Child Support Agency

Caroline Nokes Excerpts

Wednesday 11th July 2012 Westminster Hall

[Sheryll Murray (South East Cornwall) (Con)]

It is a pleasure to speak under your chairmanship, Mr Weir. I congratulate my hon. Friend the Member for Loughborough (Nicky Morgan) on securing this exceptionally important debate. It is on an issue that spans all constituencies. I cannot imagine being able to find an hon. Member who has not had many letters and e-mails about the Child Support Agency. The issues that parents face when claiming or being claimed against are massive; this is such a complex issue on both sides of the coin. I am sure that all hon. Members will agree with me when I say that one answer does not fit all, as every incident is so case specific; and it is near impossible to attain the best solution for everyone, especially when one law applies to all. I agreed with the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Basingstoke (Maria Miller) when she said that the child maintenance system was “broken”. I am pleased that the Government are taking action to reform the system, which is unworkable in most cases.

[Caroline Nokes (Romsey and Southampton North) (Con)]

Does my hon. Friend agree that a frustration our constituents often face, whether they are the parent with care or the non-resident parent, is that they find it very hard to make their voices heard by the CSA, or indeed anyone?

[Sheryll Murray]

I thank my hon. Friend for highlighting that important point. I would like a formal mechanism through which parents can share experiences and suggestions with the Government and the CSA. A kind of CSA users forum or a panel made up of non-resident parents and those with care could be initiated to feed back their experience regularly to Government. That would enable the CSA to improve its performance for parents with care and non-resident parents.

A major issue seems to be the CSA’s use of the deduction of earnings system. Non-resident parents complain that the CSA does not adequately monitor changes in their income or give them sufficient notice that a deduction of earnings is taking place. Deduction of earnings comes out of the non-resident parent’s pay before they see it, and the payroll department cannot make changes if anything is incorrect. Nothing can be done if an error has been made; the person paying the money has to claim it back and prove that errors were made, which can take years.

An absent father who lives in my constituency has never missed a payment. He was following the old rules, and then the departure was granted and he went on to the new rules. The CSA now says that he has arrears of £8,000, although he has never missed a payment. There appears to be a catalogue of errors, which are being investigated, including putting the wrong child’s name on correspondence, which causes unnecessary angst. The CSA is now taking £400 out of his wages per month for one child, which is ridiculously high. Because that money comes out of a deduction of earnings, the father has no say over the amount taken out—at one point, it increased considerably with no explanation. The situation has caused untold stress to him and his family, especially when the paperwork says that he should pay £42 a month.

Outstanding child maintenance arrears increased by almost £1 billion between December and March. If net weekly profit is over £100, £5 plus a percentage of weekly income in maintenance is payable. That may help to explain the complaint that non-resident parents often try to avoid paying child maintenance. The Government recognise that, and the Child Maintenance and Enforcement Commission has recommended a new scheme, which is at consultation stage. It would use HMRC-sourced gross annual income for the income child maintenance calculation. That method would reduce costs to business by £0.8 billion.

A major difficulty for the CSA occurs when the non-resident parent is self-employed. Self-employed status means that it is much more challenging to obtain accurate figures. Money cannot be taken at source or from a deduction of earnings. A case in my constituency has taken approximately 14 years. The parent with care is owed a considerable amount of money. The absent parent owns a number of properties, and a charge should be taken on his properties. Allegations have been made—I cannot confirm or deny them—that the absent parent has put his accounts into his partner’s name, so it appears as if he has no assets. I obviously do not know whether that is true, but it is clear that it is not a straightforward case.

--- Later in debate ---

[Caroline Nokes (Romsey and Southampton North) (Con)]

It is a pleasure to serve under your chairmanship, Mr Weir. I will endeavour to keep my comments as brief as possible, so that colleagues may also contribute.

As has been pointed out, the Child Support Agency is a recurrent issue in every MP’s mailbag. I would like to raise one key aspect of the reforms with the Minister: the family-based arrangements. We know from past failures that parental responsibility is key to any workable CSA reform. Parents should be encouraged to make their own arrangements, with minimal interference either from the CSA or from the courts, which of course should be the last resort for those whose separation is so rancorous or potentially violent that private arrangements are not possible.

Like the Government and Resolution, an organisation representing 5,700 family lawyers, I support the concept of family-based arrangements wholeheartedly. However, many family law solicitors are concerned that the Government’s objectives will not be achieved unless those arrangements are enforceable. That is not because lawyers are looking to feather their own nests, but because they have a duty of care towards their clients—a duty of care that the CSA sadly lacks and which unenforceable agreements simply do not fulfil. Lawyers will therefore be obliged to recommend that clients refer themselves direct to the agency or pay for a court order. Family lawyers assure me that, if the agreements were enforceable, the duty of care would be fulfilled and their uptake might be vastly increased. However, there is a risk that the number of couples making such an arrangement will be pitifully small, due to the inability to provide security or certainty.

One might be tempted to argue that a parent who wants an enforceable arrangement should simply pay the fee and use the agency or the courts, but I would argue that logic is flawed in both its economic and social consequences. In terms of social policy, while the fee could be sufficiently high to discourage or even prevent those who most need CSA assistance from getting it, in economic terms the fee makes no substantive contribution towards the real cost of agency services. That cost will not fall, as levels of case load will remain near constant, prompting one to ask what the purpose of the fee is.

The logical and pragmatic answer is to establish agreements that, if possible, bypass the CSA and the courts, yet are none the less enforceable. There are several ways to establish that. Perhaps the simplest option would be to lodge the agreement with the CSA and rely on the agency for enforcement, passing the full cost of collection on to the defaulting parent, not the parent with care. One would hope that would be a significant disincentive to default. Secondly, the arrangement could be lodged with the court, so that in the event of default, the parent with care would look to the court for enforcement. However, as with the CSA option, that has cost and, most important, significant time implications for parents in financial difficulties.

It is with some trepidation that I follow the hon. Member for Edinburgh East (Sheila Gilmore), who not only is a family lawyer but has significant experience of Scotland, because I am about to launch a suggestion that a further option could be to replicate the system north of the border. I will not repeat her comments, but will add to the information she has already provided. I contend that the system in Scotland is far superior to anything thus far proposed in England in terms of simplicity, cost and speed of recovery of moneys due. It might also hearten the Minister to know that it also avoids the need to have an argument over who should be charged.

As we heard, Scotland has long had the benefit of a registered minute of agreement, which does not need to go before either a court or the CSA, and works because it is summarily enforceable. Minutes of agreement are easy to draw up, so they are cheap; and when it comes to default on child maintenance payments, the parent with care does not need to go to the CSA, with its long-winded collection processes, or return to court to seek an order. When the money does not get paid, the parent with care merely asks the sheriff’s officers—roughly the equivalent of an English bailiff—to enforce the agreement. The defaulting parent then has his or her assets frozen in a process that a Scottish lawyer described to me as being “quick and muscular”. They then have a choice: pay the maintenance or go to court to try to have their assets unfrozen. The reality is that, due to its enforceable nature, the minute of agreement rarely has to be enforced, as parties know the harsh measures that can be deployed in the case of default.

I do not suggest that we can expect the entire legal system south of the border to be turned upside down and made to replicate Scottish law. There are certainly different understandings about the use of bailiffs, but we can surely import the key principle: that the agreement is enforceable, and is enforceable quickly and cheaply. How could we replicate the Scottish system? Changing and improving the collection powers and methods of the CSA is an option and should be looked at, but the courts will ultimately use bailiffs anyway, so replicating the quick and muscular nature of a Scottish minute of agreement within English family-based arrangements, perhaps by making them summarily enforceable, would enable solicitors to recommend them and, most important for the Government’s objectives, it might make parents actually want them.

I can see no better way to reflect the spirit of the original legislation and meet the Government’s objectives than with a family-based arrangement that is speedily enforceable. If someone is destitute and has hungry mouths to feed, an arrangement that is not enforceable is useless, and an arrangement that is enforced many weeks or months after default is next to useless. The best solution is an arrangement that is enforceable speedily and, best of all, at no cost to the parent with care.

--- Later in debate ---

[Mrs Anne McGuire (Stirling) (Lab)]

I echo the comments made by other hon. Members: it is a pleasure to be here under your chairmanship today, Mr Weir, for this short debate on the Child Support Agency. I congratulate the hon. Member for Loughborough (Nicky Morgan) on securing the debate, and hope she will agree that she was well supported in the contributions made by my hon. Friend the Member for Edinburgh East (Sheila Gilmore) and the hon. Members for South Derbyshire (Heather Wheeler), for South East Cornwall (Sheryll Murray), for South Swindon (Mr Buckland), for Romsey and Southampton North (Caroline Nokes) and, last but not least, the hon. Member for Gosport (Caroline Dinenage).

What we have heard today shows how complex child maintenance is. I listened carefully to the various cases with which MPs illustrated what they were saying. Frankly, no two of those cases were the same. If we multiply that by 650 MPs and multiply that again by the number of families who find themselves in a period of stress, perhaps we will appreciate the challenge that all of us face in trying to design a system that reflects all those individual situations. They range from the example that the hon. Member for South Swindon gave of the soldier in Afghanistan to the example that the hon. Member for Gosport gave of the disabled parent trying to keep her children. How do we come up with a system that deals with all those situations?

We should encourage more people to make voluntary arrangements. However, as my hon. Friend the Member for Edinburgh East—who is an expert on these issues—indicated, the people who make the voluntary arrangements are not the ones who need the state to intervene or facilitate. They are the people who come to what we could call an amicable separation and who understand that parenting, and the responsibility for parenting, is a joint effort, in terms of providing both emotional support and financial support. Sadly—and it is sad—not every couple can separate in that way. I think that it was the hon. Member for Romsey and Southampton North, who I understand may also have some experience in—

[Caroline Nokes]

indicated dissent.

[Mrs McGuire]

If the hon. Lady is not a lawyer, she should get a Bachelor of Laws degree, because she certainly sounded as if she had that sort of hinterland; studying an LL.B, perhaps part-time, might be an opportunity for her to take. Anyway, she highlighted some of the issues about how people try to manage these things.

Having said that, I must say to hon. Members that some of the situations that have been described today are hopefully not quite indicative of the changes that have happened in the CSA. I will just refer to a comment from a former Chairman of the Public Accounts Committee, which I think some hon. Members will probably agree with. The BBC reported:

“The public accounts committee said the CSA had a catalogue of complaints, a backlog of cases, and poor enforcement of uncollected payments”

and that the PAC said the CSA was one of the

“greatest public administration disasters of recent times”.

That was the view of the PAC in 2007, when it was under the chairmanship of the hon. Member for Gainsborough (Mr Leigh).

In May of this year, the PAC said:

“The Commission has made real progress in recent years but the challenges it faces”—

and hon. Members have illustrated some of those challenges today—

“in supporting separated families and securing maintenance payments for children are serious.”

So there have been significant changes, and the hon. Member for South Swindon remarked on the range of enforcement actions that exist and that were supported across the board; the Minister was in the House at the time. We had to realise that sometimes the carrot might not work and that sometimes it is about the stick. We can argue about whether six weeks is an adequate sentence, but the difficulties that people would face if they had their driving licence withdrawn, as well as all the other issues relating to enforcement, would really focus the minds of many people.

As a constituency MP, I have had nothing like the volume of CSA cases recently that I previously had. Ten years ago, I would have had a little queue of parents—both with care and non-resident—complaining about all the issues that have been highlighted today. I can now count on one hand how many live cases about the CSA that I have. I do not know if there is a particular problem in Loughborough, but I am just being frank with hon. Members in saying that I have seen a significant change. That is not to say that I do not occasionally have cases where somebody has had a wage deduction charge that has been wrongly applied—