Child Maintenance Service: Payment Recovery from Absent Parents

Peter Grant Excerpts

Wednesday 2nd October 2019 Westminster Hall

[Peter Grant (Glenrothes) (SNP)]

I beg to move,

That this House has considered the performance of the Child Maintenance Service in recovering payments from absent parents.

I would hope that everyone agrees that parents should continue to take financial responsibility for their children after the break-up of a relationship. We must understand that relationship break-up can often be a disturbing and distressing time for everybody, often leaving behind a great deal of bad feeling. It is not easy in such circumstances to come to an arrangement that is fair on both partners and, most of all, fair on the children. The criticisms that I will be directing today at the Child Maintenance Service, and its predecessor the Child Support Agency, should not be taken as an indication that I do not appreciate the difficult circumstances in which it has to operate.

Many absent parents do their best to care for their children, and I do not want to give the impression that everybody whose relationship has broken up is trying to avoid their responsibilities. Sadly, however, some people see the break-up of a relationship as an opportunity to abandon all responsibilities for their children. The Child Maintenance Service owes it to those children and to the resident parent to ensure that the absent parent complies with their legal and moral responsibilities. We are not talking about forcing somebody to pay to give their children a life of luxury. Indeed, we are often talking about forcing somebody to pay money that they can well afford in order to keep their own children out of poverty. The Child Maintenance Service is sometimes not good enough at getting money from people who can afford it, and we sometimes see it pursuing people for payments that they quite clearly cannot afford.

I am grateful to several organisations that have provided me with background information not only for this debate, but to support my caseworkers in dealing with a significant number of requests for help from constituents. Fife Gingerbread does an enormous amount of good work in my constituency and elsewhere in Fife. My caseworkers also find the Child Poverty Action Group’s child support handbook indispensable, and that will be the same in every constituency across these islands.

Several individuals have also shared their experiences with me. I do not have time to go into any of them in great detail, and some of cannot be aired in public for reasons of confidentiality. In addition, some of the issues that have been raised—serious though they are—do not really fall within the remit of this debate because they relate, for example, to the regulations around exactly how somebody’s income is determined, which causes a great deal of anger, sometimes among the paying parents and sometimes for the receiving parents. I make that point because it will not be possible to go into most of these cases in any kind of detail in the time available. I have also been approached by several colleagues who want to speak in the debate or to intervene, so I want to give time for that as well.

I see too many cases in which it is obvious that a parent is determined to avoid their responsibilities and that they can get away with it—sometimes for years at a time—which is just not good enough. It is far too easy, for example, to hide income from the Child Maintenance Service, which too often leaves it to the resident parent to produce the evidence that their ex-partner is effectively committing fraud. That is bad enough at the best of times, but if the resident parent has been the victim of domestic abuse or financially coercive and controlling behaviour, it is wholly unacceptable to make them responsible for ensuring that the other parent of their children complies with their legal responsibilities.

[Martyn Day (Linlithgow and East Falkirk) (SNP)]

My hon. Friend is making a powerful speech on an issue that I have raised in the past. Several constituents who are the resident parent have not received any money for years, and a common theme or trend seems to be that the paying parent claims to have given up paid work or become self-employed in order to hide their income. That totally thwarts the whole purpose of the Child Maintenance Service. Does my hon. Friend agree that the CMS must pull out all the stops to find a way to prevent that from happening, maintain its charter commitment and ensure that the child is at the heart of everything?

[Peter Grant]

Absolutely. I do not think we will ever have a set of regulations that everyone agrees with. If a relationship between two people has completely broken down, the one who is paying will think they are paying too much, and the one who is receiving payment will think they are not getting enough. Surely, if the rules are based on someone’s income, however, it should be no easier for them to hide their income from their children than it is to hide it from the Inland Revenue.

I have assisted constituents affected by HMRC loan charge, as well as a constituent who was pursued to a ridiculous degree for a relatively small debt that they turned out not to owe to HMRC. Many resident parents in my constituency would like a fraction of that diligence to be used by the CMS when it chases down money that is owed not to the Government but to children who often desperately need it.

[Jim Shannon (Strangford) (DUP)]

I congratulate the hon. Gentleman on securing this debate. Does he agree that more must be done to reconcile reported earnings with the lifestyle of the absent father or mother? I have seen parents in my constituency who give their child £10.50 a week, yet they drive a brand-new BMW, have the newest of gear and have that kind of lifestyle. An absent father must be allowed to live, but it should be difficult for them to disregard their financial obligations. We must make that more difficult.

[Peter Grant]

I agree with that entirely.

[Deidre Brock (Edinburgh North and Leith) (SNP)]

I congratulate my hon. Friend on securing this important debate. I have a constituent who is owed a substantial sum by an absent father, who lives very comfortably and flies in and out of the UK with no apparent difficulty. The only answer my constituent gets is that the service cannot touch him because it cannot establish a UK address for him. Does my hon. Friend agree that such cases need more than just ministerial hand-wringing, and that concrete action to seize passports or assets could be in order?

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[Peter Grant]

Absolutely, and I will come on to some of the new powers that have recently been given to the Child Maintenance Service. Although those powers are draconian, there will be instances when they have to be used. Deliberately concealing income from people who you know want only to provide for your children should be a criminal offence. It is not a matter for the civil courts or for civil adjudication. If someone falsifies their tax returns, they go to jail, so if they falsify returns provided to assess their financial liability for their own kids, they should also go to jail.

[Rachael Maskell (York Central) (Lab/Co-op)]

I have a constituent who has not received payment for years. Their former partner has moved home and jobs, and keeps changing bank account. They also disposed of two properties, yet that money is untraceable. Surely people should not be able to open new bank accounts if they owe all that money.

[Peter Grant]

Again, I entirely agree. I have had female constituents who use one name in their family and one in their professional work. They have difficulty opening two bank accounts, so it seems strange that others are able to get away with opening bank accounts all over the place.

Last year the powers available to the Child Maintenance Service were extended. I found it concerning to read the evidence submitted to the Work and Pensions Committee in 2016, because it seemed that the Department for Work and Pensions did not understood the difference between collection powers and enforcement powers. The DWP can implement collection powers immediately through the Child Maintenance Service—it does not need anybody’s permission—but enforcement powers are more severe and need the consent of the courts. If those who write the evidence for a parliamentary Select Committee are vague about the distinction between those two powers, it is no wonder that parents and children who are waiting for their money sometimes get confused about what the powers are.

Some powers that the Child Maintenance Service has should not be allowed as a form of debt enforcement, and even in certain cases I do not think that imprisoning someone for not paying their dues is acceptable. It should be an imprisonable offence if somebody falsifies information, but not if they refuse to pay money that has been established as owed. I certainly would not want any seizing of property, warrant sale or auction to happen in Scotland. One of the first private Members’ Bills put through the Scottish Parliament was to outlaw what I believe to be a barbaric practice. In a civilised country, there are other ways to carry out debt collection, without such draconian and barbaric actions. For example, we could restrict someone’s ability to open new bank accounts.

[Ruth George (High Peak) (Lab)]

Will the hon. Gentleman give way?

[Peter Grant]

I need to make a bit of progress. If I have time later, I will give way to the hon. Lady. I am grateful for her interest in the debate.

Something that has been a major concern for many of my constituents recently is the Child Maintenance Service’s decision to write off debts that somebody has been owed for a significant time. Sometimes that is a relatively small amount of money, but it can open up all the old wounds again if the parent who is owed that money suddenly gets a letter from the CMS after 10 years, having heard nothing from it, as happened to one of my constituents recently.

Another constituent has been asked to agree to writing off a debt of £18,000 that she is owed for the children she has raised on her own. Her children are now grown up, and people could argue that they do not need the money, but the person who owes the money certainly does not need it. I do not think that is acceptable, any more than it would be acceptable for the HMRC to decide not to bother chasing somebody who owed £18,000 of tax. In the case I have referred to, the Child Maintenance Service knows where the absent parent is. It knows where he lives, it knows where he works and it knows his bank account details, so there is no excuse whatsoever not to require him to enter into some kind of arrangement to pay his children the money he owes.

[The Minister for Disabled People, Health and Work (Justin Tomlinson)]

On that specific point, they will have been contacted. If that information is available and they would like that £18,000 debt to be pursued, it would be, and it would be a priority.

[Peter Grant]

Interestingly enough, when I contacted the Child Maintenance Service about that specific case, it promised to give us a fuller response by 3 October, so it has about 20 minutes left. If we finish a wee bit early, the Minister might be able to get on to his colleagues and ensure that they honour that. Of course, it may be that they have responded during the time that I have been on my feet.

Far too often, the parent who has the main responsibility for looking after the children physically is left to fight battle after battle with the CMS to get the money that is theirs and their children’s by right. Often, they feel as if the CMS is not working with them, but is almost acting as an obstacle to them. Far too often, when I look through the cases that have come in to my office since I was elected, the final point is that the parent has just given up and feels it is not worth chasing things up. Very often, they can no longer stand the stress of being forced to continue to contact somebody who, quite frankly, they never want to hear from again because of the way that person treated them while they were together. It is not only a tragedy, but a scandal, if somebody is forced to give up the fight for what they are legally entitled to simply because a Government agency has not supported them enough in the process.

[Ruth George]

I thank the hon. Gentleman for securing this important debate. Like him, my caseworkers and I have found it incredibly frustrating to try to get through to the CMS, both in cases where there is a claimant making a claim and where the CMS holds wrong information on a defendant. Just trying to get the CMS to look at that is very difficult. Does he agree that the fact that universal credit now takes account of maintenance income, whether or not it is received, will make recipients who are due that money even poorer if they do not receive it, and that that is a double whammy for them and often for their children as well? It just adds to the injustice of the situation.

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[Peter Grant]

The hon. Lady makes a valid point. Those of us who are old enough to remember it would do well to recall that the original version of the Child Support Agency was set up not to help the children, but as a way of getting somebody else to pay the children’s maintenance costs to save the DWP or its predecessor a wee bit of money. That legacy can be seen sometimes in the fact that the CMS, through the DWP, is simply not as enthusiastic about pursuing money that is owed to other people as it would be if it were pursuing money owed to itself.

[Stephen Timms (East Ham) (Lab)]

Will the hon. Gentleman give way?

[Peter Grant]

I think I can give way once more, and then I will have to move on.

[Stephen Timms]

I was looking through my records this afternoon, and I saw that I wrote to the Child Support Agency on behalf of one of my constituents on 30 September 1999. She finally received a first, partial payment on 1 August 2018. It took 19 years. Is the hon. Gentleman as unsurprised as I am that people, as he says, just give up?

[Peter Grant]

I just wish that I could wait 19 years before paying the bills that come into my constituency office with more regularity. I would love to think that the example the right hon. Gentleman raises was unique, but I do not think it is. What is the point of a child maintenance system that does not pay anything to the child until they are 18 or 19 and have left school, and possibly left home and gone to university? The children need the money when they are two, three and four years old, not when they are in their 20s. In a case I mentioned earlier, the children were literally grown up and had left home. Some were married, some were at university. As a point of principle, the parent was determined to carry on fighting, but he knows perfectly well that the money will not make any difference to his children. They have had the experience of being brought up when money was desperately tight.

A completely incomprehensible aspect to the write-off scheme is that the process the Child Maintenance Service has to go through before it can write off historical arrears depends, reasonably enough, on the level and value of the arrears, but that, by its own admission,

“significant policy, operational and IT issues beset the 1993 and 2003 schemes which contributed to the build-up of considerable arrears of unpaid maintenance”.

In another document, it admitted that it cannot always be sure how much the arrears are. How can it be fair for the CMS to say that it can write off an amount of arrears because it is small enough within the scheme that it does not need the receiving parent’s permission, and at the same time to say, “We don’t really know how much the arrears are, because our record-keeping system was so appalling in the past”?

A great deal more could be said, but I know that colleagues want to speak as well, so I will bring my comments to a close. First, however, I want to add something that was not in my original speech. I decided to do that when I realised that, while we are having this debate, our colleagues in the main Chamber will, hopefully, be agreeing to the Second Reading of the Domestic Abuse Bill.

I cannot go into much detail about some of the cases I have had, because people are still under threat from ex-partners, but I hope the Minister can explain how someone whose partner has been convicted repeatedly of assault can hide their income from the Child Maintenance Service for more than three years after the CMS has been alerted to where the money was, where it was going and how it was being hidden. It was hidden in such a way that, if I had the same authorisation to visit premises and to make inquiries as the CMS and HMRC, I could have found it, as any of us could, within 20 minutes. It was not an elaborate offshore scheme; it was a very simple accounting practice that HMRC and the Child Maintenance Service know about.

How can it be that someone who has been and still is a victim of coercive financial control is told that it is entirely up to her to find evidence that her ex-partner is committing fraud against her and probably against HMRC as well? How can that be acceptable? Why is the Child Maintenance Service not working more closely with HMRC, so that when they get information that points clearly to a large-scale criminal evasion of tax by somebody whose address and place of work is a matter of public record, they can take action? How can it take three years for them even to begin an investigation? When the Minister sums up, I hope he can answer that question, as well as responding to the other comments I have made.

[Several hon. Members rose—]

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[Peter Grant]

I realise that I must be very brief, so I thank everybody who has contributed to today’s debate. A couple of points: first, people do not need a clever accountant to hide their money; they only need an accountant who knows how to set up a private limited company, and it then takes years to find it. Secondly, we do not need to be Sherlock Holmes to find these scams; we only need a Facebook account, and then we can see the luxury yachts, the holidays, the umpteen fancy houses and so on. If somebody on benefits was boasting about their wealth to that extent, the DWP would have them very quickly. That is the speed at which we should be chasing down money from other people as well—