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Earl Russell: My Lords, does the noble Lord remember the Education (Student Loans) Bill 1990? I believe that if he checks the precedent, he will find that his argument is mistaken.

Lord McIntosh of Haringey: My Lords, there are a number of precedents for reasoned amendments and, generally speaking, they do not encourage us to think either that we can win reasoned amendments at Second Reading or indeed that, even were we to win them, it would make any difference to the subsequent passage of the Bill. But that is a tactical argument rather than an argument of principle which I make to the noble and learned Lord.

One comment that I would like to make is about the noble and learned Lord's second point on the rule of law. I cannot agree with him that there is anything new about the provision that civil servants in the Child Support Agency shall make decisions about people's lives. That happens all the time. Indeed, the noble and learned Lord

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himself voted with the Government in a Division on an amendment to the Jobseekers Bill which sought to overcome the principle that jobseekers could be deprived of their benefit while the case was being heard by the appropriate officials. I found that a surprising judgment on his part, on a much more serious issue than the issues raised by this Bill. So, although I have much sympathy with what he says, I find it impossible to recommend my noble friends to support him in a Division, should he call one. He has made valuable points and the House should be grateful for them.

Similarly, there is the position of the Liberal Democrats. I listened to the speech of the noble Earl, Lord Russell, who said in terms that his party rejects lock, stock and barrel the Child Support Act of 1991. The noble Earl rejects that Act because he rejects a formula. What does that mean? It means that we return to the courts—very largely to the magistrates' courts and perhaps to a unified family court. That would be very valuable for all kinds of other reasons but it does not solve the problems which led to the introduction of the Child Support Act in the first place.

If these matters are left to the courts, there will be huge variations in different parts of the country. The chance of a single mother obtaining a decent settlement will depend on the judgment of local magistrates rather than on an attempt—only an attempt and it is a difficult thing to do—to find a formula on which to operate. The balance of a formula with departures, which is the appeals procedure now proposed in the Bill, may not be perfect and may never be perfect, but it is better than relying on the courts and magistrates alone. The noble Baroness, Lady Faithfull, made that point very effectively when she said, perhaps sadly, that we cannot go back to the original system. That time has passed.

That does not mean that there is not very much more still to be done. The Child Support Agency has had enormous difficulties, partly—I believe largely—for the reason given by my noble friend Lady Hollis; namely, that the original Act was retrospective. That led immediately to a huge backlog and huge delays. But the difficulties also arose because insensitive performance targets were set for the agency by Ministers. If performance targets were set, they were rather low targets which have not been achieved. But, if the agency is set targets which depend, for example, on the amount of money collected from absent fathers and there are no further qualitative targets, then inevitably the agency will try to get more money from the absent parents whom it knows and with whom it already has contact rather than look for the ones it does not know.

It is rather like the drunk who is found looking for his keys underneath the lamp post. A passer-by asks him, "Did you lose your keys here?" and he replies, "No, I didn't lose my keys here but the light is better here to look for them." That is exactly what has been happening with insensitive ministerial directions. The figure given by my noble friend of 86 per cent. incorrect assessments is absolutely horrifying. The suggestion in the targets for the CSA that it should be looking for only 75 per cent. correct assessments seems to me to be even more horrifying.

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We have to say that the package of Bill plus regulation, which is before Parliament and which has been the policy of the Government, benefits the absent parent and particularly the absent parent in better-off conditions rather than the parent with care or the children. The benefit to the absent parent appears in the regulations; the improvements appear in this Bill. That is why we do not propose to vote against the Second Reading and why our approach to the Committee stage of the Bill will be constructive. We do not indulge in trench warfare, as I am sure the Minister will agree.

However, we must somehow ensure that what comes out of this legislation is benefit for children rather than benefit for the Treasury. Of the many lines of amendment about which my noble friend has given notice the most important is the issue of maintenance disregard. It is essential to make sure that a certain amount of the money that is obtained from the absent parent does not just go to the Treasury by being offset by a reduction in benefit but that it goes to the quality of life and the resources of the parent with care and the children. I believe that if we could achieve that—it does not have to entail enormous amounts of money—we should overcome some of the problems of the resistance of absent parents to making payments and some of the difficulties which the hard pressed staff of the Child Support Agency have experienced.

This is not a bad Bill. It is not as good a Bill as it should be. It does not address many of the problems that still exist. Perhaps they cannot be addressed simply in the context of the problem of child support. Perhaps the social policy issues are very much wider. But it is a Bill which deserves your Lordships' attention. It deserves careful consideration in Committee and on Report. I hope that the House will give it that attention.

5.17 p.m.

Lord Mackay of Ardbrecknish: My Lords, we have had an interesting debate. It has been a little shorter than the normal run of Second Reading debates in which I have participated in this Session. It is nonetheless welcome for that. As the noble Lord, Lord McIntosh, said, although the debate has been short and had a limited number of speakers, it has certainly been interesting and has effectively covered the field.

My noble friend Lady Faithfull indicated, perhaps in an attempt to throw a lifebelt in my general direction, that somehow she did not hold me responsible because I had not been involved in the 1991 Bill. I cannot even remember whether I had arrived in your Lordships' House at that time and therefore whether I had voted on that Bill. I may check on that point before we come to Committee.

The noble Earl, Lord Russell, who has been present at all my previous performances at the Dispatch Box on legislation this year, discussed the matter of my hat trick, which occurred one day when I had three Bills up in the air, so to speak, at the same time. I am happy to say that one of them is now safely down from the air and at the other end. I am now dealing with only two Bills.

I am grateful to the noble Lord, Lord Houghton, for remembering my maiden speech and the influence that it obviously had. He was very charitable in not reminding

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the House of some of my other speeches in response to his Bills to amend various dogs Acts. I am grateful to him for that. Perhaps he has a less charitable view of me on the subject of dogs than of whisky.

The debate showed that there were differences between the Government, myself and other noble Lords. But it also showed that there were considerable differences between some of the other noble Lords who spoke. Clearly, the official Opposition, as we heard from the noble Lord, Lord McIntosh of Haringey, and the noble Baroness, Lady Hollis of Heigham, understand, appreciate and wish to deal with the problem of absent parents paying their contribution to the maintenance of the children for whom they have responsibility. I am not sure that that is entirely agreed everywhere. I read the speeches in the other place at Third Reading and have to say to the noble Lord, Lord Houghton of Sowerby, that we have had significant Bill-do-now-pass speeches in the last two Bills in which I have been involved. The noble Baroness, Lady Hollis, made substantial speeches pointing out the error of my ways. I made substantial speeches at Third Reading pointing out why I was right. The noble Baroness is saying that she is waiting for repentance; she will have to wait for a long time.

In the other place the Opposition and the Government were accused by Mrs. Liz Lynne, the Liberal Democrat spokesman, of being in collusion on this matter. I do not believe that we are in collusion. But we are in agreement with the widespread and continuing support for the underlying principles of child support: that a parent should be responsible for supporting his child when he can afford to do so.

I was chided by someone for not dealing with the problems that have occurred with the agency since the Bill became an Act. However, I thought I had. Clearly, it has not been easy to translate that expression of support into practice. Reversing a culture where all too often the taxpayer took care of the bill was never likely to be easy. There has been resistance to the move away from the court system despite the inconsistent and unpredictable results with low awards of maintenance for children which that system produced. We now accept that we have gained some experience in the difficult business of running a child support system, and I hope that the House recognises that we have not been intransigent. We are working to restore the balance. We have undertaken a review of both the policy and the workings of the agency. We welcomed the helpful advice; we listened and acted. Indeed, we have gone further than the recommendations of the Social Security Select Committee and that is evidence of our commitment to get it right. The changes introduced in April are already producing tangible results for many absent parents; and those, together with the changes contained in this Bill, will improve the way in which maintenance is assessed, collected and enforced.

Perhaps I can deal with a number of the issues raised. There were a fair number, and I shall try to do as many as I can without trying the patience of your Lordships too long. On the question of maintenance disregard, to which the noble Baroness, Lady Hollis, and her noble friend Lord McIntosh of Haringey referred—I have no doubt we shall return to this issue—experience has shown that the best way of helping families to improve their standard of

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living is to ease the move from benefit dependence into work. Surveys of lone parents, and indeed some of the debates we have had in this House, show that the majority want to return to work, and there is no great disagreement between us on that.

Where there may be disagreement is that we believe that the £15 maintenance disregard within the in-work benefits—family credit, disability working allowance, housing benefit and council tax benefit—is a better way of providing help to parents with care to help themselves and their children rather than a disregard in income support. The Bill contains the provision I mentioned which will further improve work incentives—that is, the proposed maintenance bonus which is worth up to £1,000. That will give a boost for a parent with care when that parent moves into work. An income support disregard would make it more difficult for a parent with care to earn enough to make her better off in work than on benefit. It would increase her dependency on benefit rather than reduce it. Noble Lords will not be surprised when I say that we estimate that the long-run cost of a £5 per week disregard in all cases would be around £110 million a year. The proposed maintenance bonus is a more imaginative and effective use of resources.

The noble Earl, Lord Russell, asked, as did the noble Baroness, Lady Hollis, about the number of appeals and the number of departures. The noble Earl asked also why I thought we would have departures in only a small minority of cases. As I explained in my initial speech, the standard formula approach is needed to achieve consistent results in the majority of cases and the departure should only come into play in exceptional circumstances.

On the Australian experience, which has been prayed in aid on a number of occasions, in only 7 per cent. of Australian child maintenance cases is there an application for a departure. The Australian system is very different from the UK system. For example, the assessment is made on the basis of taxable income for the year before last; a broad percentage of gross income is taken for child support and there is no protected income to avoid hardship as there is in our system. There are various reasons therefore, which do not apply here, why Australian absent parents and parents with care may ask for departure. It would not be wise to try to extrapolate their experience in order to make estimates. Our own experience in social security is that appeal rates in general are under 2 per cent. However, for estimating purposes we assumed that applications for departures may well run closer to 6 per cent. or 7 per cent.

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