn, Badenoch and Strathspey and others have raised
concern about the situation in Bolton, and I hope that I can reassure
them. Thirty-four thousand of the most complex cases in the agency were
transferred to Bolton for a concerted drive to try to tackle them. That
is a tough job, and I willingly accept that there have been
difficulties in the early phase of the operation. I will not dwell
entirely on those cases, but I will return to them in a moment. The
fact that those 34,000 really tough cases have gone to Bolton means
that agency staff who were dealing with them are free to deal with
other cases, which is helping to improve
performance.
We
want to see results coming out of the Bolton mission, but it is early
days. So far, it is administering £15 million in additional
maintenance payments as a result of focusing on those problems. Again,
part of the solution is getting the IT right, and there are further
releases to come for the Bolton operation this year, which should help
in getting on top of the
situation.
The
hon. Member for Daventry asked about the compensation scheme, which
will continue essentially as it is under CMEC. However, it is open for
CMEC to consider, in the light of its operations as it comes into
being, whether it wants to make further changes. At this stage I
envisage it taking on the existing compensation
scheme.
The
hon. Member for Angus asked, in connection with the amendment, how we
will know how the commission is doing. He wanted to know whether we can
assess its performance before it comes back to us or to Parliament
asking to implement any fee charging scheme. When discussing clause 9,
we will look at the reporting system and the annual report that the
commission must make. There are amendments that we will debate, but it
sets out the framework of how the Secretary of State and Parliament
will have a regular check on how the commission is doing against the
performance criteria in the Bill. Therefore, there will be a way of
measuring how it is doing against its objectives. However, I agree with
the hon. Gentleman that the critical thing is to get performance,
delivery to clients and enforcement right. That is what we need to keep
our relentless focus on. That is the point of the fundamental change
and the clean break that we are making with this Bill.
The hon. Member for Forest of
Dean raised some interesting points about fees. He wondered whether
behavioural impacts will arise from the structure of fees. I am sure
that that will happen, and that is one of the issues that the
Commission will have to think about, if it chooses to come forward with
a proposal for
fees.
One of the
things that we will want to see is its assessment on the potential
behavioural impacts of any fee structure that it proposes. It goes
without saying that we would not be inclined to support a fee structure
that has detrimental or adverse impacts. The hon. Member for Forest of
Dean asked whether the fee structure will be flat, varied or
means-tested. That is entirely an issue for the Commission, so I repeat
to him that any fee proposals that the commission comes forward with
are subject to affirmative debate in Parliament, so they will get
intense scrutiny before they are implemented. That will be the point at
which we can look at the questions that he has raised, should the
situation arise.
I
shall give way to the hon. Lady, but first I repeat the answer that I
gave to her earlier question, while she was out of the Room. She asked
whether MPs will continue to have access to the systems to pursue
cases. Yes, they
will.
Mrs.
Dorries:
I thank the Minister for that answer. I was
trying to make a wider point, because he gave that answer in the
evidence session.
With
regard to the fee structure, I have a practical suggestion. Can the new
scheme be given a six month run-in period while we see how it beds down
before the fee-charging scheme is introduced later? I mention that
because of particular cases involving fathers who are very difficult to
track down. When such fathers are tracked down, it is very difficult to
get payments out of them. I am worried that those people will disappear
altogether. Could we not see how the system beds down, and then
introduce the fee-charging
scheme?
Mr.
Plaskitt:
I am afraid that I cannot
agree with that suggestion, for a very simple reason. It is important
to understand the principle on which we are making these changes. We
are moving to a commissioning basis in the system of child maintenance.
I really do not want to fetter the commission in the decisions that it
is going to make. I understand why the hon. Lady has said that, and I
am sure that a whole host of suggestions about making various changes
will be made. However, the more that we hem in the commission, the less
clean a break it will be. That is how it has to be, and I want those
decisions to rest with the commission.
As I have said, if the
commission comes forward with fee-charging proposals, it will need the
approval of the Secretary of State and an affirmative resolution from
Parliament. It is not as if the subject is being lost from scrutiny and
that there will be no opportunity to raise the points that the hon.
Lady has mentioned—far from it. I want the initiative to rest
with the Commission, which is the point of the
change.
Mr.
Boswell:
Although I fully understand
that the Minister does not want to hamper or fetter the commission in
coming up with any fee-charging scheme, or in the general discharge of
its functions, would he mind if I put down a marker on the question of
costs? The clause, as drafted, has a cost-related fee structure, but
does the Minister agree that it is very important that CMEC at least
gets a grip on its costs in individual cases, in particular categories,
and at the margin in pursuing individual cases? Unless it understands
that structure, even if it does not reflect it in the unit charge, it
will not be able to manage its job or discharge the work efficiently
overall.
Mr.
Plaskitt:
I understand what the hon. Gentleman is saying,
and I potentially agree with him. I refer him back to clause 3, which
we debated last week. It includes an obligation to the commission
to
“exercise its
functions both effectively and
efficiently”.
One of the
tests whether it is functioning efficiently is the way in which it
spends its money and handles its costs. I agree with him, and the
opportunity for us to assess that is already covered by clause
3.
I shall now
return to the core of the amendment, on which the debate hangs. The
amendment poses some difficulties, although I understand why it has
been tabled. It would require a subjective test of the capability of
the commission and of what constitutes a satisfactory service. Any view
that the Secretary of State takes on those matters could be open to
challenge, which would threaten the validity of any regulations then
brought
forward.
The
amendment would potentially stop the introduction of fees until the new
scheme is up and running, when a clearer assessment of the
commission’s ability to provide a satisfactory service is
possible. That would prevent the commission establishing fees as an
integral part of the new scheme. That might be what the hon. Member for
Inverness, Nairn, Badenoch and Strathspey wants, but such fettering of
the commission is not appropriate at this
stage.
11.30
am
Let
me add, however, that the Child Support Agency charged fees between
1993 and 1995. The regulations allowing them to be charged were
revoked, partly because the service that the agency provided at the
time was simply not good enough to justify charging a fee. The
commission will have that experience in mind when it considers
arrangements for any future charging regime and its timing. That will
be borne in mind not only by the commission, but by Ministers, and
Parliament will bear that precedent in mind if and when charging
regulations are laid and considered under the affirmative procedure.
Given those reassurances and reminders, I hope that the hon. Gentleman
will withdraw his
amendment.
Danny
Alexander:
We have had a good debate and some important
points have been made. I should have referred to the experience of
charging by the CSA in my opening remarks. The Minister rightly made
the point that charging was withdrawn because of issues of
effectiveness. Notwithstanding his assurances, I believe that the Bill
would be improved by the amendment and I therefore seek to test the
Committee’s
opinion.
Question
put, That the amendment be made:—
The
Committee divided: Ayes 9, Noes
10.
Division
No.
6
]
AYESNOES
Question
accordingly negatived.
‘(3A) The
Secretary of State may by regulations provide that the provisions of
the Child Support Act 1991 (c. 48) with respect
to—
(a) the collection
of child support
maintenance,
(b) the
enforcement of any obligation to pay child support
maintenance,
shall apply
equally (with any necessary modifications) to fees payable by virtue of
regulations under subsection
(1).’.
The
amendment clarifies the intention behind clause 6(2)(f), which enables
regulations to include matters relating to the recovery of fees. The
amendment is modelled on section 47(4) of the Child Support Act 1991.
Fees will not be an effective tool if they cannot be enforced, which is
why the clause originally said that regulations could provide for the
recovery of fees. However, we felt that the intent of the provision
might not be clear enough, which is why we tabled the
amendment.
I am sure that hon. Members
remember that section 47(4) of the 1991 Act specifically states
that enforcement powers shall apply to fees. However, that section will
be repealed with the creation of the new fees provision. Despite the
reference in clause 6(2)(f), it could be argued that in its current
form the new fees clause does not give the commission the ability to
use enforcement powers to collect fees. That is not the intention, so
for the avoidance of doubt I am moving this amendment.
The amendment
makes no substantive change to the Bill. It simply makes it expressly
clear that the enforcement powers available to the commission,
including those set out in part 3, may extend to the collection of
fees. However it is recognised that some enforcement powers are not
proportionate to the collection of fees—I refer to measures that
we will come to later such as the removal of passports, curfew orders,
commitment to prison, and disqualification from driving. These powers
are clearly intended to be used for the collection of unpaid
maintenance payments. I assure the Committee that we do not intend to
use them just for the collection of fees, and restrictions to that
effect will be placed in regulations.
It is appropriate to set out the
exact details in secondary legislation, as it will allow any
restrictions placed on enforcement measures to be developed as an
integral part of the charging regime to which they relate. However, I
reiterate the importance we attach to ensuring that the measures are
used appropriately. Members of the Committee will of course have the
opportunity to scrutinise all regulations made under clause 6; again,
they will be subject to affirmative
resolution.
Mr.
Boswell:
I do not want to cavil with the Minister’s
intentions, not least when he is reinstating a piece of interesting
Conservative legislation. However, one thing has changed. The amendment
mentions
“enforcement of
any obligation to pay child support maintenance”.
We are bound to focus on CMEC—a
public body, albeit in a different form—and the obligations that
it may impose. Does that power extend to any obligation that the
parties may have undertaken in relation to a private
agreement—one that has not been through CMEC—or to any
other kind of obligation on the parties? I suspect that widening the
means of collection rather than making it exclusive to the Child
Support Agency may cause a slight
difficulty.
Danny
Alexander:
I wish to make one brief point. The Minister
made it clear that these sensible and proportionate provisions are
necessary to ensure that the Bill operates as the Government intend.
Under paragraph (b) of the amendment,
“the enforcement of any obligation
to pay child support maintenance, shall apply equally...to fees
payable by virtue of regulations under subsection
(1).”
Will
the Minister clarify whether using the enforcement powers to collect
fees will apply only when maintenance is also being collected? For
example, if someone has started to pay maintenance but for some reason
refuses to pay the fee, can those enforcement powers, which are to be
used for the collection of child maintenance, be used to collect the
unpaid fee? I suppose that a fee could be levied even in cases where
there is a nil maintenance
assessment.
Mr.
Boswell:
As we begin to tease out this
issue—subsection (1) makes it clear that it is about the
agency—I have it in mind that the agency may nevertheless be
required to pick up on private arrangements in which maintenance is not
being paid. The question is whether it can charge fees retrospectively,
as if were, on that portion of unpaid maintenance that was missed
before it became directly
involved?
Danny
Alexander:
I hope that the Minister will explicitly rule
out the circumstance described by the hon. Gentleman, as I am sure that
it would be against the Government’s intentions as set out by
the Minister. I am trying to understand whether the provision would
allow the enforcement powers to be used to collect fees when no
maintenance was being collected through the enforcement
process.
Mr.
Harper:
I want to make a brief point about the welcome
intention that the Minister outlined when introducing the amendment.
The amendment refers to the fact that the regulations to be used to
collect fees shall apply equally, with any necessary modification. I
listened carefully to what the Minister said about not
using the enforcement mechanisms disproportionately to collect fees, so
the use of the phrase “shall apply equally” seems to me
to state the opposite intention. Given that that will be in the Bill,
and the Minister’s comments will not, I wonder whether a
different wording might be more
satisfactory.
Mr.
Plaskitt:
I shall reply briefly to the points that have
been made. The hon. Member for Daventry is seeking to extend the
policing powers of the commission into private agreements. That is not
what we intend to do. The answer to his question is that fees will not
be levied in respect of private cases.
The hon. Member for Inverness,
Nairn, Badenoch and Strathspey wanted to know whether enforcement
powers could be applied just to fees. No, they could not.
The hon. Member for Forest of
Dean wonders why the phrase “shall apply equally” is
included. It is to ensure that the legal basis for taking action to
pursue maintenance, is also available to pursue fees. Of course, it is
restricted in terms of the powers that will be used in the way that I
have clarified.
I
hope, with those reassurances, that the Committee will accept the
amendment.
Amendment
agreed
to.
Clause 6,
as amended, ordered to stand part of the
Bill.
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