Select Committee on Work and Pensions Written Evidence

Memorandum submitted by One Parent Families


    —    We welcome the proposal to allow parents the choice whether to use the agency or not. But those parents who do need to use the agency must be able to access it quickly and be sure that it will back them up. Provision of advice and information will be essential to making private agreements work.

    —    We are pleased that the Child Maintenance Premium will be extended to "old scheme cases" and that the child maintenance disregard is to be "substantially increased", but we are disappointed that this increase is not proposed until 2010-11. This means that the important contribution that maintenance could make to meeting the 2010 child poverty targets will be minimised.

    —    We are not convinced of the case for compulsory joint registration of births and would prefer to see a voluntary approach.

    —    We welcome a greater focus on enforcement for the new agency. To date this has not been a priority and organisational transformation will be required if this focus is to be achieved. A tailored approach to enforcement will be required to avoid labelling all non-resident parents who use the agency as "dead beat dads" and thus deterring engagement by both parents.

    —    We recognise that some child support debt will have to be written off. But plans to collect only 7% of the debt that the agency itself defines as recoverable are disappointing. The generation of children currently growing up without the maintenance owed to them must not be forgotten.

    —    The transfer from the "Child Support Agency" to the new "C-MEC" will need to be carefully managed.

    —    Basing maintenance assessments on available tax year information appears sensible, but we need further details of how this will work.

1.   One Parent Families

  One Parent Families is the national organisation representing the 1.9 million families in Britain headed by a lone parent. For almost 90 years, since it was established in 1918, the organisation has been campaigning for the establishment of a successful child maintenance system that guarantees regular payments to parents with care and their children.

2.   A new focus on parents making their own arrangements

  2.1  The Government argues that all parents should be given the choice to make their own child maintenance arrangements without the involvement of the Agency. It therefore intends to abolish the current rule that says that lone parents must apply to the CSA if they claim Income Support or Jobseeker's Allowance. This will happen from 2008.

  2.2  The new focus will be on encouraging parents to agree their own arrangements, with the help of new information and guidance services. The Government wants to consult on a package of services to support parents to make such agreements. These might include a national helpline for separating families, a register of private maintenance agreements, and a website. Parents seeking to use C-MEC would first be expected to use the information and guidance services. One "encouragement" to non-resident parents to reach acceptable private arrangements, will be the imposition of charges on the payer if C-MEC is used.

  2.3  We fully support the proposal that parents should have the choice whether to use the new Agency or not. But there are a significant number of lone parents who will not be able to agree maintenance arrangements which are adequate and reliable, or who find that their private agreements break down. In these cases they need to know that they can count on Government help, for example to trace the non-resident parent; to find out his/her true income; to make payment arrangements that stick; and to chase arrears. It is important that lone parents know they have the back-up of the new C-MEC and are not left to "go it alone".

  2.4  At present, the advice and information available to families on relationship breakdown is fragmented and inadequate. If the Government expects couples to make satisfactory arrangements for child maintenance on their own, it must put adequate resources into independent advice and mediation services to help them to do so.

3.   A £10 "maintenance disregard" for all lone parents on benefit—with more to come in 2010-11

  3.1  From the end of 2008, the Government intends to extend the rule which allows lone parents on Income Support to keep up to £10 of any maintenance paid, so that parents whose child support award dates from the old pre-2003 scheme are covered. It is estimated that 40,000 parents and 55,000 children could benefit from this change. The Government also promises that from 2010-11 it will "significantly increase" this £10 figure for all parents on benefit, so that much more of the maintenance paid by the non-resident parent actually reaches the children.

  3.2  Whilst very much welcoming the belated extension of the £10 "disregard" on child maintenance to old scheme cases, One Parent Families is disappointed that the Government has decided to delay giving children in the poorest families a larger share of any maintenance paid until 2010-11. Even the White Paper accepts that: "reclaiming most of the money for the State, rather than passing it through to children, still means that neither parent has a strong enough incentive to co-operate [in arranging maintenance]. This undermines the extent to which child maintenance can contribute to the eradication of child poverty." Given that the Government has a target to halve child poverty by 2010, we believe a "disregard" substantially in excess of £10 should be introduced much earlier. This would be an extremely well-targeted way of helping the Government to halve child poverty by 2010, lifting a total of up to 90,000 children out of poverty.

4.   Joint registration of births

  4.1  The Government intends to change the law in England, Wales and Northern Ireland so that, for unmarried as well as married parents, both parents' names will be required on the birth certificate. This is intended to give both parents a clear sense of responsibility for the welfare of their children. There will be safeguards to protect the welfare of children and vulnerable women.

  4.2  We argue that this measure is not necessary for child support purposes where use of the new Agency is voluntary, and will create enforcement difficulties for Registrars if the mother is unwilling to name the father. What punishment would be meted on unmarried mothers in this situation, and who will judge the issue of child welfare or vulnerability? We consider it would be far better to promote voluntary joint registration of births as part of a more general strategy of positive engagement with unmarried fathers about their responsibilities towards their children.

5.   Tougher enforcement

  5.1  The Government says it wants to consider new measures to ensure a "strong and effective enforcement regime" is in place.

  5.2  One Parent Families very much welcomes the determined thought being given to how to pursue more rigorously non-resident parents who seek to evade paying for their children. Until now, debt collection and enforcement has had a low priority within the CSA. Measures such as "naming and shaming" or taking away passports are eye-catching but apply to only a few cases, and could only be applied after all other measures had failed; we want to see an organisational transformation so that all non-payers are targeted at an early stage and any arrears systematically pursued. We would prefer an emphasis on ensuring that parents meet their responsibilities to their children, rather than on what will be done when the system fails to do so.

  5.3  Previous research indicates that non-resident parents dealing with the Agency resented being stigmatised as "dead-beat dads". There are a variety of circumstances where it is easier for both parents if payment of child maintenance is done through the Agency—for example, where there is a tense relationship and both parties need an intermediary to ensure proper maintenance is paid; where official oversight of payments made reduces the scope for dispute about whether payments have been made; or where the parents don't agree about the non-resident parent's financial circumstances. Too great a focus on the new Agency as dealing only with hard-core serial non-payers risks creating resentment among non-resident parents contacted by C-MEC, and may deter some parents with care seeking help. We suggest a tailored, risk-based approach to non-resident parents by C-MEC, based on their circumstances and past record.

6.   Dealing with long-standing debt

  6.1  Out of a total debt of £3.5 billion, the Government intends to write off around £50 million of "historic debt" which they can no longer recover. This will include:

    —    unpaid fees and interest which date back to 1993-95;

    —    cases where the parent with care or non-resident parent has died (and, in the case of a non-resident parent, the debt can not be recovered from his estate); and

    —    cases where the parents are reconciled or the parent with care does not want recovery.

  6.2  The Government also intends to revalue £1.3 billion's worth of punitive assessments (Interim Maintenance Assessments) levied between 1993 and 2003. This is because it accepts that the money, because not related to ability to pay, is irrecoverable. The revised value, based on actual liability, will be around £0.5 billion. Thus, £800 million of debt will disappear as a result.

  6.3  C-MEC will also be given the powers to:

    —    "do deals" on debts so that, if the parent with care agrees, a lesser amount than the entire debt can be paid in full and final settlement;

    —    factor (sell) debts (but if owed to the parent with care, only by agreement);

    —    recover arrears from the estate of a non-resident parent who has died; and

    —    offset new child maintenance liabilities, where a child moves between parents and there is an existing debt owing.

  6.4  One Parent Families accepts that there is a certain amount of debt which, however hard the CSA or C-MEC tries, is simply unrecoverable. But the Agency's own figures show there is around £1.4 billion of child support debt which is definitely collectable; yet the Agency has plans to collect only £100 million of this (a mere 7%) by 2009. This is disappointing. Moreover, the White Paper says very little about C-MEC's proposed "residuary function" of resolving historic debt beyond 2009, or the level of resources which will be devoted to this task. At present a generation of children are growing up without the child maintenance they are entitled to because the Agency failed to take debt collection seriously in the past. Although the White Paper promises a "clean break" from the past, the debt which is owed to those children must not be forgotten. We call for considerably more resources and effort to be devoted to recovering the £1.4 billion of collectable debt.

7.   The new Agency: C-MEC

  7.1  The Child Maintenance and Enforcement Commission (C-MEC) will start work in 2007-08. At first, it will simply take over existing cases and focus work on debt collection and effective enforcement. In the transition to the new scheme, it will brief parents with existing assessments so they can make one of three choices: (1) to be transferred to the new scheme with a simplified assessment; (2) to make their own arrangements; or (3) continue their existing assessment via a C-MEC organised "cash transfer service". The transfer of cases to the new scheme will be a gradual process, between 2010 and 2013. C-MEC is likely to contract out aspects of its business, such as debt collection, to private contractors.

  7.2  Despite operational improvements introduced by the current Chief Executive and his team, the CSA has a sorry history and its abolition will not be mourned. In reality, however, the CSA will gradually evolve into C-MEC with a smaller number of staff and, it appears, the same computer system. Will the new Commission do better? At present, a three-year plan to radically improve the performance is slowly having an effect. But many challenges lie ahead, not least the transfer of cases to the new scheme, and enabling parents on the existing schemes to make the right choices as to whether to transfer or not.

8.   A new assessment

  7.1  A new simpler assessment process will be introduced for cases dealt with under the future system, intended to speed up the process and prevent delaying tactics. It will:

    —    use latest available tax-year information from the Revenue to calculate child support, unless current income differs by at least 25%;

    —    make fixed term awards for a year, updated each year by tax data. In-year adjustments will only be allowed in a limited number of circumstances;

    —    base assessments on gross not net income, with new rates of 10, 15 or 20% where there are one, two or three or more qualifying children;

    —    no longer take into account tax credits paid to a non-resident parent as income; and

    —    charge non-resident parents on benefit £7 per week for child maintenance, not £5.

  The rules on applying for a variation will continue to apply.

  8.2  One Parent Families has argued that much closer integration was needed between the Agency and the Revenue so that tax information could be accessed more easily to ascertain non-resident parents' income. The decision to base assessments on available tax year information looks a good one; but careful study will be needed to ascertain how it will work in practice.

9.   Conclusion

  Lone parents have been told time-and-time again that reforms to child maintenance will deliver. It is absolutely vital not only that we get the system right now for future generations, but that those lone parents and their children who have lost out under the present scheme are not forgotten.

5 January 2007

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2007
Prepared 15 March 2007