Draft Child Support (Management of Payments and arrears and fees) (Amendment) Regulations 2023
(5 months, 3 weeks ago)
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The Parliamentary Under-Secretary of State for Work and Pensions (Paul Maynard)
I beg to move.
That the Committee has considered the draft Child Support (Management of Payments and Arrears and Fees) (Amendment) Regulations 2023.
It is a pleasure to serve under your chairmanship, Mrs Latham, and I am pleased to introduce this statutory instrument, which, subject to approval, will help more families to access vital support through the Child Maintenance Service. It will also ensure that efforts and resources can be focused on taking action to collect unpaid arrears in those cases that will make the biggest difference to children.
The draft regulations are intended to further improve access to the Child Maintenance Service for all families, and to ensure that it runs effectively to focus on getting more money to children. First, to improve access, the regulations remove the £20 application fee to access the Child Maintenance Service. The fee was introduced in 2014 to encourage parents to come to their own collaborative family-based maintenance arrangements, rather than go down the statutory route by default. Evidence published by the Department for Work and Pensions as part of an evaluation of the fee and its impact shows that the £20 fee is not a significant factor for parents when making decisions about their child maintenance arrangements.
However, the evaluation found that families on lower incomes, whom we know disproportionately experience conflict and therefore are often in need of support, can find the application fee a financial barrier to accessing the service. It is important to highlight that around 54% of all applicants already pay no fee because of existing waivers, such as those for victims of domestic abuse and those aged under 19. Therefore, it is sensible to remove the application fee completely for all, ensuring that those most in need can get support more easily.
The regulations will also ensure that the service can more efficiently focus resources on getting larger, more recoverable unpaid payments flowing to children. To be clear, we continue to come down on parents who refuse to pay child maintenance and fail to take responsibility for their children. We do so using a range of enforcement powers to collect unpaid amounts. However, we are taking a pragmatic approach in these regulations by bringing forward powers to write off minimal amounts of £7 or less in a small number of inactive cases that would have been closed were it not for small outstanding balances.
We are introducing that measure for two reasons. First, keeping such cases open requires considerable resource, and taking action to recover such small amounts often costs more than the value of the debt. The cost of leaving such cases open could increase for decades, with no greater chance of money being paid to receiving parents. We need to ensure that taxpayers’ money, as well as caseworker time and effort, is directed effectively, for example by focusing action against parents who owe significantly larger sums and where the impact on children missing out on money is greater. Secondly, given that we close cases only when we have stopped calculating child maintenance payments, it is likely that such cases will no longer be needed. That could be because the child has become an adult, the parents have reconciled, or the absent parent has sadly passed away. It therefore makes sense to close these cases, not least for the certainty and clarity it provides for families.
Siobhan Baillie (Stroud) (Con)
I have just been before the Backbench Business Committee with the right hon. Member for East Ham (Sir Stephen Timms) to ask for a debate on child maintenance, so if we get our way, the Minister will hopefully be talking about this again. I see that the proposals affect only 2,800 cases, and both measures seem sensible, but every single MP gets many cases about the service, response times, or things being lost. How will the Department and the Government make sure that even this small change does not send the message that they are not interested in such cases or in ensuring that arrears are paid to families?
Paul Maynard
I very much look forward to the next debate that comes my way. I am slightly trepidatious, because this is not my policy area, but it is a good chance for me to learn a bit more and understand it better. My hon. Friend is quite right that we all get many such pieces of constituency casework, which shows the importance of getting this right. I can talk at much greater length about what we are doing, so I look forward to the debate.
The full details of the criteria permitting a debt to be written off are set out in the regulations. They include the maintenance calculations having ceased, and no payments having been made in the previous three months. In addition, the Child Support Act 1991 provides that for write-off powers to be exercised, we must be satisfied that it would be unfair or otherwise inappropriate to enforce liability in respect of the debt.
The changes build on a number of improvements that we have already made, and they are among the first in a wave of measures that we plan to bring forward to ensure that the service is more accessible, simpler and speedier, and ultimately gets more money to more children more quickly.
The measures represent proportionate, common-sense changes that will further improve the Child Maintenance Service. They are good for parents, good for the taxpayer and, most importantly, good for children. I hope that colleagues will join me in supporting them.
Alison McGovern (Wirral South) (Lab)
It is a great pleasure to serve under your chairship, Mrs Latham. Without rehearsing all the arguments ad nauseam, let me say that we support the measure and think it is good that it removes the application fee. The Minister has already explained why that is positive, and we agree with him.
I will not detain colleagues for long. I want to make three quick points and ask the Minister some questions. If the hon. Member for Stroud and the Chair of the Work and Pensions Committee are successful in securing a Backbench Business debate, more colleagues will be able to rehearse the issues for longer. A large number of cross-party colleagues would like the country to learn the lessons from their casework. I am one such Member, so I support that initiative for a Backbench debate, and hope that we can discuss these issues again without too much delay.
Following discussion of the measure in the other place, we know that the Government anticipate that the removal of the fee will have the positive impact of increasing the number of agreements. We also know, however, that the Government think that the fee is not the sole reason why there are not as many agreements as we all want. As the Minister has explained, it is very important, for anti-poverty reasons as well as basic fairness, for payments to be made to parents, but the fee is not the only problem. In response to a question asked by my colleague in the other place, the Minister explained in writing that 35%—more than a third—of receiving parents without arrangements said that they wanted a payment arrangement with the other parent. Although we know, as the Minister has explained, that the removal of the fee will have an impact, there is more to do to ensure that more parents secure an arrangement.
What research are the Government undertaking with parents who have experienced the system in order to ensure that it works better? What is the plan? A wide range of MPs and stakeholders know that the system does not work perfectly. It would be good if the Government could say more about how the removal of the fee will help. Furthermore, their own research identifies parents who want an arrangement, so could the Government share their plans for how those parents get one? Could we hear a little more about that research?
Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)
My hon. Friend makes a very good point about the need to know the details of the Government’s research. When the parent who should be paying is self-employed, or employed via a company that their new partner owns, there are often a lot of disputes about how much they actually earn and their household income. Does she agree that it would be interesting to know whether the Government have researched any of those problems, which seem to cross my desk regularly, and to hear their solutions? This measure is good, but it does not really touch the sides of some of those big issues.
Alison McGovern
I am coming to that, but my hon. Friend makes the point well. I am sure that the Minister and many colleagues would recognise that there is a broader agenda here about making the service much more effective for parents. I think everybody across the House will be anxious to hear more about that from the Government.
Secondly, I have been in touch with Gingerbread, the organisation for single parents—everybody on the Committee will know it well—about these regulations. It raised a couple of things with me, particularly in relation to the point that the Minister made about survivors of abuse. As he mentioned, previously the fee was waived for survivors of abuse. Gingerbread tells me that that enabled the CMS to know how many survivors of abuse were using the service. It is important that that is calculated, and that the service knows about the body of its service users who are survivors of abuse. When the fee is removed, how will the service know how many of its users are survivors of abuse, so that it can ensure an effective service for those people?
As you will know, Mrs Latham, we have gone on a big journey over the past decade on financial abuse and understanding how, unfortunately, abusers often use arms of the state to continue that abuse, even after separation, and even once protection is in place for the victim of abuse. The Child Maintenance Service is therefore on the frontline in protecting parents who have experienced domestic abuse from experiencing further abuse. If the Minister can say a little more about what training the service has planned, and about Gingerbread’s important question on how we will monitor how many parents using the service are victims of abuse, we would all find that helpful. Gingerbread also points out, quite rightly, that we might anticipate that more people will apply to use collect and pay, so it would be good to know how the Department is planning to ensure that that increase in demand is met.
Finally, we all understand the rationale—the Minister set out the case precisely—for writing off small arrears, particularly when the cost of pursuing them would far outweigh their value, but as the Minister also set out, we want writing off small arrears to increase the effectiveness of the service. Gingerbread says that it is not uncommon for its helpline to receive calls from people who are owed tens of thousands of pounds. Those are the arrears that we want tackled, so will the Minister say how writing off these nugatory amounts will enable the service to become more effective? That is what we all really want. If we can have a debate on this in Back-Bench time, I hope that we will hear from a huge number of colleagues, from right across the House, about what parents have experienced in trying to get debts paid. It is no small thing and can be an extremely frustrating experience.
It would be useful if the Minister could say more about, first, the Government’s research—what they hope to publish and what they hope for—so that we can understand the effectiveness of getting these agreements in place and what parents might find most helpful, beyond removing the fee. Secondly, perhaps he can say more about victims of abuse—how we will monitor them and make sure that the right training and resources are in place in the service. Finally—this is the major point—we all want an effective service. In the end, this is about all our kids in this country. This is about making sure that they do not grow up in poverty, and that their parents have enough money in their pockets to look after them. If the Minister could explain what the plan is to ensure effectiveness, that would be very helpful.
Stuart C. McDonald (Cumbernauld, Kilsyth and Kirkintilloch East) (SNP)
It is good to see you in the Chair, Mrs Latham. I want to briefly put on record the Scottish National party’s support for these draft regulations, and particularly for the scrapping of the £20 fee, which makes perfect sense. The Minister’s arguments for reprioritising resources, so that we chase not very small amounts of money but larger sums, also make sense, but obviously we need to monitor that very carefully. We would, of course, encourage the Government to go further on issues such as collecting pay fees, the 4% in particular. Some of the arguments that the Minister has used today for scrapping the fee could equally apply to that charge. Like Members from across the Committee Room, we want the overall performance of the service improved, but that is for another day. Perhaps it is for the Backbench Business debate that we hope is coming. In the meantime, we support these regulations.
Paul Maynard
I thank both the Front-Bench spokesmen for their support, and for their helpful summary of the questions, which gave me that bit longer to make sure that all my notes for answering them were in the right order. First, the hon. Member for Wirral South mentioned application numbers. The main thing that the Government have been doing is trying to use a more digital service called “get help arranging child maintenance”, which has been operational since 2022 and has seen the number of applications increase. That shows that we can we can create a pathway, so that people going through a breakdown in a relationship can seek out the right support.
The hon. Lady mentioned research. It helpfully says in my notes that research has shown that those on the lowest incomes are least likely to have an effective arrangement. It does not give me much more than that, I am afraid, so I will commit to writing to her on that point. I will try not to have to write to her on any other point, but I am giving the best answers I can.
The hon. Lady rightly raised the issue of domestic abuse. After we have removed the fee, we will continue to capture information about parents who need additional support, including as a consequence of domestic abuse, and ensure that they are able to safely use the service, because there are many safety issues around how money is transferred. We will move away from collecting the figures and towards using externally reported quarterly stats, but we will look at how best to capture the information in a usable format in the future.
The hon. Lady may be aware that CMS has a domestic abuse plan, which outlines key steps for caseworkers to follow to ensure that victims of domestic abuse are supported. That includes advice on contacting the police, for example, if the parent is in immediate danger. CMS can also act as an intermediary in direct pay cases, and provide advice on how to set up bank accounts with a centralised sort code to limit the risk of a parent’s location being traced. We also reviewed our domestic abuse training, and commenced using a single named caseworker to ensure that victims of DA are appropriately supported, so I think we are doing an awful lot on abuse in the home.
Alison McGovern
Could I ask the Minister to be clear on the statistics that will be published about victims of domestic abuse? I understand his point about training and the pathway that will be there, but from the point of view of public transparency, it is important that we can see how many users of the service are victims of domestic abuse, and that the data is publicly reported. I say that simply because, as he will understand, abuse has so often been completely hidden. Many people would be quite shocked to find out how many people are victims of financial abuse, so it is important that that is reported publicly, not just understood within the system. Could the Minister confirm that the Government will still report publicly how many users of CMS are victims of domestic abuse?
Paul Maynard
I take the hon. Lady’s point. It says in my brief that CMS will look at how it captures that information. I will ensure that that point is passed on to Viscount Younger in the other place when he is looking at whether the proposals are adequate. No decision has yet been made. Nothing has been ruled out; nothing has been ruled in. I accept her point, and like her, I am a champion of transparency wherever possible, so I will ensure that Viscount Younger writes to the hon. Lady.
On the points that were made about collect and pay and the calculation more generally, we are consulting on how we can improve both those things. I believe that the consultation on collect and pay is yet to start, but we announced in October that we would be consulting on how to collect and transfer maintenance payments. I understand that the consultation on the calculation side of things will also be launched shortly.
Finally, there is a very valid point, which I often hear in my own constituency, about cases involving vast sums that parents are unable to access for one reason or another. Where parents have certain categories of taxable income that are not captured by a standard child maintenance calculation, they can make a request to CMS to have the calculation varied. We have consulted on proposals to include more types of taxable income held by His Majesty’s Revenue and Customs in the standard maintenance calculation. The proposals were accepted, and legislation will be brought forward when parliamentary time allows. Cases involving complex income can be investigated by the financial investigation unit, which is a specialist team. Where there is evidence of fraud, the FIU will seek to prosecute, or forward the case to HMRC for action.
In summary, as everyone has agreed, the regulations mark the beginning of a more comprehensive legislative journey towards improving the Child Maintenance Service and represent a clear road map to action. I am committed to working with Viscount Younger to drive these plans forward in order to deliver a fairer, faster service for more families, especially the poorest. I thank everyone for attending the Committee.
Question put and agreed to.