Welfare Reform Bill

Baroness Tyler of Enfield Excerpts

Monday 28th November 2011 Grand Committee

[Baroness Sherlock]

My Lords, I rise to support and speak specifically to Amendment 113B, to which my name is attached. In doing so, I remind the Committee of the interests which I have in the Register, in particular that I was a non-executive director of the Child Maintenance and Enforcement Commission, having stood down from that position shortly after my introduction to the House. I am also a former chief executive of the National Council for One Parent Families, which has now merged with Gingerbread. I am very grateful to Gingerbread and other organisations for their briefing.

It is a huge disappointment to me that this issue has come at the end of the Bill because, along with the noble Lord, Lord Kirkwood, and many other noble Lords, this is one of my favourite subjects. Frankly, I could happily talk about child support for a very long time. However, as the noble and learned Lord, Lord Mackay, is looking sternly at me, I shall limit my remarks to only one of the amendments and then speed on to allow him to offer an infinitely more informed view.

The noble Lord, Lord Kirkwood, has explained why the amendment is necessary. In particular, it would re-establish the notion of the objectives that are currently the main objectives of the commission, which will disappear as a result of its being abolished and brought back inside DWP as an executive agency. No doubt in due course these will become objectives of the Secretary of State, but I want to explain why it will be a problem if they vanish altogether from legislation.

At the moment, the commission’s main objective is to maximise the number of children who live apart from one or both of their parents for whom effective maintenance arrangements are in place. There are two subsidiary objectives, the first of which would encourage the support and the “making and keeping” by parents of voluntary maintenance arrangements. The second would support the making of and compliance with statutory arrangements. A further objective of the commission is:

“The Commission shall aim to pursue, and to have regard to, its objectives when exercising a function that is relevant to them”.

Not only must it do that but it must also have regard to those objectives in deciding how it discharges its various responsibilities.

As the noble Lord, Lord Kirkwood, said, Maria Miller, in the House of Commons, as I may now say, has said that the Government remain committed,

“to maximising the number of effective … arrangements”.—[Official Report, Commons, Welfare Reform Bill Committee, 24/5/11; col. 1103.]

That is welcome but I should like to explain why it is not enough. When I was a member of the board, we discussed and debated the priorities of the commission, what we should do and how we should do it. We came back repeatedly to the objectives set out by Parliament. Those were very much in front of us at all times.

If we were tempted to forget them, the very able civil servants who worked for the commission and the department would remind us of them at relevant moments, which they were right to do. They carried considerable weight. In fact, they carried far more weight than the assurance of the Minister of the day—distinguished though he was, of course. It is right that the objectives set down by Parliament should carry more weight than the views of any Minister who happens to hold office on any particular day. That is what Parliament is for. There is a big diminution in weight in moving from having clear objectives set out in legislation to having simply the assurance, however welcome, of the Minister of the day.

CMEC was beginning to make some significant improvements. It was created in 2008. Last year, 970,000 children benefited from child maintenance, including more than 100,000 from private arrangements, which must be due considerably to the CMEC option service and the fact that the commission had a statutory obligation to go out and pursue private arrangements. In March 2008, the figure was 750,000, so there was quite a big jump.

The noble Lord, Lord Kirkwood, mentioned possible cost reductions of the order of 30 per cent. This is important because—I am sorry to bring this to the attention of noble Lords—there are people with suspicious minds who fear that the Government’s primary aim is to save money, rather than to move to a better system of child support. Like other noble Lords, I would not dream of having any truck with such a notion. But perhaps the Minister could help Members of the Committee to make sure that they are in a position to understand and to rebut these claims when they are made by people outside this Chamber.

It is important because, if there is no broader objective to maximise the number of effective arrangements in place, Ministers might feel that they have done their job simply by deterring people from using the statutory system of child maintenance. They do not have any obligation to make absolutely sure that those people are going elsewhere and making arrangements, rather than simply not making any arrangements at all. If the Minister were willing to accept that this is an important objective, he could reassure us all. In the absence of that, there is a very real danger that these charges will come to be seen—we will go on to discuss them in detail—not simply as a means of raising money but primarily as a means of deterring people from using the statutory system in order to save considerable amounts of money in administration to the state. Frankly, it is hard to see how savings of the order that have been described by the noble Lord, Lord Kirkwood, can be achieved otherwise.

I am delighted that the noble Lord, Lord Freud, has given the noble Lord, Lord De Mauley, the opportunity to step into the breach on so important an occasion. Should the noble Lord, Lord De Mauley, hear at any point someone saying, “I am right behind you”, I suggest he takes a look behind him to be sure that that is true. I am delighted to see him at the Dispatch Box on such an important occasion. Perhaps he will take the opportunity to reassure the Committee, first, on whether the Government accept the content of the amendment. Are they committed to maximising,

“the number of those children who live apart from one or both of their parents for whom effective maintenance arrangements are in place”?

Is the principle acceptable? If it is acceptable, is he happy to put this into legislation? After all, it is likely that the Official Opposition are supportive since it was their Bill which brought these words into legislation in the first place. If we are all in agreement, perhaps this happy outbreak of unanimity can be celebrated by having an amendment accepted in Grand Committee. I look forward to that. If he is not able to do that, will he explain why not, what he believes the consequences will be and how else we can go out and give assurances to the cynics in that difficult world?

[Baroness Tyler of Enfield]

My Lords, I will speak briefly to Amendment 113B. In so doing, I declare an interest. I am currently the chief executive of Relate, which provides a wide range of services to separating families. I am also part of an advisory group of people from the voluntary sector which advises DWP Ministers on what a network of integrated support services might look like. From that point of view, it is important that that is clearly stated on the record.

I want briefly to support the case that has been put forward by my noble friend Lord Kirkwood as to why it is important that we incentivise non-resident parents to engage in the gateway process, as well as parents with care. There are two points I want to make. First, the gateway and the application charge—and I know that we will come to the charge in a later grouping—bite at the moment on parents with care wishing to use the statutory child maintenance system. The aim of this is to incentivise them to try to negotiate a voluntary agreement with the other parent instead. I support that. It is right and proper, where it is practical, that incentives to do so are built in. But there is no equivalent mechanism pushing the non-resident parent actively to engage in the process of trying to reach a mutually agreeable arrangement. As the legislation is currently constructed, it is only after a parent with care has paid an application fee of £100 and a statutory calculation has been made that any incentive will be given to the non-resident parent to reach a private agreement. That is basically very unfair.

My second point is a more positive one: the gateway stage is an opportunity for meaningful conversation between both parents. It aims to explore the scope for reaching collaborative arrangements, to assess what help either or both parents might need in order to arrive at such arrangements and to signpost and refer one or both parents—and, indeed, the children involved—to suitable provision and the help that exists for separating parents and families. Non-resident parents who are responsible for paying child maintenance should, I feel, be especially involved in this process.

I conclude by saying a couple of things that come very much from my experience at Relate. It is very important to children that both parents after separation continue to be involved as co-parents of those children. The relationship between the adults may be completely and utterly at an end, and indeed new relationships may well have been formed; but for that child, the active involvement—of course, where safe—of both parents is absolutely critical, emotionally, in practical ways, financially and in a range of other ways. It is critical that these new arrangements, however they are finally constructed, put the maximum possible incentive on both parents to see how they can discharge their responsibilities to be effective co-parents after separation—a responsibility which I think that most of us think is for life.

[Baroness Lister of Burtersett]

My Lords, I, too, shall speak in support of Amendment 113B, although what I have to say is also relevant to Amendment 113DA in the next group. I, too, thank Gingerbread for its help.

I want to concentrate on how Clause 131 in particular, coupled with the wider government proposals to charge parents for use of the statutory child maintenance scheme, will disproportionately impact on women who, according to the Government’s own analysis, make up around 97 per cent of parents with care who are eligible for child maintenance. It seems very surprising that, at a time when the Government are worrying about the erosion of their support among women, particularly so-called C2 women, they should be proceeding with a policy on child maintenance which will unfairly impact on this group.

The Government say that the new gateway and the proposed charges are intended to drive behavioural change—yet again—yet in the brief circulated last week, the DWP acknowledges that a significant proportion of parents will not be able to collaborate and that there are circumstances where there will be no reasonable steps that they could take. Therefore, echoing a question I asked last week in relation to the benefit cap, what behavioural change are they trying to achieve in such cases? Is it really fair to subject this group to charges, particularly in the name of behavioural change?

--- Later in debate ---

[Lord Kirkwood of Kirkhope]

My Lords, just for completeness I shall speak to Amendment 113E. I will be grateful if the Minister will respond to the prospect of, if everything else fails, having a waiver system for low-income families facing some of these fees. I want to know whether the Government have thought about this carefully and looked at the operational and other implementation arrangements that might be necessary. I look forward to the Minister’s response.

[Baroness Tyler of Enfield]

My Lords, I would like briefly to add a few comments to those that have been made so powerfully around this Committee. We have heard some moving quotes today, but the one I want to give is not from someone who has been part of this process as an end user but from Sir David Henshaw who, back in 2006, came up with the report that is often cited as being the genesis of the idea of charging. We have heard his name referred to on a number of occasions as his policy has been explained. Sir David Henshaw himself recognised the limits to charging when he said:

“I do not want to create a disincentive to use the service for those parents who have no other option for agreeing maintenance”.

We know, because DWP estimates tell us, that about half of all eligible families have no child maintenance arrangements at all. The danger is that even more children in poorer families will go without child maintenance as a result of the proposal to charge the parent with care. This is my final point, which I want to link to the one I made on the previous group of amendments. Not only will the children be worse off—we have heard some graphic and moving accounts of the real hardship that some children could be in—but more will grow up without a role model of a father who contributes, however modestly, to the cost of raising his own children.

[Lord McKenzie of Luton]

My Lords, like all noble Lords, I am indebted to the noble and learned Lord, Lord Mackay, for tabling the amendment. His being in tandem with the noble Lord, Lord Newton, is an irresistible combination. I do not envy the Minister having to reply.

There have been some powerful and moving contributions. I should start by putting clearly on the record where we are in relation to charging. It has been suggested that what the Government are bringing forward is just based on the previous Government’s proposals, but that is not so. It is absolutely correct to say that charging is permitted under the 2008 legislation, which is supported by the noble and learned Lord, Lord Mackay. But that is enabling legislation like so much of this Bill. It certainly did not envisage proposals such as those advanced by the coalition Government. It should be recognised of course that there were charging arrangements under the original 1991 legislation, but I believe that that was stopped in 1995 because the CSA was not delivering.

Our position on charging is clear. It is reflected in the White Paper entitled, A New System of Child Maintenance, dated December 2006. It cites in part what the noble Baroness, Lady Tyler, has just said and makes reference to Sir David Henshaw.  Paragraph 5.48 states:

“We recognise the importance of having a charging regime that does not dissuade vulnerable and low-income parents with care from seeking maintenance in the first place. Therefore, the future charging regime will be based on three clear principles. First, that the charging structure should incentivise non-resident parents to meet their responsibilities. Second, that the clear burden of charging should fall on the non-resident parent and not the parent with care. Third, that cost recovery for C-MEC should never be prioritised above payment of outstanding debt for the parent with care”.

Those provisions were not debated particularly extensively when we considered the Bill in 2008, although there was some discussion. At that time, we made it clear that it was for CMEC to advise and recommend to Ministers the detail of any charging regime but that such advice would be subject to CMEC’s overarching objective of maximising the number of children benefiting from effective maintenance arrangements, a point made by my noble friend Lady Sherlock a short while ago.

Although the clear focus on any charging should be on the non-resident parent, CMEC was not precluded from considering a small application fee to both non-resident parents and parents with care where voluntary arrangements might be more effective for them. We also made it clear that any charging structure should not commence until the service was fit for purpose and that this would not be before the launch of the new scheme then planned for 2010, which I think is now planned for 2012.

The Government have proposed a range of charges, including an upfront application fee of £100, which would be reduced for parents on benefits, and an ongoing collection charge on both non-resident parents and parents with care. The latter would be avoided for each if maintenance direct were used. However, whether maintenance direct is a secure and sustainable method of payment is wholly dependent on the non-resident parent. The Government’s proposals for charging fall foul of our criteria in a number of respects. An upfront fee of £100 is bound to act as a deterrent for lower-income households. It is payable not only in circumstances where a voluntary arrangement might be possible but in circumstances where it is not, for whatever reasons. That seems highly likely to increase the prospect of circumstances where no maintenance arrangements are entered into. Penalising parents with care with a collection charge, which depends on the NRP acting responsibly, is wholly unjust. The proposals allow for a reduction in the case of those on benefits but there is no exemption. Neither is any relief proposed for the collection charge.

That is why we are fully supportive of the amendment in the name of the noble and learned Lord. In short, it states that there will be no fees charged to parents with care where they have taken all reasonable steps to enter into a maintenance arrangement and it is not possible or appropriate to do so. There may be a multiplicity of reasons why it is not possible or appropriate to do so, some of which are particularised in later amendments. My noble friend Lady Sherlock has just spoken to one, as indeed has the noble Lord, Lord Kirkwood. In such circumstances, the only prospect of obtaining arrangements is the statutory system. There should be no charge which precludes this, which is what the noble and learned Lord’s amendment seeks to secure.

Amendment 113E, in the name of the noble Lord, Lord Kirkwood, seeks to introduce a reduction or waiver of fees where the income of a parent falls below prescribed levels. We have already indicated why we consider an exemption to be appropriate, although we acknowledge that the scope of Clause 6 is already wide enough to accomplish this.

Amendment 113EA has been spoken to powerfully by my noble friend and sets down circumstances where voluntary arrangements would clearly be inappropriate. The Government, I am sure, will be sympathetic to this given that they already acknowledge that individuals experiencing domestic violence will by-pass their new gateway.

Government Amendment 114 prompts me to raise questions relating to issues of enforcement. Can the Minister give an update on the various measures contained in the 2008 Act, including the use of deduction-from-earnings orders; regular deductions from accounts; lump-sum deduction orders; orders preventing avoidance; administrative liability orders; disqualification for holding or obtaining travel authorisation; curfew orders; and disqualification from driving? Can he say which of these are in force? If it is about getting sensible arrangements, it is also about making sure that those people who are responsible non-resident parents meet their commitments. We put in place a raft of enforcement measures which should have facilitated that and I would be grateful for an update on their progress.