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I was going on to explain why some of the limitations are in regulations and why we need to reflect on them in relation to lump sum deductions, particularly on business accounts. We are not
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The same considerations do not arise with the protections that you need when accessing other accounts for regular payments. We plan to continue the current kinds of constraints wherefor example, for deductions from earnings ordersyou cannot take more than 40 per cent of a persons net income. So there is a limit on what can be taken in any event. Obviously, it is more likely that that kind of constraint would be aligned with what routinely goes into a business account if it is reflective of income.
There are difficult issues around joint accounts, particularly in the kind of situation to which the noble Lord referred, where you have an NRP with a new partner and they have a joint account. Sometimes the past relationships and past obligations are not necessarily known and the extent to which the new partner would want to share resources in that joint account may raise some issues. When we get to those regulations we will need to think them through in some detail.
On deductions from earnings orders, it is not only the bank accounts where money is held that can be accessed; potentially, money held by accountants and solicitors on behalf of individuals can be accessed as well.
The noble Lord, Lord Kirkwood, asked which accounts might be excluded. These may include accounts such as trust funds where the non-resident parent is not entitled to the moneys held within the account. That is an example of the kind of account that might be excluded.
I am conscious that I have dealt with only some of the quite detailed points that have been raised. I should like to read the record and revert in more detail so that noble Lords are satisfied. Obviously what we are trying to do here is to add significantly to our powers of enforcement, particularly, following on from the point raised by my noble friend earlier, in view of how difficult it is in some circumstances to reach NRPs who will not pay.
Lord Skelmersdale: I am most grateful. As the Minister has not answered all the points and he will have to write to me, perhaps I may put a thought into his mind. As I understand the situation proposed, there is a leeway of seven days before the operation starts. In these days of electronic transfer of money and so on, there is a potential difficulty. The noble Lord is shaking his head. Have I got it wrong?
Lord McKenzie of Luton: There is a seven-day period somewhere in all of this but I think not where the noble Lord has identified. We need to revert on that to avoid any confusion.
Lord Skelmersdale: Heaven forbid. The noble Lord might have a sample of my handwriting and the letters might be reciprocal.
On Question, amendment agreed to.
The Chairman of Committees (Lord Brabazon of Tara): I should point out that if Amendment No. 112 is agreed to I shall not be able to call Amendment No. 113.
Lord McKenzie of Luton moved Amendment No. 112:
On Question, amendment agreed to.
[Amendment No. 113 not moved.]
Lord Skelmersdale moved Amendment No. 114:
The noble Lord said: This is by way of a slight parliamentary trick to allow me to say what I want to say, the first amendment in this group, Amendment No. 113, having been pre-empted. In moving Amendment No. 114, I shall speak also to Amendments Nos. 115 and 116, 119, 126, 135, 137, 140, 141, 145, 147, 149, 151, 155 and 158. All the amendments in this group enforce limits on the commission and narrow its broad parameters into what I hope are specifics. The need for such amendments suggests once again how the Government these days will shy away from including any detail on the face of legislation, thus allowing themselves a free rein when making secondary instrumentsnot for the first time during our proceedings on this Bill. I do rather object to that. A large number of these amendments are drafting amendments intended to define the proposals made in the Bill more strictly. Thus the account will become,
and third party becomes licensed deposit taker. In every case that I have used the phrase licensed deposit taker, I am not absolutely sure that that is what the words third party actually mean in the Bill. It is confusing to use the same word or phrase in totally different contexts. Precision is important because without it, room is created for error and confusion, which could ultimately impact negatively on the child, something we all want to avoid.
Amendments Nos. 119 and 126 would ensure that the Bill denies the non-resident parent the opportunity for malpractice. Has the Minister considered that a non-resident parent may seek to avoid paying his child maintenance fees by transferring his account to another bank? I have just commented briefly on the electronic transfer of money, so perhaps he would like to consider that at the same time. At the moment the transfer happens, the money is lost to the system so far as CMEC is concerned. I have proposed the former amendment to prevent any Houdini tricks and the latter to consider that this might be a circumstance in which an application may be made to the commission for it to review an order.
I turn now to a more detailed examination of Amendment No. 181. This is a provision to safeguard against the possibility that the actions of CMEC could restrict parents from fulfilling their financial responsibilities to their child. The Bill should do everything possible to facilitate parents to provide sufficiently for their offspring; it should never hinder the ultimate objective. Noble Lords will be aware that CMECs power to confiscate a driving licence is one that the CSA currently holds. In relation to my earlier argument, I must first welcome the fact that a confiscation would occur only after recourse to the courts. I am not opposed to penalising errant parents who refuse to meet their responsibilities
Lord McKenzie of Luton: I am not sure that item is in this group.
Lord Skelmersdale: It is not in the right place. I had better stop at this point. I beg to move.
Lord McKenzie of Luton: Perhaps I may start with Amendment No. 135, which seeks not to exclude deduction orders from being used against accounts that can be used only partly for business purposes. In light of the government amendment, of course, this amendment will no longer be appropriate, as the amended clauses will now remove such exclusions. Following on from that, Amendment No. 114 also seeks to extend the scope of deduction orders to all accounts. As we have made clear, we intend to expand the remit of deduction orders, but we do not think it appropriate from day one for deduction orders to be used on every type of account. As I outlined earlier, we would like to see accounts such as those held by more than one person for the purposes of business initially excluded by secondary legislation.
I hope noble Lords will agree that although increasing the remit of deduction orders in the Bill is a positive way to enable the commission to collect more maintenance, it is important to allow sufficient opportunity to consider carefully how far that remit should be extended. I trust that this also addresses the issue raised by Amendment No. 115, which seeks to expand the current account deduction orders to any joint trade or business account.
Amendments Nos. 137, 140, 141, 144, 147, 149 and 155 would prevent lump-sum deduction orders being used in relation to anyone other than licensed deposit takers. During consideration of this group of amendments, we have been unable to find any reference to licensed deposit takers in current legislation. I think that the term used to exist in old banking legislation, but went out in the mid or late 1980s. As a result, we are not quite sure how critical it is.
Lord Skelmersdale: I thought that the Minister was going say the late 1800s.
Lord McKenzie of Luton: The amendment could be used to open loopholes or to encourage non-compliant parents to lodge their money with people who are not covered by the term deposit taker. We would like to prescribe others who are likely to hold
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On Amendments Nos. 119 and 151, I assure noble Lords that in both instances the clauses already achieve what the amendments strive for in that there is already a power to include in regulations a requirement on the deposit taker to provide details of when an account is closed. Indeed, the banks have an obligation to notify the commission if the NRP closes the account or opens other accounts, where that information is available to the banks.
In the case of a lump-sum deduction order, the greatest amount at which the order will be set is the amount of arrears stated when the order was first made. It cannot be increased beyond that amount and is intended to be collected in one payment rather than over a period. However, it is acknowledged that the order will continue where there is an insufficient amount available to be deducted in that one payment. Again, we touched on that earlier.
Amendment No 126 would remove the power of the Secretary of State to provide in regulations for the circumstances in which a request may be made for a review of a deduction order. It is worth noting that this particular subsection is extended as part of the Governments amendments. It now includes a regulation-making power to provide a right for the parties affected by an order imposed, including joint account holders, to request a review. This is not an appeal.
The amendment would allow regulations providing for the order to be varied, but only on the initiative of the commission. It would not allow for an application for a review by the non-resident parent. At this stage, we envisage that the right to request a review will be available in cases of hardship or a significant change of circumstances. We are however happy to hear views on the appropriate grounds for review. All the regulations relating to this clause will be subject to the affirmative procedure.
Finally, Amendment No. 116 seeks to require the commission to impose an order that applies to maintenance arrears, to ongoing maintenance, or to both. In reality, however, these are the only three options. The current drafting is permissive in recognition that we give the commission the option to use regular deduction orders to collect both past and future maintenance. I therefore urge the noble Lord to withdraw the amendment.
Lord Skelmersdale: Two points arise from what the Minister has said. First, not all the amendments are in my name. Amendment No. 115, for example, is not. It is in the name of the noble Lord, Lord Kirkwood, and I do not know whether he wants to speak. Secondly, the fact that there may be no definition of a
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Lord McKenzie of Luton: I shall reflect on the drafting, but I have tried to do battle with parliamentary counsel in the past and invariably lost. If there was a transfer from one bank to another, the transferring bank would generally know to whom the money was going. That would not be the case if someone withdrew the readies and then deposited them in another bankor at least the first destination on the transfer, if not the final destination.
Lord Skelmersdale: I seem to remember that there are vast amounts of legislation about money-laundering.
Lord McKenzie of Luton: Does that not help rather than hinder the case?
Lord Skelmersdale: I doubt it very much.
Lord Addington: Most of the amendments in this group have been dealt with in what the Government have said previously, so we will not move those to which we have put our name.
Lord Skelmersdale: I shall not prolong the discussion. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 115 and 116 not moved.]
Lord McKenzie of Luton moved Amendments Nos. 117 to 118:
(a) may not be made in respect of an account of a prescribed description; and(b) may be made in respect of a joint account which is held by the person against whom the order is made and one or more other persons, and which is not of a description prescribed under paragraph (a), if (but only if) regulations made by the Secretary of State so provide.On Question, amendments agreed to.
[Amendment No. 119 not moved.]
Lord McKenzie of Luton moved Amendments Nos. 120 to 125:
(1) Before making an order under section 32A in respect of a joint account the Commission shall offer each of the account-holders an opportunity to make representations about
(2) The amounts to be deducted from a joint account under such an order shall not exceed the amounts that appear to the Commission to be fair in all the circumstances.
Clause 21, page 11, line 6, leave out a persons credit in a current and insert the credit of an
Clause 21, page 11, line 11, leave out from deposit-taker to end of line 13 and insert at which an order is directed to deduct from the amount standing to the credit of the account specified in the order a prescribed amount towards its administrative costs before making any deduction required by section 32A(5)(a);
Clause 21, page 11, line 15, after made insert (and, in the case of an order made in respect of a joint account, to the other account-holders)
On Question, amendments agreed to.
[Amendment No. 126 not moved.]
Lord McKenzie of Luton moved Amendments Nos. 127 to 133:
Clause 21, page 11, line 32, leave out from which to order in line 33 and insert the deposit-taker at which an order is directed, the person against whom the order is made and (in the case of an order made in respect of a joint account) the other account-holders may apply to the Commission for it to review the
Clause 21, page 12, line 2, leave out magistrates court (or, in Scotland, to the sheriff) and insert court
Clause 21, page 12, line 13, leave out from of to end of line 15 and insert the court to which the appeal under the regulations lies
On Question, amendments agreed to.
Clause 21, as amended, agreed to.
Clause 22 [Lump sum deduction orders]:
The Chairman of Committees: If Amendment No. 134 is agreed to, I shall not be able to call Amendment No. 135 for reasons for pre-emption.
Lord McKenzie of Luton moved Amendment No. 134:
(1) The Commission may make an order under this section if it appears to the Commission that a person (referred to in this section and sections 32E to 32G as the liable person) has failed to pay an amount of child support maintenance and
(1B) The Secretary of State may by regulations make provision as to conditions that are to be disregarded in determining whether an amount is due or accruing to the liable person for the purposes of subsection (1)(b).
On Question, amendment agreed to.
[Amendment No. 135 not moved.]
Lord McKenzie of Luton moved Amendment No. 136:
On Question, amendment agreed to.
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