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The noble Lord said: My Lords, it may be convenient to discuss with this my Amendments Nos. 33 to 46, as well as Amendment No. 47, tabled by the noble Earl, Lord Russell, and also included in the list, which appears much later in our proceedings than I had expected, given the initial grouping.
The amendments are about variations. It is common ground across the House that there is an overwhelming case for simplifying the Child Support Agency arrangements. However, the more simple one seeks to make the system, the more important become the variations, or departures, as they are also called. The amendments spell out various items that need to be considered. Our aim is to enable the House to take a view on whether each item is an appropriate one to take into account.
Amendment No. 36 would take account of relatives such as elderly parents and Amendment No. 37 relates to payment by the absent parent towards the education of children from the first or second marriage. The Bill says that the absent parent's income can be adjusted to take account of school fees, but only for boarding school education. No doubt the Minister will comment on that.
Another important issue is whether mortgage payments should be taken into account, even if the non-resident parent keeps a less than 50 per cent. interest in the matrimonial home. Expenses relating to handicapped children or debts incurred by the parents before the relationship broke up are other items that could be taken into account.
Our aim is to list the various circumstances that could be taken into account. Obviously, if they were all taken into account, we would almost be back where we started. Some of the possible items have greater merit than others. Debts incurred during the previous relationship and the situation with regard to the matrimonial home are two important examples.
At this stage, I am merely asking for the Minister's reaction to the various items that are specified. In the light of what she says, we shall consider whether we ought to return to the matter on Third Reading. I beg to move.
Earl Russell: My Lords, a good many years ago I had to attend a conference in the middle of Windsor Great Park. My host had obligingly provided me with a map, on which the route appeared to be easy to follow--it was a matter of first right and first left. After several hours driving round Windsor Great Park, I finally succeeded in arriving very late, very hungry and very irritated. I tackled my host about the map. He said, "Oh, but I left out all the turnings that you did not need to take for the sake of simplicity."
I have put my name to this group of amendments and tabled my own Amendment No. 47, which I understand to be consequential on Amendment No. 46, tabled by the noble Lord, Lord Higgins, which authorises the taking into account of any other circumstances. It is the proverbial "some other reason why".
Baroness Hollis of Heigham: I am sure that the noble Earl will confirm that on every occasion I have said that people should pay their taxes and their national insurance first and then pay their child support from the net income. There is no difference between us on that.
The other exception is expenditure that is necessary to earn the income out of which the maintenance shall be paid. Someone who cannot earn an income cannot pay maintenance. The Minister knows as well as I do that there were a considerable number of such cases under the 1991 Act. We hope that there may be slightly fewer under the Bill, because the level of maintenance has been set lower for everybody, regardless of whether they have special expenses, in the hope of covering any special expenses. Of course, that means less money for children in some cases where it would not have been necessary. But it will not necessarily cover the special expenses of those who have them. For example, some people who commute to work in London have to commute considerable distances. Their expenses are not necessarily on a level with those who walk to work.
Beyond that, there is the fact that circumstances may arise, as they have done since 1991, which no one now foresees. It is in the essence of the principle of the Bill that no variation may be prescribed unless it has already been set out in regulations. Anything which has not been foreseen by those who draft regulations cannot be responded to.
I am sure that the Minister remembers a case about which we corresponded. When we last heard, the facts were in dispute. But let us assume that they were as alleged, because in some cases, they could be. This was a woman, with a daughter, who had remarried. Her daughter eloped with her second husband, or so it was alleged. She felt a conscientious objection to paying maintenance in those circumstances.
Let us take the case of the man who made a large capital settlement on his wife. She remarried. Her husband invested in property bought at the peak of the boom in 1988 and then went bankrupt. The first husband was dunned a second time. I had a long correspondence about that with the Minister who was entirely sympathetic. But the legislation allowed no discretion. It was impossible to respond to the unforeseen circumstance. That simply is not the real world. If we do not delete that provision in Schedule 2, which says that nothing may be prescribed unless it is included in regulations, the Minister will find herself in Windsor Great Park without a map.
Baroness Hollis of Heigham: My Lords, the amendments which we discussed earlier surrounded the more technical aspects of variations. These amendments relate to the grounds on which a variation from the normal rules may be agreed. We discussed many of them in Committee so I am rather surprised that some of the amendments have been retabled. However, I am happy to try to respond to your Lordships' queries.
We are replacing a complex formula with a simple system of rates which will lead to a better, faster, fairer and more transparent support system. A calculation will be provided in which we recognise that every parent has different kinds of commitments. But the new rates will leave most with at least 75 per cent and on average more like 80 per cent--given that the average lone-parent family consists of under 1½ children--of their net income to meet those expenses.
But we recognise that there will always be cases where it is inappropriate to apply the normal rules without some flexibility. Therefore, it may be worth reminding your Lordships what we are seeking to do.
In other words, we are determined to keep a tight rein on the grounds on which that variation can be agreed. A shopping list of amendments has been suggested this evening--that is, to look at travel-to-work costs, housing costs, the costs of supporting elderly relatives, and other costs. It was said in the other place that,
What is the point? Why bother with reforms of the agency at all if all we are doing is displacing complexity from the entry, which is assessment, to an exit point, which is variation? Why bother? Why not stay with the existing complexity of the current scheme? That is what it would mean. Let us be in no doubt. If you take into account housing costs, you must also take into account travel-to-work costs. We shall be reinventing the present complexity. For example, there are 50 different mortgage systems. Every time the rate changes, all those calculations will need to be redone. As a result, delays, errors and arrears will creep into the system. Why bother? We would be chasing paper rather than chasing the parents who should be paying the maintenance.
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