Select Committee on Work and Pensions Minutes of Evidence

Examination of Witnesses (Questions 60-79)


17 JANUARY 2007

  Q60  Justine Greening: What you have just said in many respects might support having them separate. So people working in the existing organisation should stay there and work with that existing client base and sort that out. Then, perhaps, the new organisation could focus on new cases. But then, actually, there is a danger, certainly to my mind, you are absolutely right, that that will be one of the problems, because people working in the CSA at the moment will now be in the C-MEC organisation and that will be yet more change and a new system that they may be involved in administrating. Do you think maybe that is a reason why we could have had a clean break approach?

  Ms Maclean: I think the CSA staff are actually vastly underrated. I think there has been an enormous amount of change over the least year or so. I think there are some very able people there whose expertise is of great value, and it would be important to value it and use it in this transition period.

  Professor McKay: I think this question of implementation is really important. I suspect, going back to what I was saying earlier, the words "clean break" were probably a bad choice in this area. "Clean break" got bad press in divorce—a bad choice of words. I think, against a clean break, if you think about the formation of the CSA back in the early 1990s, it was a brand new organisation, all new staff, having been trained from scratch, all new IT and that obviously did not work, and so you need some kind of plan for continuity, I think. I am probably more favourable to Henshaw's view that we need to somehow draw a line between the old and the new. In practice it is very difficult for a clean break, because as soon as someone applies for maintenance, say someone has split up for the second time and they have already got a CSA assessment from a previous partner, doing it in practice is very difficult. One of the reasons the new CSA system had problems was because all these cases had to be transferred because they were dealing with people who were on both systems. I think, in practice, it is very difficult to do that, but the question of how you implement this does need to be looked at in detail. It is reassuring that there is a reasonably long timetable to it, but I think it does need to be looked at pretty closely.

  Q61  Justine Greening: If you were making some recommendation about key areas that you need to be focused on to make sure that that transition is done smoothly, what would you say?

  Professor McKay: I think I would go with Mavis's point, that a lot of the existing staff, who were quite a battle-hardened group, do have a lot of expertise in dealing with the public, trying to get information out of people. People have got quite a lot of experience about that, so I can see people from the organisation being at the forefront of the new organisation. Beyond that, I do not have anything specific to recommend, but there is a lot of expertise there. You want to ensure you draw upon that whilst at the same time you want to make a break with the past, and it is a difficult one to achieve.

  Ms Kazimirski: I do think that the fact that there will be a different name, if there is a new government agency, and so on, in that way, there might be an impact on people's perceptions. The agency may start losing some of the stigma of inefficiency, and so on, if it does have that change. The down side, if you did leave the current cases behind, in a way, and did not change things for them, they would not get all the benefits that we are talking about of having a simpler system, the other improvements talked about such as the disregard for benefit cases. I do not think it would be very fair to leave those behind.

  Q62  Justine Greening: I think people in the existing CSA arrangements can apply to C-MEC, so nobody would be excluded from it. It sounds to me like what you are saying is that there is an aspect of it—which is how it is dealt with to the public—that is actually quite important, so making sure that the public know that this is a fresh organisation, if you like, with the experience of the old one. Would you say that is a fair comment, that that is quite an important thing for the Government to look at?

  Ms Kazimirski: I would say it is, yes. Even if all the cases were able to apply to the new agency, I would have thought it might be simpler to assume a complete transition, just because that might be easier than actually dealing with separate applications. I think, in order to make it simpler, there is a suggestion that parents on the older system can avoid a new assessment. It sounded like that was suggested for there to be less work for staff to deal with, but I am not sure that would be the case really. To re-evaluate, for there to be an active re-evaluation, it is a little bit like a new application really, so I think it would be simpler to avoid it.

  Professor McKay: Do we want a statement going out saying, "C-MEC, we used to be the CSA"? I imagine not. Or when talking to someone on the phone, "We are C-MEC." "What is that?" "We used to be the CSA." Is this the kind of image we want to be getting across? How is this going to be tackled?

  Q63  Justine Greening: You think that is something that needs to be seriously considered?

  Professor McKay: Yes. At the moment some staff are phoning people sensitive to the situation saying, "Hello, we are from the DWP", and then, when they get to the person through the receptionist, they say, "We are the CSA." If it is direct to C-MEC that is not looking quite so easy to do.

  Q64  Justine Greening: I think that is one of conundrums between doing a clean break and having C-MEC. C-MEC could be a very powerful way of saying to people, "No, this is a new approach and it is a better approach. We have ironed out some of the problems of the previous approach." On the other hand, if it is the same person they were talking to before and it is C-MEC, which used to be called the CSA, that sort of undermines that?

  Professor McKay: Yes.

  Q65  Justine Greening: I think you have hit upon a useful point for us in the inquiry. I think that is going to be quite a tricky thing to get over, and there may well be some benefits from having it under one roof and perhaps doing it that way. It is certainly not a black and white picture.

  Professor McKay: Sure.

  Q66  Justine Greening: What about the resource inside of it? You have alluded to the staff. Do you think that C-MEC needs to be resourced properly in a way that perhaps that the CSA was not? Is that going to be a challenge for us?

  Ms Maclean: Yes.

  Ms Kazimirski: I think one of the things to take into account is the fact that it feels at the moment like the number of people who will be happy to go on to a private arrangement has been overestimated. I am wondering whether the assumption that it is going to be more efficient in all these ways is based on the idea that there is going to be a smaller work load. I think it might be initially probably the opposite, because it is a transition and there will be a lot of new things to deal with. It might be the case that more investment is needed now to prove how efficient it all is and to then encourage people to go on to private arrangements so that fewer resources are needed in the future.

  Q67  Justine Greening: The current CSA has the operation improvement plan that has already been worked on to try to improve its performance in dealing with its client. How do you see that sitting alongside the introduction of the C-MEC organisational approach? Do you think those two things fit naturally or will they be running parallel but not really together?

  Ms Maclean: I cannot answer that. I hope they will. They will obviously have the same aims and a lot of shared skills, and hopefully they will work well together, but it is hard to say. I think we are all struggling. I have to remember to say "child maintenance" and not "child support". People say, "Is that different from child support?", and I say, "No." I do think the use of language is very important, as you suggest.

  Q68  Justine Greening: Is there anything further that you wish to add?

  Professor McKay: I think the lessons they are learning from enforcement and taking more action at an early stage is all useful, but I do not have anything particular on that, how one will flow into the other.

  Q69  Natascha Engel: The thing that I took out of our session with David Henshaw, even more than the concept of a clean break, was the complete shift in the way of doing things. He was saying that the problem with the CSA at the moment is the fact that we are asking an IT system to be so complicated that it deals with people's incredibly chaotic lives, which actually it cannot do, so there is no point in even attempting that because it is always going to fail. Actually need people to talk to people about their chaotic lives. I would, therefore, see it as very important to have a CSA completely distinct from a new organisation doing a completely new thing. That is where the concept of a clean break does come in and where it does become very important. Therefore, I would disagree with the idea that it is more about getting the nitty-gritty right. I think what he was talking about was a really massive shift away from the way that we do things now to the way that we should be doing things. Do you agree with that?

  Ms Maclean: I know that he is very concerned about telephones being answered immediately and pleasant offices—absolutely; I am all in favour of that—and reliance on IT, not in the past.

  Ms Kazimirski: It seems that all the staff from the CSA at the moment have never actually helped cope with the situation, and actually some CSA staff have helped parents. Face to face meetings are hard to get, but when they have been able to get them they have been very helpful. We have had a parent with care in our research who had a very difficult call with a member CSA staff, a difficult call because her situation was crying on the phone, and she was so touched by the CSA member of staff calling her back the next day. That level of personal empathy, I think, we should not be saying is not happening at all at the moment.

  Natascha Engel: In fact, he was saying exactly the opposite to that. We are asking CSA staff to deal with IT systems rather than dealing with people and that they should be dealing people to people rather than dealing with IT systems. He was actually praising the CSA staff.

  Q70  John Penrose: Since we are talking about transition, we know we have got the old system and the new system and we have had all the IT difficulties. You have said yourself that implementation is going to be absolutely key, and we are still, I think, waiting for a date upon which, in theory, the old system people can move onto the new system and now we are going to have the new, new system. So, my question is simple. I think that the Government is saying that in about 2010 or 2011 migration from both the old system and the new system will take place to the new, new system under C-MEC and they reckon it is going to take about three years. Given the complete failure to do that so far from the old system to the new system, is that achievable?

  Ms Maclean: I have no idea. One can only hope and pray, I think.

  Q71  John Penrose: That is a slim basis to build a large investment on. Does anybody else have any stronger views?

  Ms Kazimirski: My research is focused on the parents' point of view, not the CSA staff, and so I am unable to comment.

  Q72  John Penrose: Professor McKay, help us out?

  Professor McKay: No; I am sorry.

  Q73  John Penrose: Is there anybody who can tell us?

  Ms Maclean: You need organisation sociologists and business people. I wish I could help you, but I cannot.

  Q74  John Penrose: That is a resounding maybe. Thank you very much.

  Professor McKay: The problems with IT have not typically been around doing the actual assessments, and not actually doing the sums has not been the problem, it is much more the linking of addresses with phone numbers. It has been a major IT failure, but there are bits of the IT that do work as they are supposed to. We have all learned. The date of the change over is when it is ready and when it is ready is—

  John Penrose: I am kind of concerned there, because that is an essential plank of getting this new system right, and if nobody can stand up and say, yes, it is going to happen, that is really very important.

  Chairman: There is nobody here. We need to find somebody.

  Q75  Harry Cohen: Can I ask you if you think the Government is right to sell off the debt to private collection (bailiffs really) and what you think the implications are for low-income families generally?

  Ms Maclean: I am not uncomfortable with it. I think the Government needs to learn from the skills and expertise of private debt collectors in terms of locating people and determining their assets and so on, but I think you have to be quite careful about there being some element of somebody making a profit out of collecting this money. I think that could be very unfortunate. Also, you would have to be careful about gentle treatment of some very troubled people.

  Q76  Harry Cohen: I am not sure whether I should ask you, but I will anyway. Do you think there should be safeguards in there?

  Ms Maclean: Very much so. We have had the CSA suicide stories in the past, and we really do not want any more of that kind of issue.

  Professor McKay: By their nature the bailiff collection route is going to be for the middling sums; it is not going to be for the really large sums. If you have got tens of thousands of debts, you are not the kind of debt that would go to the bailiffs, for instance, although that is one they would clearly like to go after, I think. The bailiffs are likely to be much more involved in the high hundreds low thousands route, which is likely to be a low-income, relatively vulnerable group. On the other hand, there is this huge debt owed to the state. Would you like some of it or none of it? We could get some of it reclaimed.

  Q77  Harry Cohen: I am fascinated. To follow that on, what happens to the really high debt? Is that not collected by the bailiffs? Presumably that would stay with the CSA or C-MEC or whatever, or it would just be written off?

  Professor McKay: Coming back to my earlier point, the problem with the clean break is that you end up with this kind of CSA residuary body, which must become one of the most depressing places to work, a finite lifespan and having to chase all these `unchasables'. Clearly, the really high debts are the cases where you want to be getting into charging orders and third-party charging on bank accounts. There are ways to deal with really large debts, but it is highly specialised.

  Q78  Harry Cohen: So it will balance out sooner or later.

  Professor McKay: For the really high debts, I suspect, you would not want to go down the bailiff route, you would want to go down to property charges and these kinds of areas.

  Ms Maclean: You have to distinguish between "cannot pay" and "will not pay" and the very early debts of the CSA, which were to do with interim assessments, emergency tax code, like an operating in a fairly artificial way. That is the part of the debt which Sir David wanted to write-off. I think there are very different forms of debt hidden within this blanket term. That is why we need the expertise of the private sector to help us with working out which approach would work for which kind of debt. I think there are some debts which are almost artificial, and there may be huge numbers of zeros attached to them but they are historic and really the construct of the system rather than individuals being recalcitrant.

  Q79  Harry Cohen: Following on from that point, the organisation resolution in their submission to us said how will the bailiffs being brought in be applied? Will the decision be made in those cases where the arrears are the highest or where enforcement is deemed to be the most difficult? I was particularly concerned that the debts would be sold off where the underlying calculation could been incorrect, no doubt (presumably, unfair as well), like the new system, when it was the new system, came in when a lot of people who should have been applied to that were left paying a lot more, and they might think it was very unfair, so the debt was much higher. That is a very real point which, presumably, you would agree with?

  Professor McKay: The CSA have always said one of their problems is that there is no easy way for them to go through and identify people with really big debts. There is no automatic identification of them. It seems a very strange way to work, not to be able to identify where the biggest debts are. Also, once you get into using bailiffs, you are getting a lot of the original debts down to these things called "interim maintenance assessments", which were used back in the 1990s, where a very high level of income was assumed, which probably should have been changed, plus earning some fees added on top as well. If it goes down the bailiff route, people face the prospect of having £50 to £100 added to the bill just because the bailiffs have knocked on the door. I do not think that would be helpful. A lot of the debts from the early mid-1990s are essentially artificial and the White Paper looks at ways of dealing with that.

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