Mr.
Watson: I have a couple of observations to make and I seek
one reassurance from the Minister. However, before I do that, let me
reassure my hon. Friend the Member for Gateshead, East and Washington,
West that I support the measure, which obviously has cross-party
support. First,
how satisfied is the Minister that there has been full consultation on
the measure? Does she feel that all the representative groups have been
consulted, and what are they saying about it? Some of the pressure
groups in this area have great passions, and it is important that they
have been able to express their views.
Secondly,
what observations has she made about the law of unintended
consequences? Does she know of areas such as those in my patch where 40
per cent. of the neighbourhood operates a cash economy without the use
of electronic banking? Has she got any evidence to show that the
provision might drive people out of the banking sector into a cash
economy? Thirdly—this
is an observation, but I hope she takes it seriously—these
charges are staggeringly expensive for an electronic transfer. Banks do
not need to charge £25 or £55 to move money between
accounts. Our officials should renegotiate
that. Fourthly,
I seek one reassurance, which I hope the Minister can give me. Let us
be honest, the CSA is occasionally totally hopeless. I have the
greatest respect for the people who work in that sector, but they do
get it wrong. Occasionally, they are belligerent, they dig in, and they
make the lives of our constituents a misery. When they do that, our
constituents come to our surgeries, we write to the Department, and
some minor ranking official writes back with a brush-off letter. Will
the Minister reassure me that if a constituent complains to me about
the order and I write to a Minister—as other hon. Members may
also do—that a Minister will write back, not a middle ranking
official? 11.2
am
Helen
Goodman: I begin by thanking all hon. Members who have
taken part in the debate for the constructive approach they have taken
and the pertinent questions they have asked.
First, I
shall address the points made by the hon. Member for South-West
Bedfordshire. I am grateful for the Opposition’s support. No
doubt all the Committee will be pleased to know that we anticipate
that, taken together, all the measures—not just those before the
Committee today—in the 2008 Act, which will be implemented by
April 2010, will lift some 100,000 children out of poverty. Together,
those measures are very significant. It is not just a question of
justice; it is also about making significant progress towards our
shared child poverty
objectives. The
hon. Gentleman asked a number of detailed points. His first question
was what happens if the non-resident parent thinks—possibly
wrongly—that they
have no obligation to pay. In fact, that could not happen through a
telephone conversation because if people have no liability, they will
be informed of that in writing. If arrears are outstanding, the
non-resident parent will have the opportunity to negotiate repayment of
the debt. The orders are very much a last resort
measure. Several
hon. Members asked about joint accounts and whether the ability of the
non-resident parent to set up joint accounts with a new
partner represents a significant loophole. The hon. Gentleman and the
hon. Member for Rochdale are absolutely right: that is clearly a risk.
We will take that matter into account as we evaluate the new process.
As the hon. Member for South-West Bedfordshire also said, the provision
is a significant step. It seems sensible to take this step first, see
how it works and then move on to dealing with joint accounts. We have
not decided how we will inform the House of the evaluation at this
juncture, but hon. Members can rest assured that I am alert to the
matter and if it can be dealt with expeditiously, it certainly
will
be. The
third point the hon. Gentleman raised was the possibility of
non-resident parents converting their money into cash. At the moment
the commission cannot estimate the likelihood of non-resident parents
converting funds into cash. They will monitor the effectiveness of this
policy and that is another of the loopholes that we will be examining.
This point is connected to that raised by my hon. Friend the Member for
West Bromwich, East. We will never be able to close all the loopholes,
but we will consider what we can do to limit the
risks. All
hon. Members who have spoken have raised the question of the
reasonableness of the charges. The charges made on the regular
deduction orders will be £10. At an earlier stage in the
discussion with the banks and building societies there was some
consideration of £25, which, unfortunately, is why it has crept
into the impact assessment. The reason for this is that the process
cannot be computerised. It has to be undertaken manually on every
occasion as it is constrained by the limit on the proportion of the
non-resident parent’s income and the need not to push the bank
account into overdraft. That has to be checked every time and that is
the reason for the costs. In the evaluation, once the banks and
building societies are used to running this process, we can look at
whether they will be able to reduce the
costs. Obviously,
this route is a last resort. The commission would much prefer
non-resident parents to pay by direct debit, cheque or standing order,
none of which attracts this level of charge. In effect the non-resident
parents are making a rod for their own back when they resist paying
through other, cheaper means. The £55 charge applies only to the
lump-sum
deductions. The
hon. Gentleman asked who was in charge of this policy. I am the junior
Minister with responsibility for this policy and I look forward to the
many items of correspondence that I will receive on this from my
colleagues across the House—of course, I report to the Secretary
of State on
this. The
hon. Gentleman also asked about the minimum amount of the deduction
order that can be made under these regulations. Under a lump-sum
deduction order, a deduction must not be made where the amount in the
account is less than £55 plus the amount to be deducted
towards the deposit-taker’s administrative costs. In the case of
regular deduction orders, the minimum amount is dependent on the
frequency of the deductions. Where the deduction period is monthly, the
minimum amount is £40 plus administrative costs; where it is
weekly, the minimum amount is £10 plus administrative costs. If
the minimum amount that can be deducted is less than the amount in the
account, no deduction will be made. The hon.
Gentleman asked whether these regulations apply to deductions from
third-party accounts. They do not; we will be introducing further
regulations to cover
that. Finally,
the hon. Gentleman asked how the commission will decided whether a
deduction order is appropriate—a point also raised by the hon.
Member for Rochdale. The primary legislation provides that a deduction
order may be made only where there has been a failure to pay child
maintenance. The measure will be used only when non-resident parents
are clearly failing to meet their responsibilities, and after attempts
to make appropriate alternative payment arrangements have failed. One
of the things officials need to learn to do is make good assessments.
The relatively high administrative costs are because officials are in a
learning process, and will be examining which cases they think are most
likely to produce results if we go down this path.
The hon.
Member for Rochdale also asked what happens in the event that a
non-resident parent goes into business with a new partner. That is not
a scenario that is envisaged in these regulations. It is precisely the
sort of thing we need to look at. We need to take account of whether
that is how people behave when we bring forward our evaluation and were
we to introduce regulations covering joint accounts. He also asked why
the implementation date is August. That is to speed up the
implementation of these regulations, rather than waiting for the
regular date later in the year.
My hon.
Friend the Member for West Bromwich, East asked about the consultations
that have been undertaken in preparation for these regulations. The
2006 White Paper was widely consulted on, and throughout the passage of
the Child Maintenance and Other Payments Bill, there were considerable
discussions about the details of the schemes which are now being set
up. The regulations and mode of operating have been discussed in detail
and this is ongoing with the banks and building societies. Their part
in this is critical to its success, and the efficient and effective
administration of it. When we bring forward further regulations we will
consult on them and publish the evaluation so that all stakeholders
have an opportunity to
comment. My
hon. Friend said that on occasion, CMEC is not the most efficiently
administered organisation, even though the hon. Member for South-West
Bedfordshire had previously complimented the officials in the
Department on the excellent way in which they had prepared the papers
for today’s debate. I hope we are seeing an improvement in
administrative quality. In recent years, that has been notoriously
problematic. Although this is the first time I have
spoken—
Mr.
Watson: I think I got the assurance that if a Member
writes to a Minister with their concerns about the operation of this
scheme, they would get a ministerial letter
back.
Helen
Goodman: I was just about to say that I will endeavour to
ensure that is the case. However, I am not so inexperienced that,
without knowing the level of correspondence, I would be prepared in all
cases—whether simple or complex—to commit to involving
officials in responding to
correspondence.
Mr.
Watson: I am not suggesting that the Minister write her
own correspondence or do her own research. I am sure that her officials
would draft that for her. It is a responsibility of Ministers—if
they are making these changes—to respect Members of Parliament
who raise important points with them. I do not think I am being
unreasonable to press the Minister a third time on this. I would just
like her to commit to a Minister responding to a Back Bencher who
raises points about the
scheme.
Helen
Goodman: My hon. Friend is so persistent and persuasive
that I am convinced it is the path we should take. With your
permission, I would like to commend this statutory instrument to the
Committee. Question
put and agreed to.
Resolved,
That the
Committee has considered the draft Child Support Collection and
Enforcement (Deduction Orders) Amendment Regulations
2009.
11.15
am Committee
rose.
| 
