Divorce (Financial Provision) Bill [HL]

Debate between Lord Kennedy of Southwark and Baroness Deech

Friday 21st November 2014 Lords Chamber

[Baroness Deech (CB)]

My Lords, I will speak also to the question of whether Clause 6 stand part of the Bill. All these amendments, starting with this one, have at their heart the protection of children and assistance to middling and lower income families, who are facing terrible problems now that legal aid has been removed from assistance in divorce law, and with the exceedingly high number of divorces that we have every year.

The law needed reform anyway, but the urgency that now arises comes from the removal of legal aid. Only this week, the Bar Council reported an 88% increase in the number of people having to represent themselves in the courts. Throughout the Bill, I am trying to provide a framework that is just but which also promotes autonomy, clarity and entitlement. Given that legal aid has been removed—and I do not envisage an improvement in that situation for years to come—we have to help the poor families who are struggling at one of the worst moments in their lives with something expensive and complicated. Noble Lords will all have seen the accounts of cases in which couples have assets of, let us say, £1 million—not so difficult if you have a house—half or three-quarters of which goes on lawyers’ costs because they cannot reach an agreement; they have no firm framework within which to do so.

This first amendment emphasises what was implicit—it would now make it clearer—that the Bill is not meant to affect the existing provision for children, let alone make it worse. This amendment has the effect of retaining untouched Section 25(1) of the Matrimonial Causes Act 1973—note that this House has not revisited that law since 1973—and retains a provision that in dealing with finance after divorce the interests of children under 18 are the first consideration for the court. They are not “paramount”, which is an even stronger word that is used as regards decisions about their residence.

There is of course scope in the Bill, as there has been previously, for the matrimonial home to be preserved for the use of, let us say, the mother and young children until they reach majority, even if a half share has already been allocated to the father but its realisation or liquidation postponed. From that follows the deletion of Clause 6, which spelt that out in a different way. This amendment also serves to preserve Section 25A of the Matrimonial Causes Act—the desirability of the clean break.

We are not talking about child maintenance as such, because there is a new Child Maintenance Service, successor to the Child Support Agency, and that law will continue as ever. I might also add at the beginning for clarification that the noble and learned Baroness, Lady Butler-Sloss, who cannot be in her place today, supports this, and the noble and learned Lord, Lord Mackay, has specifically authorised me to give his view to the House. He says:

“I support your Bill and support the amendments. I think it vital that the law should contain a provision setting out a generally suitable formula for the division of the assets of a divorcing couple that would guide them without recourse to the courts. It would not harm this concept that a discretion should be available to the court to depart from it on cause shown”.

In fact, a general consensus is building up through the courts that something must be done about this law. It is for the run-of-the-mill divorcing couple who can no longer afford legal representation. I beg to move.

[Lord Kennedy of Southwark (Lab)]

My Lords, I am sure that the House is very grateful to the noble Baroness for bringing forward this Bill for consideration, and I hope that we can make progress today through the Committee stage. I am supportive of what the Bill seeks to do. It is a fact that relationships break down, and proposals to make financial settlements between parties as simple as possible, enabling both parties to retain a greater proportion of their assets, are to be welcomed. As the noble Baroness has explained, this group of amendments seeks to leave untouched Section 25(1) of the Matrimonial Causes Act, which makes it clear that the interests of the children are the first consideration when dealing with finances after divorce. It is also proposed in this group, as a consequence of that amendment, that Clause 6, which dealt with children, should no longer stand part of the Bill, as it would be confusing and could conflict with provisions already in place. These are very sensible amendments, which I hope will find favour with the Government.

--- Later in debate ---

[Baroness Deech]

My Lords, in moving Amendment 2, I speak also to Amendments 3, 4, 20A, 21, 22 and 26. What the amendments in this group have in common is that they are minor and technical. I had great assistance with the drafting of this Bill over the summer, as your Lordships will have noticed, and these amendments arise from the refinement of the drafting as it took place in reaching the final state of the amendments.

Amendment 2 is simply a correction, while Amendment 3 is a clarification. Amendment 4 ensures that this law, as I hope it will turn out to be, applies equally to civil partnerships and same-sex couple marriages. Clearly, a new law must apply to all different sorts of couples, whoever they are, who may go through the courts. Amendment 20A has come about simply because there has been a redraft. Amendments 21, 22 and 26 arose from the fact that there has been a preservation of flexibility of lump sums in distribution of property. This entire group is technical. I beg to move.

[Lord Kennedy of Southwark]

My Lords, this is an important technical group of amendments, which follow on from the previous group in clarifying that the provisions of Section 25(1) of the Matrimonial Causes Act remains in force and that we are referring only to subsection (2), for all the reasons that noble Lords gave in the previous debate, along with Amendment 3, which again makes it clear that we are referring to the Act in the amended form. The addition and clarification of the 2004 and 2013 Acts, as the noble Baroness advised the House, will clarify that the new law will apply to civil partnerships and same-sex couples, but not to cohabiting couples, who are the subject of a different Bill, to be introduced by the noble Lord, Lord Marks, which will have a Second Reading shortly.

The second part of the group removes subsections 5(1) and (2), which deal with the issue of periodical payments, discussed during the Second Reading debate in your Lordships’ House. They seek to address an issue that everyone recognises needs to be looked at; on these Benches we were concerned that there appeared to be a one-size-fits-all approach. In a later group, we will look at amendments that seek to take on board concerns expressed in the Second Reading debate and elsewhere.

Amendments 21, 22 and 26 make clear the divide between lump sum payments and ongoing periodical payments.

--- Later in debate ---

[Lord Kennedy of Southwark]

My Lords, this next group of amendments, or one amendment and one clause stand part, seeks to improve the Bill from its original form, taking into account matters brought out on Second Reading. I think that all noble Lords who spoke in that debate thought that the Bill was seeking to address issues that had not been addressed for far too long, so what we are seeking to do here today is very welcome. Amendment 5 in the names of the noble Baroness, Lady Deech, my noble friend Lord Grantchester and the noble and learned Lord, Lord Walker of Gestingthorpe, sets out clearly what a relevant financial order is so that there can be no ambiguity about it. As the noble Baroness, Lady Deech, said, lump sum orders are also included as they may assist in providing flexibility in dividing up total assets. The noble Baroness, Lady Deech, is opposing that Clause 2 stand part of the Bill, as there are amendments down that better define what is sought to be achieved here. If agreed, those amendments will be an improvement to the Bill as it is presently drafted. I can see the logic here and the clarification that that brings.

[Baroness Deech]

My Lords, I wish to say simply that of course the noble and learned Lord, Lord Walker, is right—that is why he is learned and I am just a noble Baroness and not learned. However, my point is that this House has not revisited the principles of financial provision on divorce in more than 40 years, despite all the changes in society and all the things that have happened—the changes in the position of women, women going out to work and the rise in divorce. It is really crucial to do so now because of the removal of legal aid and the need to help those who mediate and arbitrate and give them a starting point. The Government favour mediation yet there has been a decrease in the use of mediation. How can people mediate if they do not know what the starting point is? To mediate means to find a middle way, and therefore we need a parameter. That is why we are trying to clarify this law.

--- Later in debate ---

[Baroness Deech]

My Lords, it might surprise the noble Lord, Lord Cormack, to know that I am absolutely with him on the importance of marriage. I have spent much of my academic career writing about it in an atmosphere where I was almost a lone voice. I am with him all the way. I wish there was more we could do about it without being accused of claiming the moral high ground and so forth.

Nevertheless, I have studied the situation and realised, as the noble Baroness, Lady Shackleton, pointed out, that this is going on. The Supreme Court has recognised it. It is for this House to grab a hold of it. We should grab hold of all this law, which has been interpreted and elasticised and twisted around by the judges for 40 years without this House getting a grip on the principles. Now is an opportunity to recognise that we are where we are with 100,000 couples divorcing every year, leaving aside the many more breakdowns of cohabitation—and possibly in the future, civil partnerships and the relationships of same-sex couples who have not turned up in the statistics yet. My heart is absolutely with the noble Lord.

[Lord Kennedy of Southwark]

My Lords, this group of amendments starting with Amendment 7 in the names of the noble Baronesses, Lady Deech and Lady Wilcox, and my noble friend Lord Grantchester are all to Clause 3, which concerns prenuptial and post-nuptial agreements.

I see the arguments made that these agreements, which were not very common a few years ago, are on the increase and can provide certainty to both parties as to the division of assets in the result of a breakdown of the relationship. I recall the comments of the noble Lord, Lord St John of Bletso, when he told us at Second Reading that these agreements had in no way encouraged the breakdown of marriage. Also, the noble Baroness, Lady Wilcox, spoke about people who had been widowed or divorced and were afraid to marry again where there were assets they wished to protect and who were reluctant to commit again, fearing a potentially financially disadvantaged position at a time of life when starting again would be almost impossible. The noble Lord and other noble Lords spoke about this again today.

The amendments themselves seek to provide further clarity as to what this Bill seeks to do in respect of pre and post-nuptial agreements and build on the comments and points raised both inside and outside your Lordships’ House.