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Baroness Hollis of Heigham: My Lords, we are not taking into account either the income of the parent with care nor the income of the non-resident father's new partner. Forgive me if I use these gendered words; 95 per cent. of lone parents are women, but the whole scheme is gender neutral.

The reason we do not take that income into account is that the child living with the parent with care enjoys the living standards of that parent with care. For example, if the parent with care can afford a larger house, the child enjoys it; if the parent with care can afford generous holidays, the child enjoys them; if the parent with care drives a larger car, the child enjoys it. Second children in the second family enjoy the living standard of the non-resident father; equally, the children of the first family enjoy the living standard of the parent with care. Whatever the mother's income and whatever the father's, he maintains a responsibility for his children. The marriage may end but his family responsibilities continue.

Lord Goodhart: My Lords, I wish to take up one technical but rather important point. I refer to the question of how far the Government have taken into account the interface between the assessment of fathers and the poverty trap. Page 26 of the Green Paper states:

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That started the alarm bells ringing with me because as a father's income goes up he will lose housing benefit, which is not assessable, and it will be replaced with earned income, which is assessable. In that situation it seems to me that there is a serious risk that there will be a poverty trap and that the father will be worse off as his income rises. I have not checked whether that is equally true in other situations, but it worries me greatly. This should be looked at carefully because it seems to be a case where, as is all too common, simplicity and fairness may well be in conflict with each other.

Baroness Hollis of Heigham: My Lords, there is a real issue of the poverty trap in all benefits that are tapered. I think we all accept that. It is clear that from earnings of about £200 a week the father is increasingly likely to be off housing benefit. However, on benefit fully, or up to £100 a week where he is paying only the £5 per week, that figure is low enough not to affect his entitlement to housing benefit, and so the poverty trap does not exist.

There is an issue of the income scale between £100 and £200 a week. However, the reason we do not go into this in detail in the Green Paper--we have obviously discussed this at some length--is that housing benefit is currently being reviewed. Secondly, we are reviewing the whole of the New Deal. Thirdly, we are reviewing the working families tax credit, which will overtake family credit. Fourthly, the minimum wage will be coming through. The working families tax credit will have a different taper--not 70 per cent. but 40 per cent. The result is that over the next two years there will be a good many changes in three or four of the different interlocking benefits which affect that income group. By the time it comes to drafting the Bill and the regulations we will have a much clearer idea of where, if anywhere, this bites unreasonably. But that is why, at the moment, it remains relatively open. We are not yet sure how possible changes in housing benefit--no such decisions have been made--the impact of the working families tax credit, the minimum wage and some of the New Deal proposals will interlock to affect that group.

Lord Milverton: My Lords, it was pleasing to hear what the Minister said and I liked the emphasis on children. That is important. The previous system was far too obscure and complicated. If this brings, as I am sure it could with all parties working together, fairness, decency and comprehensiveness, I am sure it will benefit families and children. The fathers should have time to see their children and have a say about them. But they should realise that they have a moral and ethical responsibility in the way of finance. The father's access is another matter because there are sometimes occasions when, even with his responsibilities, it is perhaps not wise for him to have contact. However, what is

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proposed is good and I hope that it will be done thoroughly and well, as I am sure it will be, the Minister being who she is.

Lord Stoddart of Swindon: My Lords, I was waiting for the Minister to answer.

Baroness Hollis of Heigham: My Lords, as it was a compliment, I thought it was more decorous to say nothing.

Lord Stoddart of Swindon: My Lords, I see. I congratulate my noble friend on repeating the Statement made in another place. It is certainly a good Statement. The Government have done their best to deal with a situation which was none of their making. Like the noble Earl, Lord Russell, I shall say only once, "We told you so". Nevertheless, I would add that we predicted at that time that the Child Support Agency would be another poll tax. We were wrong. It was far worse than the poll tax, as so many people have found out to their cost; indeed, in some cases, the cost of their lives. If I sound bitter about that, it is because I am bitter. I am bitter that we introduced such a system which drove some men to take their own lives because of the impositions on them by the Child Support Agency.

I should like to ask my noble friend one or two questions. I return to the question of access because it is an important question. Often one of the reasons why men do not pay their maintenance is that, despite court orders, they are refused access to their children, with whom they want to continue to associate and towards whom they would be very happy to pay maintenance. They often use refusal of access by the mother as a reason not to pay maintenance. I thought that something was going to be done about that.

Secondly, the workload of the agency will presumably fall considerably and therefore the system will be less costly. Will the Government give serious consideration to returning the whole question to the magistrates' courts? I know that my noble friend criticised the magistrates' courts and their previous lack of ability to collect the maintenance. But that was because of lack of resources which the then government poured into the agency without any good results. I hope my noble friend will reconsider the position.

Finally, with regard to the £10 net benefit--at least I understand that it will be a net benefit and that there will be some benefit from the maintenance that will not all go back to the Government--has she considered whether £10 might be a little low? Can she also say whether there are plans to increase the £10 year-by-year, in accordance with the cost of living or the wages index, or a mixture of both?

Baroness Hollis of Heigham: My Lords, I am grateful to my noble friend for his welcome to and support of the Statement. He began by saying that the CSA had been another poll tax. This will be a different body, working a different system in a different way. I believe that we are giving the staff who will be

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delivering the system the best possible opportunity to deliver something that is seen as fair, balanced, decent and workable.

My noble friend referred to access and to women refusing access despite court orders. I am sad to say that my noble friend is correct. Some research shows that 40 per cent. of parents with care admitted to thwarting an access order, often, although not invariably, because they are in a new relationship and wish to have a clean break from the father. What we are trying to say throughout all of this is that they can divorce each other but not their children. As a result, the father's right to have contact with that child unless the court has said otherwise is something that we should all seek to uphold. Obviously, the courts will be scrupulous where there is any risk of violence or damage to the children and none of us would wish for anything different. The fact that so far 70 per cent. of parents with care have been refusing to co-operate with the agency, nominally alleging "good cause", suggests that things other than a fear of violence are going on.

There is a dilemma as regards the latest announcement by the Lord Chancellor concerning the proposals for parental rights to go alongside the name on the birth certificate. If one wishes to buttress marriage at the expense of all other relationships, one may regard that as undesirable. However, if one wishes to encourage fathers to take on their responsibilities and to share in the upbringing of their children, one has to treat them as though they were married parents in all but legal name. There is a dilemma here and your Lordships will accept it. If we downgrade the rights of former cohabiting fathers, the children will suffer in terms of the attention they receive from their fathers in future. That is why my noble and learned friend the Lord Chancellor is seeking to extend parental rights to fathers who are cohabiting. I hope that that will ensure, where there is no risk of violence or threat of it, that the father will go on to enjoy some of the rights that divorced fathers have. It is quite remarkable that at the moment men who are most willing to pay also pay the highest amounts of money. That is because they are divorced fathers who have access and where there has been higher engagement in their children's lives.

I was asked whether we were thinking of returning to the magistrates' court. The whole thrust of this paper is for a simple formula. We believe that lone parents were let down by a system that was random, uneven and costly. As regards the maintenance disregard at £10 being higher, I do not doubt that there will be an on-going debate with the Treasury on that subject in future years.

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