Question to the Department for Work and Pensions:

To ask the Secretary of State for Work and Pensions, what alternative approaches to reforming Direct Pay have been considered, and how his Department will ensure that children do not lose out financially as a result of any changes.

Evidence gathered by the Department has highlighted significant shortcomings with Direct Pay. Under Direct Pay, the CMS is unable to routinely monitor whether payments are being made in full or on time, meaning non-compliance can go undetected until a parent reports a problem. Research tells us that only 60% of receiving parents in Direct Pay reported getting all of the child maintenance they are owed, and only 40% of them reported receiving it always on time. This places the burden on receiving parents to chase payments. The current arrangement can also create opportunities for economic abuse, including situations where maintenance is withheld, paid late or manipulated as a means of exerting control over a former partner. In many cases, parents may also need to maintain contact with an ex-partner to resolve payment issues, which can be distressing and particularly harmful for victims and survivors of domestic abuse.

However, moving to a single service where the CMS monitors and transfers payments will address these longstanding issues.

Our proposals for the new service will be underpinned by a fairer fee structure. Fees offset the investment needed to make the reforms and contribute to the cost of using enforcement powers to re-establish compliance and reduce the burden on the taxpayer.

We considered how best to address the shortcomings of Direct Pay and concluded that a single service model, with CMS oversight of all maintenance payments, would provide greater transparency, improve compliance and better support children to receive regular maintenance.