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The Parliamentary Under-Secretary of State for Work and Pensions (Maria Miller)
It is a pleasure to serve under your chairmanship, Mr Weir. You have a tendency to chair a lot of our debates on welfare.
I congratulate my hon. Friend the Member for Loughborough (Nicky Morgan) on securing the debate. It is difficult to do justice to the wide range of issues raised by Members on both sides, but the debate has left me with the overwhelming feeling that the system is broken much more fundamentally than just a broken IT system. I may have smiled wryly before because, when the right hon. Member for Stirling (Mrs McGuire) referenced IT systems, I had a vague recollection, which officials have just confirmed, that the new future scheme was supposed to have been introduced under a Labour Government but has been delayed considerably since its inception—hence the wryness of my smile.
Mrs McGuire
Does the hon. Lady accept that the first system was rubbish anyway?
Maria Miller
I think the right hon. Lady misunderstands me. I mean the introduction of the future scheme, which was considerably delayed under the previous Administration.
I am also somewhat surprised that Stirling seems to be atypical. Although the right hon. Lady might have only a handful of cases or fewer troubling her postbag, the statistics say something considerably different, which is that the Child Support Agency receives more than 20,000 complaints every year. I know that the agency’s chief executive is absolutely unhappy about that and is doing a great deal, working with staff, to do something about it, but it is indicative of the situation facing us.
Heather Wheeler
I hope that my hon. Friend will get around to talking about the duty of care, because if the CSA mucks up, there is nowhere else for the parent to go.
Maria Miller
My hon. Friend is right that as a Government we have a duty to ensure that we have a system that operates correctly for families. I would like to take her back a step, though, to look at the fundamentals.
The reality is that every child in this country has two parents who have a commitment to that child for life. For too long, the evidence has been conveniently ignored that children who live in a stable family do better than those who do not, and the most stable families that we have are married ones. This Government do not ignore the evidence. My hon. Friend the Member for Sherwood (Mr Spencer), who is no longer in his place, was right to say that both parents have a right to stay involved in their children’s lives. I applaud the work being done by my colleagues in the Department for Education to make sure that that will happen more readily in the future.
Children thrive when both parents take an active role in their lives, and evidence from elsewhere in Europe underpins that. If adult relationships break down and parents do not work together to ensure that they both continue to play an active role in their children’s lives, it is the children who suffer. For me, that is the starting point for today’s debate. Having the opportunity to reframe the subject is important for all of us here.
The hon. Member for Edinburgh East (Sheila Gilmore) got it wrong, I think, when she said that we are trying to say that the CSA causes animosity. The Government are not saying that; we are saying that the CSA is making the situation worse not better, and at a cost of almost £500 million a year that is completely unacceptable. For too long, the child maintenance system has played a one-dimensional role—pretty badly—focusing almost exclusively on money transfer. IT breakdowns apart, perhaps that is why it has fallen so short of the mark and why so many Members have taken part in today’s debate. In the past, the Government have spent almost 10 times more on the CSA, its IT systems and administrative processes for money transfer and enforcement, than on supporting families to work together to fix their relationship problems, which the evidence indicates is a more successful approach. We have to change that.
As right hon. and hon. Members have said, more than half the parents who use the current system say that they would like to make their own arrangements if they had the right support to do so. That is not to say—
Mr Mike Weir (in the Chair)
Order. There is a Division in the House, and I understand that there may be several. The sitting is suspended until the series of votes ends.
Mr Mike Weir (in the Chair)
The main players are all here, so we will resume the debate. Minister, you have 10 minutes.
Maria Miller
What I have said so far is the basis for the reform that this Government are putting in place. I pay tribute to the 8,000 staff at the Child Support Agency and all that they do, with the difficult system they work with, but I share the view hon. Members have expressed today that the current system is not working well enough for the people who need it the most. We inherited two sets of rules, three IT systems and more than 20,000 complaints every year, and reform that has failed to date. It is time to change the role of the child maintenance system and set it in context of the Government’s broader family and social justice policy, which is founded on the evidence that children have a better life with their parents providing support and protection throughout their childhood.
My hon. Friend the Member for South East Cornwall (Sheryll Murray) was right to say that parents need support from each other. Indeed, we have recently set up a customer panel to do just that and we are considering how to develop it further.
The hon. Member for Edinburgh East was right to say that we have to take into account the views of those who work in the field. They are indeed vital, but I caution her against focusing simply on the views of the legal profession, because as MPs who deal with such issues day in, day out, we all know that many people have more grass-roots experience, and we need to draw on that. Indeed, we as a Government have drawn on such voluntary and community sector experience in making our plans for the future scheme. A group of experts in the sector have worked with us to set out how we can ensure that parents have the right information and support, particularly early on, to work together post-separation and to make sure that both parents remain actively involved in their children’s lives. We have already announced £20 million to make that happen—that is in the current spending review. That £20 million, previously spent on IT systems and the rest, will now be used to support charitable organisations, which we all know do so much effective work with families. That funding adds to some £45 million that the Government are already spending in 2012-13 alone on supporting families and relationships.
The money will provide the sort of tangible help that makes a real difference to families’ lives when separation is involved, and it will do so in a way that supports children. It will cover the provision of an online distributable web application; training for voluntary and community organisations to provide telephone support and improved face-to-face support; and up to £14 million for the recently launched innovation fund, which will help innovative ideas to get off the ground and measure their success in supporting parents during family separation.
I reassure my hon. Friend the Member for Gosport (Caroline Dinenage) that we know that not everybody will be able to work together. She is absolutely right about that. The hard work that she does in her constituency proves that not everybody can come to their own arrangements. That is why we will also introduce a new statutory child maintenance service for parents.
My hon. Friend the Member for South Swindon (Mr Buckland) has immeasurable experience, and on a number of occasions I have had the benefit of his wisdom regarding reform in this part of my ministerial portfolio. He is right that tough enforcement action is needed. The Child Maintenance and Other Payments Act 2008 contains tough enforcement powers and we are committed to ensuring the implementation of the new statutory scheme, which will be introduced this year, along with powers to manage arrears of maintenance payments that have been accumulated under the existing scheme and are not collectible. We want to make sure, first and foremost, that we have the right statutory scheme before we take on those forcible powers that my hon. Friend thinks—and I agree—could work so well.
I will try to deal with the main issues raised in the debate. One that troubles many Members is that of non-resident parents whose lifestyles are inconsistent with their declared earnings. That is often coupled with being self-employed and other ways of playing the system that hon. Members have said some parents may be exploiting. The problem is not new and we think that our reforms will start to address it. We will use information from Her Majesty’s Revenue and Customs about taxable income alongside other data to calculate the amount of maintenance that a non-resident parent is required to pay, and that information will be updated every year.
That is an important innovation, because we will no longer have to rely on declared income and will move instead to a system that relies on data provided to HMRC. Of course, some individuals may not declare all their income to HMRC, but that is a different matter. We are working closely with HMRC to do as much as we can to ensure that such income estimates are accurate and kept up to date, which, under the current system, they are not. The right hon. Member for Stirling is probably aware of all those issues from her time in government, and I hope she agrees that this is an important step forward.
Mrs McGuire
Given that we are dealing with people who put in a self-employed schedule D return, as opposed to the pay-as-you-earn, can the Minister give us any indication about where she will be taking the declared income figure from? Will it be from declared income, or will it be from income after all the other legitimate deductions come off—car use, boots for work and so on; all of the things that can be taken down—so that the taxable income at the end is far lower than what the person actually draws in?
Maria Miller
The right hon. Lady will know that we are looking at those sorts of details right now. I take from her comments that she wants to ensure that we are dealing with an income that is representative of the income that an individual has, rather than an income that may be depressed for the purposes of the calculation that is being made. I assure her that those are exactly the sorts of conversations that we are having.
The change to using HMRC data will also give us a much more efficient system, getting money to children quicker and more effectively tracking down parents who fail to pay. On that note, my hon. Friend the Member for South Swindon raised an important issue regarding armed forces personnel. We are reviewing how to provide a service to assist service personnel in this respect. I hope he finds that reassuring.
My hon. Friend the Member for South Derbyshire (Heather Wheeler) raised an important issue relating to the 12-month rule. Since I became a Minister, I have looked at that in some detail. We are looking for the evidence needed to quantify the scale of the problem and to ensure that we understand it fully, but I understand her point. I have received other representations on the matter and officials are working with the legal community and with the Ministry of Justice to consider how we can resolve the problem. It cannot be right to have a system in which people can play the rules to their advantage. We must have a system that works equitably across the piece. I undertake to write to my hon. Friend in more detail about the actions we are taking and to keep her fully informed of how we move forward.
My hon. Friend the Member for Romsey and Southampton North (Caroline Nokes) and various Scottish Members brought up the minute of agreement, which I have looked at in some detail. We do not feel that we can take that forward as part of the child maintenance system for which the Department for Work and Pensions has responsibility, but I know that my colleagues are well aware of it. If time were to permit—it does not today—I could talk a lot about the important innovations being made in the Ministry of Justice on mediation, which may well deal with some of the issues that the minute of agreement deals with.
In the few minutes that I have available, I wanted to address some of the other detailed points raised by my hon. Friend the Member for Loughborough, who is an assiduous constituency MP—
Mr Mike Weir (in the Chair)
Order. We have run out of time for this debate.