Question to the Department for Work and Pensions:

To ask the Secretary of State for Work and Pensions, what assessment her Department has made of the potential impact of Child Maintenance Service late payment fees being deducted from maintenance payments on receiving parents and children.

The Child Maintenance Service (CMS) does not charge late payment fees. It does charge fees to paying parents and receiving parents who are on the Collect and Pay service: twenty per cent on top of the maintenance liability for the paying parent and four per cent of the maintenance received for the receiving parent.

A case will only be moved to Collect and Pay if the paying parent agrees to Collect and Pay, or if they demonstrate an unwillingness to pay their maintenance liability. This is why paying parents are charged a higher fee (20 per cent) as they have more control on whether the case is put into Collect and Pay. The collection charge is only deducted when the maintenance is paid.

In July 2024 the government consulted on the proposal for wider reform to consolidate the CMS into a single service type where the CMS monitors and transfers payments. The consultation Improving the collection and transfer of payments, also proposed a new fee structure of just 2% for receiving parents, deducted from maintenance received; 2% for compliant paying parents, on top of maintenance owed; and 20% for non-compliant paying parents, on top of maintenance owed. The consultation received over 2,700 public responses, and engagement from stakeholder organisations across the UK in addition to commissioning research to help quantify the impact of the reforms.

The Government published its response to the consultation on the 23 June setting out its intention to proceed with reform of the system. More information can be found at Government response: Child Maintenance: Improving the collection and transfer of payments - GOV.UK