Orders of the Day — Child Support, Pensions and Social Security Bill

House of Commons, 29 March 2000.

PRIORITY COLLECTION AND ENFORCEMENT OF CHILD SUPPORT MAINTENANCE

Eric Pickles (Conservative, Brentwood and Ongar)

I beg to move, That the clause be read a Second time.

Betty Boothroyd (Speaker, West Bromwich West)

With this it will be convenient to discuss the following: New clause 5—Deduction of earnings orders— '.—There shall be substituted for section 31(3) of the Child Support Act 1991 the following— (3) A deduction of earnings order shall be made so as to secure the payment both of arrears of child support maintenance payable under the maintenance calculation and amounts of child support maintenance which will become due.".'. Amendment No. 89, in clause 16, page 14, line 41, at end insert— '(1A) After section 39A of the 1991 Act there shall be inserted— .—(1) In either of the circumstances mentioned in section 39A(1) the magistrates' court may of its own motion order such of the measures mentioned in (2) as it thinks fit. (2) The measures mentioned in (1) are— (a) an order that any welfare benefits that the liable person is in receipt of at the time of the application be reduced by such amount as the Court thinks fit; (b) a warrant of execution in respect of any goods owned by the liable person; (c) a home detention curfew of like effect to an order as could be made under the Crime and Disorder Act 1998 or; (d) a community service order. (3) When making an application under section 39A the Secretary of State shall provide to the magistrates' court a statement setting out which welfare benefits the liable person is in receipt of and the amounts thereof.".'. Government amendment No. 40. Amendment No. 76, in clause 19, page 20, leave out lines 15 and 16 and insert— '(i) a maximum of 20 per cent. of any relevant benefit received by the parent for the first six months; (ii) a maximum of 10 per cent. of any relevant benefit received by the parent for a remaining twelve months; and the maximum period, without possibility of extension, is eighteen months.'.

Eric Pickles (Conservative, Brentwood and Ongar)

I am sorry. I nearly got to my feet when the order of consideration motion was moved formally, Madam Speaker. Members nearly had the opportunity to hear my speech twice. These matters relate to enforcement. We are here to help the Government to meet their straightforward promises. The other night, I had the pleasure of seeing the Minister of State in the Lobby. He asked whether I had been reading any interesting books with which I might entertain the House. Indeed I have. I had the opportunity to read a Labour party document that was first published in October 1996, entitled "Children First: Reforming Child Support". It is pretty thin on plot, but it is the progenitor of the Child Support, Pensions and Social Security Bill. Given that I am also interested in the cinema, I could say that if that document was the novel, the Bill is the screenplay. As in most cases, there is a considerable difference between the novel and the screenplay. We want to go back to the Labour party's original proposals. The document makes the following clear statement: We will insist that the agency reaches demanding targets to protect taxpayers' interests. We would all applaud that. It continues: Our initial target will be to ensure that an additional 100,000 absent parents pay maintenance. That is exactly what new clause 4 seeks to achieve and would be in the interests of the Child Support Agency. When the Bill becomes law, two systems will operate concurrently. Tonight, we shall be asked to approve a system that will force parents to make payments that we consider to be essentially unfair, as the old system will operate side by side with the new one. The true beneficiaries—not the intended ones—will therefore be those who have paid nothing. We want to ensure that those who have made and continue to make contributions are not made out to be mugs. Parents who have obeyed the law and sought to meet their obligations must not be placed at a disadvantage compared with those who have attempted to evade their responsibilities. New clause 4 seeks to wipe the smiles off the faces of parents who have not taken financial responsibility for their children. I quote with approval the document "Children First: Reforming Child Support" which states: We start with the basic principle that parents, not the taxpayer should have the main responsibility for supporting their children. Parents who bring children into the world must accept that they have a responsibility. They have an obligation to look after their child until adulthood and to support that child financially. Amendment No. 89 deals with curfew orders and other matters. On Second Reading there was a certain amount of criticism from all parts of the House of the Government's proposals to take away people's driving licences if they committed an offence under the Bill. Not a single speech—not even from the most loyal Back Bencher—said that that was a good idea. There was an earlier suggestion that people's passports should be taken away also, but that idea has been dropped from the Bill, perhaps owing to the mess in the UK Passport Agency. The Minister of State, Home Office might have ended up taking away everyone's passport. I recall my hon. Friend the Member for Havant (Mr. Willetts) once receiving a briefing about the Medellin cartel, a drugs cartel that operates in Colombia. Someone in one of the five accountancy firms used by the cartel was leaking information about the cartel. The cartel could not work out which accountant was leaking, so it decided to execute all five of the accountants involved in its affairs. Although I am sure that, whatever we may think of our accountants, we all agree that that was an overreaction, the point is that the Government seem to be diminishing the value of removing passports as a penalty by failing to issue them initially. The problem with the Bill is that it provides for no penalties other than a fine and/or imprisonment and loss of driving licence. Amendment No. 89 provides new penalties, thereby allowing flexibility. The amendment is essentially similar to an amendment that I tabled in Committee—I see the Minister nodding vigorously. That amendment briefly took her fancy—she thought that it might be a good idea—until she got back to the Department, where it was discussed. I received a nice note back saying that it was not the Government's policy to make such a provision. I shall come back to that matter in a few moments, because I think that the Government are making a mistake. Our proposal would provide flexibility. The proposal to remove driving licences has been heavily criticised. In a letter to my hon. Friend the Member for Havant, Mr. Jonathan Simpson of the RAC makes four principal criticisms of the proposal. I shall summarise the points, as it would be tedious to read them out. He says that there has always been a case for disqualifying motorists as a penalty for motoring offences such as dangerous or bad driving. Such a penalty is directly related to the offence, and is therefore obviously justifiable and acceptable in the eyes of the public. However, as the RAC points out, failure to comply with a maintenance order is an entirely different matter. The RAC is concerned that the application of the penalty in maintenance cases will be the beginning of a slippery slope, and that the penalty will in future be applied to various non-driving offences. The RAC goes as far as to suggest that a motorist could face disqualification for dropping litter. The RAC also believes that removing someone's driving licence could end that person's ability to earn a living. Not unreasonably, the RAC concludes that application of the penalty could reduce those people's prospects of being able to make regular maintenance payments. If people cannot commute to work or perform their duties at work because they no longer have a driving licence, their ability to provide reasonable sums will be diminished. The RAC makes another suggestion, for which I have no sympathy. It says that the provision may well cause an increase in the number of those who drive a motor car while disqualified. That may or may not be true. However, I do not think that such a possibility is a valid reason for suggesting that the provision should not be made. We criticise the provision quite simply because it lacks flexibility. Additionally, it seems ridiculous to place on the same level the penalty of loss of driving licence and the penalty of fine and/or imprisonment. The Bill makes loss of licence an alternative to imprisonment, not an addition to it. Our proposal extends the range of available penalties. We are praying in aid the Prime Minister's suggestion that electronic tagging should be extended to domestic violence and stalking offenders. Frankly, it is a natural extension to apply the measure to the Child Support Agency to get getting people into the habit of paying and acting responsibly. An article on 7 September in "Justice of the Peace" asked whether it was necessary or desirable to keep an offender away from undesirable associates at, for example, football matches, rallies or clubs. Essentially, the proposal is for a curfew order: we are saying that someone will not be able to go to football on a Saturday afternoon, pour their earnings down their throats or go clubbing at the weekend. The offender's first call will be his child maintenance payments. The article asked also whether the offender indulged in irresponsible leisure activities. The proposal is part of an established pattern of getting people to accept their responsibilities. The Minister has said that the Government do not want to start mixing criminal and civil sanctions, and that they would not table an amendment to that effect. I am used to accepting disappointments, but the House will be disappointed too.

Andrew Dismore (Labour, Hendon)

Amendment No. 89 states that the court has the power to reduce the amount of benefit that someone may have to pay. The hon. Gentleman's intention is to get people to pay more, but his proposal effectively encourages people who want to put off paying, as they will always think that the magistrates court will bail them out in the end—particularly bearing in mind the fact that there is no provision in the amendment to allow the parent with care to make representations to the magistrates court. Is not the amendment effectively creating an appeal to the court through the back door?

Eric Pickles (Conservative, Brentwood and Ongar)

No, it is not. It is an attempt to make some sense of the Bill, and to offer the courts the opportunity of a wider range for breaches of sanction, other than imprisonment or a fine. After all, these matters would apply only where there was an application for default. This is not something that will arise in the normal course of events in which the parent with care and the non-resident parent discuss the financial future of their children. It will come into play where someone is in default. The amendment is not a way in which the non-resident parent can apply through the back door. It gives the courts a greater degree of flexibility, and seeks to strike a balance and to ensure that someone gets into the habit of regular payment, gets back to a degree of social responsibility and recognises that the Child Support Agency is not a soft touch. Under the legislation as drafted, people have a choice between losing their driving licences or going to jail. I suspect that most people will opt to lose their licences. After all, people who are not in the regular habit of using a motor vehicle might consider that to be a way of getting off scot free. We are seeking to achieve a balance. The new clause is not set in stone, as it might not work exactly as we hope. It has been tabled to stimulate debate and to get the Minister to expand on her letter to me. However, I hope that she will accept that our intention is to extend the enforcement powers of the CSA, not to give people a way out by the back door.

Frank Field (Labour, Birkenhead)

The whole House wants the reform to work, so I am anxious to know what the hon. Gentleman is proposing. Does he mean to establish a menu of penalties that the CSA could use, or is he proposing that the CSA must take certain actions in certain circumstances?

Eric Pickles (Conservative, Brentwood and Ongar)

The right hon. Gentleman's first suggestion is what we want to achieve. We want to extend the menu of actions available to the CSA. At present, there are only the extremes of losing a driving licence or going to prison, with the option of a fine somewhere in the middle. We want a graduated scale. Clearly, curfew orders will not work unless there is a reasonable anticipation that the people involved will abide by them. However, the Government are researching ways to extend such orders beyond their original application, which was as a way to help offenders released on licence to prepare to return to society. It is extremely sensible to take into consideration domestic violence and stalking.

Simon Burns (Conservative, West Chelmsford)

I have been listening to my hon. Friend extremely carefully. The new clauses rightly make suggestions about how to strengthen the encouragement given to people to pay child maintenance. However, I am slightly worried that there is another side to that coin, involving a parent who pays the maintenance but who does not have access to the children of the relationship. Does my hon. Friend think that the Bill should tackle that equally important issue?

Eric Pickles (Conservative, Brentwood and Ongar)

A later group of amendments deals with the relationship between the non-resident parent and the parent with care. However, my hon. Friend is right to express concern that the Bill might well cause children to find themselves caught between parents feuding over financial matters. The Bill draws questions of access and finance close together, and means that it could be in one party's financial interest to keep a child over on a Sunday evening and to take it back to school on the Monday, rather than returning it to the other party on the Sunday night. My hon. Friend has made a valid point about access.

Frank Field (Labour, Birkenhead)

Am I right in thinking that the Opposition are proposing to add to the range of measures that CSA officials would have at their disposal to enforce the legislation when it is enacted?

Eric Pickles (Conservative, Brentwood and Ongar)

The right hon. Gentleman is nearly right. Under the terms of amendment No. 87, CSA officials would have to apply to the court for enforcement of the proposed options. Excellent though the CSA is, anything else would be a step too far. I commend the new clause and the amendment to the House.

Simon Burns (Conservative, West Chelmsford)

I rise to support new clause 4. I should like to describe the criticism that I have heard most often in constituency surgeries over the past eight years or so, whatever the views on the Child Support Act 1991 and on the Government's reforms before us today. The parent who pays child maintenance and complies with the Child Support Agency's assessment feels that he is a soft target because he does not seek to hide his financial responsibilities, whereas, in the early days, an organised, hard-core group sought to bring the child maintenance system to a grinding halt through their obstruction of the operations of the original CSA and to avoid paying any child maintenance whatever. New clause 4, which would strengthen the powers of the CSA, is eminently sensible. It would take away the sense of unfairness and special targeting felt by a group who do not want to cause trouble and want to make a financial contribution to their children's upbringing.

Andrew Dismore (Labour, Hendon)

I am listening with interest to the hon. Gentleman. May I put a hypothetical question to him? What is the position of a person who pays £1 or £2 a week but is liable to pay considerably more and could therefore accrue substantial debts, as compared with a person who has to pay only a small amount in the first place and does not pay any? Which case does the hon. Gentleman think should be pursued first? The new clause suggests that the person to be pursued is the one paying nothing who has only a small amount to pay, whereas someone with a huge amount to pay could effectively avoid being caught by this proposal by paying a token amount.

Simon Burns (Conservative, West Chelmsford)

The hon. Gentleman has raised a third issue. I was coming on to the issue of parents who pay. The person who pays nothing should be pursued because he is seeking to avoid all his financial responsibilities. Similarly, if an individual is playing the system at a minimal level to try to avoid his full financial responsibilities, he must also be pursued by the CSA. The trouble with any legislation that contains an either/or option is that some people will seek to use the existing law to maximise their abuse of it, and we have here an example.

Eric Pickles (Conservative, Brentwood and Ongar)

rose—

Simon Burns (Conservative, West Chelmsford)

If my hon. Friend wishes to tell us of another one, I shall give way to him with pleasure.

Eric Pickles (Conservative, Brentwood and Ongar)

I was merely going to suggest that that is one of the advantages of such a matter going before the courts. The courts would take the view that such a person was attempting to get round the system. Someone who doles out £1 or £2 a week is playing around. That example further strengthens the need for the new clause.

Simon Burns (Conservative, West Chelmsford)

My hon. Friend is absolutely right. We have all had examples over the past eight or nine years of people who have played the system, or sought to play the system, to avoid their financial responsibilities. There is one point on which I am confused, although I am sure that my hon. Friend the Member for Brentwood and Ongar (Mr. Pickles) is not. I should like clarification. To give priority to those individuals who make no financial contribution above those who are making a full and proper contribution must not also mean that the administrative systems of the CSA fall behind, thus inadvertently causing problems for those who want to pay the full amount, but are still awaiting assessment for payment, or waiting to have an assessment confirmed.

Frank Field (Labour, Birkenhead)

Does not the new clause have one real disadvantage? Let us take our mind into the next Parliament, where I expect that the hon. Gentleman will still be sitting on the Opposition Benches and Labour will be on the Government Benches. The Opposition will be looking for the amount collected under the new Act. If we pass the new clause, one of the covers available to the Government would be that maintenance payments—or the rate of collection—had gone down because the Government were following the instructions given to them by the Opposition in the previous Parliament: that we should chase those from whom it is most difficult to obtain money and de-prioritise those from whom we can most easily get maintenance payments. Does the hon. Gentleman realise that?

Simon Burns (Conservative, West Chelmsford)

I understand what the right hon. Gentleman says. However, in practice that need not be true, although there is certainly a danger that it may be. If the CSA is properly staffed and managed, the problem would not necessarily arise. It remains to be seen whether the reforms will work, but the Government maintain that the system will be so much simpler and so much more transparent than the old one that the previous problems in administering it will not occur. They argue that those who have to pay child maintenance will understand what they are being asked to pay and that the complicated formula that we set up—believing that it would be fairer on parents—will be cut away. The system should be easier. According to that argument, CSA staff should be able to handle their work load more easily because of the simplification and transparency of the system. A disproportionate amount of time and effort would not thus be spent on chasing the obstreperous or the non-payer. There would be a two-track system. It remains to be seen whether that happens—as with so many matters in the relatively short history of the CSA. However, we must lance the boil that has caused so much agony and antagonism among so many parents who have held out, delayed and refused to pay for such a long time. Even if the new clause needs some improvement—with Government help—it would be a positive step forward in improving the legislation.

Steve Webb (Liberal Democrat, Northavon)

Amendment No. 76, tabled by my hon. Friends and me, relates to the position of women who do not want to name the father, and to their concerns about violence. That is an important issue on which my hon. Friend the Member for St. Ives (Mr. George) hopes to speak if he catches your eye, Madam Speaker. In my contribution, I shall respond to the amendments and new clauses tabled by Conservative Members. They raise some important issues. The spirit of new clause 4 appears to touch that raw nerve about which we have all heard in our surgeries—the fathers who say, "I pay and I'm being chased, but I know someone else who doesn't pay a penny and he seems to be left alone." For the reasons that have been given—including the intervention of the hon. Member for Hendon (Mr. Dismore)—the new clause is problematic. How will the prioritisation work? Would people who paid something be left alone, and would that cause problems? It is hard to see how that form of words would work. However, the Conservatives raised one general issue to which I should like to hear the Minister's response. What are the targets set for the agency? As with so many Government targets, do they distort priorities in a way that we would not want? Just as the infant class size target has distorted junior class sizes, and just as the in-patient waiting list target has distorted out-patient waiting lists, is there a danger that targets expressed in amounts of maintenance collected will distort by encouraging the CSA to chase those who are most easy to chase? 4.15 pm I am genuinely uncertain about the targets and incentives that the CSA is set. Will the Minister assure the House that such incentives will encourage the CSA to chase non-payers—such as one requiring it to increase the percentage of people who are paying any amount—as much as they do to increase total maintenance collected? I hope that she can offer that reassurance. In the absence of such provision, the problem that the Conservatives have raised will continue. Many fathers who are doing their best to pay legitimately feel that others are getting away with doing nothing. New clause 5 refers to deduction of earnings orders. I did not catch much reference to its aims in the speech of the hon. Member for Brentwood and Ongar (Mr. Pickles). I am not entirely clear what it would achieve. I would be happy to take an intervention from the hon. Gentleman if he wants to elaborate on the matter.

Eric Pickles (Conservative, Brentwood and Ongar)

The new clause simply tries to improve the way in which deduction of earnings orders are levied. It is no more complicated than that.

Steve Webb (Liberal Democrat, Northavon)

I am grateful; I had assumed that, although how it would do so is still not clear to me. My main concerns relate to amendment No. 89 and the long list of seemingly draconian measures to pursue non-payers. I notice the term "curfew" popping up and various other quite serious penalties for non-payment. I find myself asking in what respect is child support debt different from other debt. That is a fundamental question. Most of the specific penalties, such as the withdrawal of driving licences and the imposition of curfews, that we are introducing for child support debt would not apply to any other debt. If I, as a tenant, owed a former landlord some money, I could be pursued through the courts by a deduction of earnings order and various other measures, but he could not apply to the court to put me under a curfew. Why would someone owing money in one sphere be subject to draconian attacks on liberties when someone owing money in another sphere would not be so? I am not sure that child support debt is different in substance, which is why I have reservations about the application of such penalties only to such debt. It could be argued that the taxpayer has an interest. If so, there may be a case for restricting the imposition of such severe penalties to cases that result in the public purse losing out—although there is no indication of that in the amendment. I am not convinced that the case has been made for those very severe penalties to be applied peculiarly to child support debt. No argument has been made that it is so different from other debt. I am sure that we would not want to apply such sentences to other debt. We very much sympathise with the spirit of new clause 4. Although its provisions would not work practically, we would like to hear from the Minister an assurance that the agency's targets recognise the genuine public concern about people who do not pay and give it an incentive to chase such people just as hard. I hope that my hon. Friend the Member for St. Ives will be able to address our concerns about women who fear violence.

Desmond Swayne (Conservative, New Forest West)

I shall address the point raised by the hon. Member for Northavon (Mr. Webb): in what way does the offence of owning child support debt differ from offences of owing other debt? I would say that the difference is this: child support debt is the most unnatural of crimes. We are talking of people who are not prepared to make provision for their own children. Therefore, I entirely understand the Government's desire to impose such strange punishments as the withdrawal of driving licences. I entirely understand the motive that lies behind the introduction of a new order of penalty to deal with a specific and unnatural crime. My difficulty with the penalty is that it introduces a new principle into our criminal justice system. In this country, the penalties available to punish miscreants are generally understood. The principal ones are the deprivation of liberty, the deprivation of finance through fines and the deprivation of time through the imposition of community service orders. Withdrawing a driving licence is of a different order because the penalty would not effect everyone in the same way that the deprivation of liberty or the removal of finance or time does. Some people who owe child support debt do not possess a driving licence or own a car. Therefore, the ability to withdraw a driving licence would affect them differentially from other people. It would have no impact on them at all. I prefer amendment No. 89 because it would provide a menu of penalties that would affect the miscreants in a way that is appropriate and consistent across the board. We had this discussion in Committee when we debated benefit withdrawal and the Government quite rightly responded to our suggestions that we should withdraw benefit by saying, "Ah, but what about those people who do not receive benefit? They would be affected differentially. That would be unfair and unjust." I suggest that exactly the same argument applies to the desire to withdraw a driving licence. The menu of penalties in amendment No. 89 is far preferable.

Andrew George (Liberal Democrat, St Ives)

My hon. Friend the Member for Northavon (Mr. Webb) spoke to amendment No. 76 and, depending on the Minister's response, I wish to flag up our desire to hold open the possibility of pressing that amendment to a separate vote. The benefit penalty applicable to parents with care who refuse to divulge information about a former partner has been set at 40 per cent. for a number of years and it can apply to someone for an indefinite period. As I understand it, the Government intend to continue that approach. The amendment would restore the position to what it was when the benefit penalty for non-disclosure was a 20 per cent. maximum reduction for the first six months and a 10 per cent. maximum reduction for the ensuing 12 months with no possibility of extension beyond the total 18-month period. There are several arguments against the withdrawal of benefit at a 40 per cent. rate. I welcome the Government's general claims and their obvious commitment to prioritising the ending of domestic violence, but they seemed determined that women who seek to avoid domestic violence should be coerced into financial dependence on violent partners. Amendment No. 71 has to be read in conjunction with amendment No. 81, which we shall debate later. I appreciate that the Minister objects to my comments, but matters of deep concern are involved. Assurances given by Ministers need to be deepened to reassure the many organisations concerned about domestic violence that the CSA will be able to deal effectively, robustly and sensitively with these difficult issues.

Desmond Swayne (Conservative, New Forest West)

We rehearsed those arguments in Committee, but I fear that the amendment in the hon. Gentleman's name would let off the hook the worst category of father: those who threaten physical violence. By providing that means of escape, we are accommodating the problem rather than trying to tackle it.

Andrew George (Liberal Democrat, St Ives)

I appreciate the hon. Gentleman's comments. It is a question of getting the balance right. Many domestic violence cases lead to the murder of women, but there are also organisations that, rightly, campaign on a broad front to ensure that women do not make malicious and trumped-up allegations to avoid the father having contact, although I realise that that point is different from the one made by the hon. Gentleman. How many more murders resulting from domestic violence need to take place before people appreciate the need to tighten up the legislation further? I hope that we will explore this argument a little more in the debate on amendment No. 81. Men may make violent threats in an attempt to get out of their responsibilities, but violent threats are followed through with tragic results, as we have seen far too often. Amendment No. 76 is an anti-poverty amendment, and has to be read alongside amendment No. 81. There are four strong arguments against the Government's proposal for a benefit penalty. First, it will push children into poverty. The case is as simple and clear-cut as that. A 40 per cent. reduction in benefit for a single parent pushes the family's income 40 per cent. below the income support level. How does the Minister view that in the light of the Government's honourable efforts in establishing the social exclusion unit and their key priority to reduce and remove childhood poverty? The proposal will clearly work against that. The proposal will penalise the children whom the child support system is designed to support. If a low-income family loses income, everybody in the family suffers. The Government will be unable to prevent the parent with care from intentionally or unintentionally making the child bear the burden of that income loss. These are the people who can least afford to lose income. Two thirds of children in one-parent families in the UK are poor, compared with a quarter of children in two-parent families. Income support is set at a level that is supposed to be the absolute minimum for survival, but the Government propose to push families below that level. Secondly, and equally importantly, non-disclosure is not necessarily an indication that the parent with care is taking money on the quiet from the non-resident parent. Although there will be fraud in the system, it is wrong to approach the issue on the assumption that everybody who, by commission or omission, does not fit into the normative scenario is on the fiddle. The Government have never produced evidence to support that assumption. Thirdly, there is no evidence that the punitive approach has succeeded. The last increase in the severity and length of the benefit penalty was accompanied by a significant increase in non-compliance. The penalty particularly hits lone parents who believe, for whatever reason, that it is not in the interests of their children to co-operate with the CSA. Slapping a benefit penalty on them is unlikely to change their minds; it will drive them further away from the system. 4.30 pm I shall cite two case studies in support of my argument. The first involves a lone parent who suffers agoraphobia and depression as a result of repeated assaults by her ex-husband, to whom she was married for 10 years. She also suffers from dyslexia. Until she sought advice, she was completely unaware that there were any exemptions from the requirement to co-operate. Her ex-husband still has some contact with the children, but she is terrified of him. She receives incapacity benefit and income support. Although she received several letters from the CSA, she did not respond to any of them because she was frightened and depressed; as a result, however, she was threatened with a benefit penalty. With the help of an adviser, she won her case at a tribunal, even though initially she was reluctant to appeal because she was too afraid. In the second case, a lone parent with two sons, aged six and eight, was notified that a benefit penalty would be imposed because the CSA did not accept that she was exempt. She had been threatened by her ex-partner, who told her that, if she co-operated with the CSA, he would withdraw contact with the children. Her sons had suffered badly from his previously having withdrawn contact for one year; they had exhibited signs of intense distress. The woman had only just re-established that contact. She argues that her children are at risk of undue distress, but that argument has been rejected by the CSA. She is now in turmoil, taking antidepressants, while awaiting an appeal against the benefit penalty. The system causes hardship to the very children whom it is meant to support. Children in one-parent families are among the poorest in the land, and their parents can ill afford to lose a significant proportion of the already small sum on which they are expected to live. That is why we tabled our amendment.

Angela Eagle (Labour, Wallasey)

I shall try to deal with the issues as they were raised during the debate. They are quite wide ranging, but I shall do my best. New clause 4 is designed to influence the way in which the CSA organises its resources in respect of collection and enforcement activities. The agency would have to take action against non-resident parents who have made no child support maintenance payments, who comprise 30 per cent. of the current case load, before turning to those who are partially compliant, who comprise 23 per cent. of the case load. I understand why the Opposition have been motivated to set out such priorities. My argument has already been touched on by the hon. Member for West Chelmsford (Mr. Burns): the solution lies in the simplification of the CSA's business and process that the Bill will bring about. Under the current, complex formula, the CSA spends 90 per cent. of its time on collection and only 10 per cent. on enforcement. Under the new system, much more of the CSA's time will be spent on proper enforcement of maintenance agreements, once they are reached.

Simon Burns (Conservative, West Chelmsford)

Is there not a problem with relying on good nature and the simplicity of the system? No matter how much simpler the new system is to operate, if the parent who has to pay child maintenance does not like the amounts, he will attempt to avoid paying by delaying or employing some other method. There will still be a huge backlog because of resistance on the part of paying parents.

Angela Eagle (Labour, Wallasey)

There are fewer ways to stymie the new simplified system than there are to stymie the current complex formula. I cannot guarantee that there will never be a backlog, but we believe that, once the new formula is in place and the CSA is up and running at full speed, maintenance assessments will be made within four to six weeks, instead of the current six months.

Simon Burns (Conservative, West Chelmsford)

The Minister refers to the formula, but it will not stop those parents who think that they know how much they will have to pay having no contact with the CSA, replying to letters or demands for information by querying them or not supplying all the information, or not supplying accurate and correct information. Those problems will still remain, however simple the system is, if a group of people want deliberately to string out or avoid paying.

Angela Eagle (Labour, Wallasey)

Of course some things can be strung out. My argument with the new clause is that it creates a priority list that demonstrates to people that, if they pay something, however little, the CSA will leave them alone while it chases other people. I think that we can pick up everybody. Some people will be more obstructive than others, but the changes to the system will give the CSA more space and time to focus on chasing those who, in the past, have got off scot-free. The old CSA got into many difficulties administering the formula that it had been given.

Eric Pickles (Conservative, Brentwood and Ongar)

The Minister seems to suggest that the new clause represents the Opposition's policy. In fact, it reflects what was the Labour party's policy. Will she explain how the target of catching up with the 100,000 who are not making a contribution will be met? How will she target them? Surely she is not saying that the simplified formula alone, which we support, will achieve the target? People are avoiding making payments because they have no intention of doing so, and not because of the formula. If the hon. Lady will take us through how the target will be achieved, I am sure that we shall make rapid progress.

Angela Eagle (Labour, Wallasey)

The present system involves more than 100 different facts being established before a maintenance order can properly be calculated. Changes of circumstances happen so regularly that the assessment can virtually be out of date before it can be administered and notified to those who are responsible for paying it. The proposed formula is radically simpler. It will be necessary to establish the number of children and the income of the father, and then make a simple calculation. It will leave the CSA with much more time to pursue the more difficult cases. We want to ensure that non-resident parents will all meet their responsibilities for their children, and make regular and reliable payments of maintenance. We do not want to create perverse incentives to pay a little so that fathers are not chased for the rest, while people who have disappeared from the system—there will always be difficult cases in any system—are left to be pursued at length. That is not appropriate. Our priority is to ensure that all fathers make the proper payments. The provision proposed in new clause 5—

Steve Webb (Liberal Democrat, Northavon)

I asked the Minister a specific question on new clause 4 about the agency's incentives and the targets that it is given. Presumably, targets are set to try to make the agency prioritise particular actions. Do the agency's targets encourage it to pursue non-payers?

Angela Eagle (Labour, Wallasey)

The targets relate not to the amounts of maintenance paid but to the speed and accuracy of assessment, which is the main work that the CSA does with 90 per cent. of its time and to case and cash compliance. With the new system, we shall be able to take a completely new look at how the targets operate. Clearly, we would not wish to establish targets that would create incentives for odd results. I entirely take the hon. Gentleman's point. We are asked in new clause 5 to put in place a provision that already exists in section 31 of the Child Support Act 1991, which allows for a deduction from earnings order to be made in respect of the current maintenance liability, plus an amount for arrears. About 98 per cent. of the almost 130,000 deductions from earnings orders in force cover arrears as well as current liability. Those figures are from November last year, and are our most recent ones. New clause 5 is unnecessary because what is sought is already done. We all know that the complexities of the current formula leave the agency with little time for collecting maintenance, which is why a radical simplification has been brought before the House. Amendment No. 76 would reduce and time-limit reduced benefit decisions. Because of the way in which it is drafted, it would also reduce the benefit of the parent with care by 20 per cent. of the whole. The 40 per cent. reduction in place relates only to the adult applicable allowance, so the proposed 20 per cent. represents a higher proportion. Listening to the speech of the hon. Member for St. Ives (Mr. George), one would think that good cause did not exist, but it does and it works effectively. If there are cases around the edge that he wishes to bring to my attention, we shall examine them. The plain fact is that if a woman suspects that, by engaging the CSA, she may be in danger of violent behaviour from her ex-partner, that constitutes good cause. There is no way that the CSA will pursue maintenance if she can show good cause for its not pursuing it. The issue of sanctions and reduced benefit decisions involves parents with care who refuse to get the CSA involved, and are happy for the taxpayer to pay for the upkeep of their children, without good cause. In other words, they are not in danger of a violent reaction from their ex-partners. The benefit deductions are designed to persuade those people to come into the system. We do not believe that payment of child support should be optional, and that people should be able to choose. That is partly to protect the taxpayer. It ought to be the exception, rather than the rule, that child support is not in payment.

Desmond Swayne (Conservative, New Forest West)

Where it is shown that there is good cause, is that not a matter for referral to the police for investigation? It cannot be left that someone should get off, just by making such a threat.

Angela Eagle (Labour, Wallasey)

I agree with the hon. Gentleman absolutely. There should be zero tolerance of such behaviour, and we should not kowtow to it by setting up a system that seems to create incentives for people to behave in that way. I agree with the point that the hon. Gentleman made in his earlier intervention. When the good cause definitions were changed from 10 and 20 per cent. to 40 per cent. in 1996, 70 per cent. of parents with care initially claimed that they had good cause not to co-operate with the CSA. That point has been raised more than once by my right hon. Friend the Member for Birkenhead (Mr. Field). Parents have a responsibility to support their children. The benefits system should step in only when they are unable to do so. Child support should not be optional. The underlying purpose of a reduced benefit direction is to encourage parents with care to apply for child support, unless they have good reason or good cause not to do so. We believe that a benefit penalty of 40 per cent. of the adult applicable amount in income support, which is not the whole amount of benefit and certainly not that which would be allocated for the children, is set at the right level to achieve that. About 85 per cent. of parents with care claiming benefit co-operate with the CSA in seeking maintenance, which compares with only 30 per cent. who used to co-operate. This total turn-around, which has occurred in a very short time and is an extremely positive development, is due in part to the improved closer working arrangements between the Benefits Agency and the Child Support Agency. It is a real achievement. Since April 1999, Benefits Agency staff assist new income support clients in completing maintenance application forms where appropriate. That means that clients need give information to the Department only once. However, the fact remains that some parents with care refuse to co-operate with the agency without good cause, so we need to retain a meaningful penalty provision. It would be unfair on children if we did not impose sanctions on parents with care who unreasonably prevent—I stress, unreasonably prevent—the recovery of child support. We are very conscious of the need to protect vulnerable parents and their children. As I said earlier, if there are reasonable grounds for believing that the parent with care or any child living with her would suffer harm or undue distress as a result of pursuing child support, no penalty will be imposed.

Andrew George (Liberal Democrat, St Ives)

Prior to the improvement in the CSA's record, how many of the parents not co-operating with the CSA were claiming good cause?

Angela Eagle (Labour, Wallasey)

I do not know the figures off the top of my head, but I shall give them to the hon. Gentleman if he wishes. I was about to share with the House the drop, as a percentage of case load, in the number of people on reduced benefit directions. That has come down from 19 per cent. in 1997–98 to 9 per cent. now, and we hope to bring it down even further. In Committee, Opposition Members tabled an amendment proposing that the courts should be able to impose a curfew or a community service order for refusal to pay child support maintenance, with which I had some sympathy, and I agreed to see whether we could frame amendments to achieve that aim. The hon. Member for Brentwood and Ongar (Mr. Pickles) has the letter that I sent to him after careful, not perfunctory, consideration. I was anxious to see whether that could be done. Unfortunately, sanctions such as curfews or community service orders are penalties for criminal offences and non-payment of child support is a civil issue. Extending the Bill as Opposition Members suggest would mean importing into the civil system all the legislative and operational arrangements that apply to the criminal courts. For example, probation officers would have to provide pre-sentencing reports and the mechanics surrounding electronic tagging where private sector firms are appointed to monitor the arrangements. The effect of that would be to superimpose on the civil system virtually all the penalties available in the criminal courts, and we would lose the distinction between magistrates sitting in their civil and criminal capacities. We considered the matter carefully, but we could find no way to legislate for such penalties without superimposing the criminal system on the civil system.

Simon Burns (Conservative, West Chelmsford)

It may assist the hon. Lady if I draw to her attention the precedent of curfews imposed in certain parts of our towns and cities to keep young people off the streets at night. I understand that that has been done under the civil, not the criminal, law.

Angela Eagle (Labour, Wallasey)

That is not my information, but I shall check.

Desmond Swayne (Conservative, New Forest West)

Given what I describe as the unnatural nature of what I believe is a crime—the determination not to make a financial provision for one's own offspring—would it not be appropriate for the hon. Lady to impose a criminal penalty when the Bill is reintroduced in the other place?

Angela Eagle (Labour, Wallasey)

That is the hon. Gentleman's view, but I have looked at the matter carefully and I do not think that it would be appropriate to make non-payment of child support a criminal offence. I shall explain why. Criminal sanctions are about punishment. Child support is about doing what is best for children and encouraging fathers to pay maintenance and, hopefully, in most circumstances, to play a full part in their children's lives. That would not be achieved by criminalising the non-payment of child support. The downside of that outweighs the positive effects that the hon. Gentleman outlines. I realise that people might have a different view, but that is the view that I take.

Eric Pickles (Conservative, Brentwood and Ongar)

I recognise that the hon. Lady understands the benefits of such a measure and rejects it reluctantly, but will she confirm that taking away a driving licence is an alternative to imprisonment? If so, I do not understand the difference between imprisoning someone and imposing a curfew order. As the hon. Lady supports our objective, she must have received legal advice, so perhaps she would share it with us.

Angela Eagle (Labour, Wallasey)

Clearly, the courts have to decide when someone comes before them whether he or she has culpably and neglectfully—I think that those are the words used in the legislation—declined to pay child support, so there must be on-going evidence of complete non-co-operation and refusal to accept responsibility. It is then up to the courts to determine the penalty: removing the driving licence or the ultimate sanction of committal to prison. Evidence from other countries and jurisdictions shows that removing a driving licence is an effective method of getting child support maintenance paid. We look forward to approving that when the sanction becomes available to the courts. However, it will be up to the courts to decide whether to effect it in every case. I appreciate that Conservative Members are trying to be helpful in tabling the new clause; I genuinely tried to be helpful in seeking ways of including its substance that had no major implications for the criminal and civil court system. I could not do that, but I am glad that there is so much cross-party support for our aim of helping to eradicate child poverty by ensuring that all parents support their children. I ask hon. Members to reject new clauses 4 and 5 and amendments Nos. 79 and 89 for the reasons that I outlined. Government amendment No. 40 would make technical changes to clause 16, which introduces a new civil penalty and gives the courts the power to disqualify a non-resident parent from holding or obtaining a driving licence when child support is not paid. It clarifies that the courts are required to notify the Secretary of State or, as he directs, the Drivers and Vehicle Licensing Agency when a disqualification order has been made, amended or lifted.

Simon Burns (Conservative, West Chelmsford)

Would someone's driving licence be taken away in lieu of paying the money, or would it be an additional penalty to bring pressure on the person to pay? I hope that it is the latter.

Angela Eagle (Labour, Wallasey)

It is not in lieu of paying the money. The simple way of retaining one's driving licence is to pay before the courts decide to take it away. We hope that that will be the penalty's DRIVE—Development of Rural Initiative, Venture and Enterprise [Wales] DVLA Driver and Vehicle Licensing Agency, effect. However, if payment continues not to be made, the courts can make another disqualification order.

Frank Field (Labour, Birkenhead)

I am grateful to my hon. Friend and neighbour for giving way. Does the Bill provide for offices to use the driving licence centre as a way of tracing individuals? If the driving licence is in the relevant individual's name, can the make of car he used as evidence about life style? I appreciate that the question moves the debate on, but I could not envisage another opportunity of raising the matter.

Angela Eagle (Labour, Wallasey)

As always, my right hon. Friend is creative in his questions. I suspect that the answer is yes, but I want to check some data protection matters and be confident that I am right before issuing a ringing yes.

Eric Pickles (Conservative, Brentwood and Ongar)

The Minister has been very courteous. We got rather excited about the Bill in Committee and spent much time on curfew orders. We did not ask a question that perhaps we should have asked. Will the driving licence be removed for a period or until the debt is paid? Before the driving licence is restored, would the person have to resit a test?

Angela Eagle (Labour, Wallasey)

I can answer a ringing no to the last question. The maximum period will be up to two years. However, the courts will consider specific circumstances when they decide whether to apply the penalty.

Eric Pickles (Conservative, Brentwood and Ongar)

The second part of my three-pipe question is, if the person repays the debt, will he receive the driving licence back immediately?

Angela Eagle (Labour, Wallasey)

Yes, answered ringingly.

Desmond Swayne (Conservative, New Forest West)

rose—

Alan Haselhurst (Deputy Speaker, Saffron Walden)

I am not sure whether the Minister has concluded.

Angela Eagle (Labour, Wallasey)

I have.

Eric Pickles (Conservative, Brentwood and Ongar)

Our discussion has been good and fair. Our new clause raises an important point. We share the view of the hon. Member for Northavon (Mr. Webb) that we want an understanding about targets. When the Labour party was in opposition, it was clear that it would target non-payers. The Minister says, fairly and reasonably, that the new system will try to avoid spending 90 per cent. of the time on assessment, although we shall come to aspects of that which might make that statement appear a little bold, certainly at face value. I hope that she does not take offence, but I do not believe that the Government have given no thought to the new targets—which do not relate to assessment—and it would have been helpful to discuss targeting people who have made no contribution. There is general agreement around the Chamber that we should go after such people and no sympathy on either side of the House for those who say, "I've paid a couple of quid a month so the CSA will leave me alone." There is a general test of reasonableness in that. We may probe some more, perhaps in the other place, but I emphasise that these are Labour's own targets. They were not merely thrown together. Non-payers are Labour's No. 1 target and the Government are going for them more than anything else so it is disappointing—I put it no more strongly than that—that they have not said how they will achieve that. The Minister says that it would not be possible to implement amendment No. 89, our other major proposal. She thought it a good idea in the excitement in Committee, but does not seem terribly keen now. She says that it is complex and would involve probation officers' reports and this, that and the other, but I hope that she will have another word with the lawyers. If someone is to be sent to prison, reports have to be obtained. Our judicial system does not throw somebody in jail without making pre-sentencing inquiries.

Maria Eagle (Labour, Liverpool, Garston)

The hon. Gentleman will be aware that people go to prison for civil offences. A person can be sent to prison without the whole criminal justice system being imported to the procedure that leads to imprisonment.

Eric Pickles (Conservative, Brentwood and Ongar)

I am aware of that. I am not being highly critical and, when I received the Minister's letter, I did not thump on her door and say, "You are being extremely unreasonable." However, we need to consider that matter.

Desmond Swayne (Conservative, New Forest West)

Will my hon. Friend give way on the question of unreasonableness?

Eric Pickles (Conservative, Brentwood and Ongar)

Yes.

Desmond Swayne (Conservative, New Forest West)

It might be unfair to ask my hon. Friend this question, but the Minister sat down before I could ask it of her. If two individuals in identical circumstances had the same amount of debt, but one had no driving licence and the other had and that was withdrawn by the court, what compensating penalty would be imposed on the other, given that he would have no driving licence to withdraw? Would he be thrown in prison? Would that not be a penalty for not possessing a driving licence? In the interests of equity, we need answers to those questions.

John Bercow (Conservative, Buckingham)

He would lose his bus pass.

Eric Pickles (Conservative, Brentwood and Ongar)

My hon. Friend the Member for New Forest, West (Mr. Swayne) is a tough man, as always, and my hon. Friend the Member for Buckingham (Mr. Bercow) suggests that such a person would lose his bus pass. He almost certainly would not, but my hon. Friend the Member for New Forest, West was not making a jocular point because there is a great discrepancy in the Bill. There is a difference between a light tap and a heavy penalty, and we seek a degree of grading. The hon. Member for Liverpool, Garston (Maria Eagle) raised a legitimate point. She said, "If the Conservatives are right, the great panoply of the criminal law will be imposed on a simple matter." However, we are not saying that. We are considering what the Prime Minister has said. Curfew orders are straightforward and concern the release of a prisoner into the wider community. When a prisoner is released, various procedures are necessary: for instance, probation reports must be received. 5 pm The Prime Minister is saying, "The orders have been quite successful; let us transfer them to other offences." The offences that the Government have identified are domestic violence, which is clearly criminal, and stalking, which is also clearly criminal. However, they are now considering extending such orders to the Child Support Agency. As the Minister said, we are not talking about those who are a bit behind with their contributions; we are talking about the person who says, "I do not care how many demands I receive. I am not going to pay." If the Minister thinks that curfew orders are not appropriate, other options should be considered before the Bill completes its passage in another place. My hon. Friend the Member for Uxbridge (Mr. Randall) has suggested putting people's credit rating on their credit cards; other civil measures may be possible. What we are saying is that the penalties must contain a gradable element. If the legislation is to have teeth, it cannot be all or nothing: there must be something in between. I hope that the Minister will take a long hard look at possible civil penalties, because the Government's proposals are not satisfactory. The measure involving driving licences is not sufficient by itself. I do not mean to be hurtful, but putting that measure on its own into the Bill makes it look ridiculous—and no legislation that aims to make people meet their responsibilities can afford to look ridiculous. I hope that the Government will consider what I have said, and what improvements might be made in another place. On that basis, I beg to ask leave to withdraw the motion.

CHILD SUPPORT AGENCY: QUALITY STANDARD GUARANTEE

Eric Pickles (Conservative, Brentwood and Ongar)

I beg to move, That the clause be read a Second time. Again, I do not want to be hurtful, but I think it fair to say that the CSA has not enjoyed the best of records in terms of reliability. In general, Members of Parliament are not specialists—we are jacks of all trades and masters of none—but one issue on which we have firm views is that of the CSA. Every Friday or Saturday, when we hold our constituency surgeries, someone arrives with something from the CSA. People either have a lot of little envelopes that have to be put in order, or, worse, they have put all the material in a big ring binder, and one's heart sinks. I must add that I think there that has been an improvement. The CSA has made an effort. It has improved enormously in terms of answering the telephone, and—I am speaking for myself here—I have always found its officials to be tireless and diligent. I recognise that they have been operating in difficult circumstances.

John Bercow (Conservative, Buckingham)

You are not making a confession.

Eric Pickles (Conservative, Brentwood and Ongar)

We must speak as we find. Others may have experienced difficulty, but I have always found the CSA's officials to be very polite.

John Bercow (Conservative, Buckingham)

My point was simple. Will my hon. Friend confirm that his dealings with the agency have been on behalf of constituents and not, as it were, to plough his own furrow?

Alan Haselhurst (Deputy Speaker, Saffron Walden)

Order. The rules of the House are simple, too: comments from a sedentary position are not helpful.

Eric Pickles (Conservative, Brentwood and Ongar)

I understand that my hon. Friend the Member for Buckingham was making a joke. I am sure that the time will come when I will be able to laugh at it. Of course I contacted the CSA on behalf of my constituents. I thank him for making that clear. The new clause is about empowering the citizen. It will demonstrate to the citizen that something will happen if a mistake is made. There are important reasons for seeking to introduce the measure. It is a question of the Government putting our money where their mouth is. We have heard the Minister suggest that everything will be hunky-dory in the new system because the CSA will not spend its time going through the various forms, or making an assessment: it will be more about collections, so everything will speed up. We are not quite as convinced that we are about to gallop to sunlit uplands. The Government predict that everything will be fine. We think that, under the new system that will come into operation, unless the Government make significant changes, the CSA will be swamped. The level of applications will increase significantly. The reason is straightforward. The reforms will dig deep into middle England. We know that that land is much beloved of the Prime Minister. We know that Labour Back Benchers are keen to say, "What about our heartland? You have to stop pandering to middle England and start to look after our heartland." The Bill is not the place to start the great revolutionary march back to the heartlands. It is about filling our surgeries again with a new set of people, who have never dreamt of having any dealings with the CSA. There were enormous protests last time, but, in the words of the great Al Jolson, "You ain't seen nothing yet." If the Government are right, there will be no problem with the new clause because few people will claim, but there will be a move to non-benefit cases. If there is no benefit case, the parties can reach an agreement without interference from the CSA. That is reasonable and sensible. The state will have no particular financial interest, other than the normal and reasonable collection of taxes. However, once the Bill becomes an Act, 14 months' notice from the parent with care to the non-resident parent is all that is required, and then the CSA can suddenly take over the case. That is why the whole process will be swamped. The CSA will be a weapon in the fight between ex-spouses or ex-partners. We do not find that desirable. That is why people will need the redress that the new clause offers. We also envisage that it will create transfers between spouses by stealth, and that does not seem reasonable. In other words, the provision will give a bonus to parents with care and enable them to get the maximum settlement. It might be a clean-break settlement as far as the spouses are concerned, but it can never be a clean break in respect of the children. There could be a considerable transfer of financial resources between the spouses, so the provision would give a distinct advantage to the parent with care. For instance, having received transferred resources, the parent with care could then go to the CSA and ask for an assessment. Despite previous transfers of wealth, the non-resident parent would be subject to another assessment. That is why the CSA could represent a big bonus to the parent with care. We never wanted that to happen, and no doubt nor do the Government, but the potential is there. The system will be swamped as a result of the nature of the proposed changes. They include fixed bands that replace a fairly complex process of assessment. As I have told the Minister on the Floor of the House and in Committee, we support that proposal. However, there will also be a reduction in the number of variations or departures from the scheme. The new clause is necessary because, in many ways, the provision replicates a mistake by the previous Conservative Administration. We recognise that we made a mistake.

Desmond Swayne (Conservative, New Forest West)

One of the problems that we examined in Committee was the fear that there would be a growing number of variations as a consequence of the simplicity of the new formula. Would not the addition of new clause 27 provide a powerful incentive for the Government to keep up the pressure by means of a performance measure?

Eric Pickles (Conservative, Brentwood and Ongar)

My hon. Friend is half right. As he says, the new clause would provide a sensible performance measure and it would be helpful in that respect. However, as my hon. Friend said most powerfully in Committee, the demand for additional variations will not come from within the CSA or from the House; it is more likely to result from public disquiet and unhappiness. In a reasonable world, the new clause might operate as a check on the Government but, as we sought to demonstrate, it would at least provide an early warning of what might go wrong, and that is desirable. Before my hon. Friend intervened, I was about to don a hair shirt and apologise, so I shall do so now. We made a mistake when we made changes to the CSA. Although we introduced lots of departures and variations— depending on whether one reads the Bill or the Act—and that was sensible, we retained a fairly complex system of assessment. The Government propose a simplified, three-band system of assessment and we support that, but they also intend to reduce the number of variations. That cannot be sensible. It is a mirror image of the mistake that we made. There should be a simplified system of assessment, but a greater number of variations than the Government propose. That would temper the rough justice that the Government would otherwise impose. I have received a transcript of a talk given by Mr. Nicholas Mostyn QC—

Kali Mountford (Labour, Colne Valley)

Not him again.

Eric Pickles (Conservative, Brentwood and Ongar)

I have no doubt that Mr. Mostyn—one of the country's leading family law Queen's counsels—will be most gratified to receive that accolade of "Not him again".

Jeff Rooker (Labour, Birmingham, Perry Barr)

Same old stuff.

Eric Pickles (Conservative, Brentwood and Ongar)

Mr. Mostyn's speech was given, to Manches and Co., on 7 March 2000, and is therefore quite recent. The Minister therefore cannot say that it is the same old stuff. It is new stuff, and he should pay some attention. [Interruption.] We will come to that in a few moments. However, I do not think that it is appropriate to be doing the knitting by the tumbrels. The Bill is about ensuring that there is maintenance for children, not about redistribution of wealth. I think that the Under-Secretary had better contain herself a little. 5.15 pm Nicholas Mostyn said: It seems to me if you are going to make the formula more simple you must make your departures wider. You can't make the formula more arbitrary and then cut down the grounds on which you seek departure. That seems to be a very fair assessment. Labour Members—in their "not him again" mode—will perhaps want to hear something more to their taste. In "Children First: Reforming Child Support", published in October 1996, just a few months before the Government's general election victory, they talked about increasing the grounds on which an appeal can be made to include complaints not only against assessment itself, but against failures in the administrative process that led to it. New clause 27 would achieve precisely that. The new clause seeks to ensure that, if people are aggrieved, they do not have to wait a month to receive a reply. It would provide a way of ensuring that matters are dealt with. I do not know why the Minister of State should be so unhappy about that. The new clause will make the whole system run better. I do not see why the Government are getting themselves all upset about it. When we were debating the Bill in Committee, if anything made the Government more likely to accept a proposal, it was the idea that it would improve administrative convenience. The new clause is all about administrative convenience. The new clause will implement Labour's intention, and I commend it to the House.

Frank Field (Labour, Birkenhead)

Reading new clause 27, I thought that I agreed with it. However, after listening to the speech of the hon. Member for Brentwood and Ongar (Mr. Pickles), I am not sure that I do. However, I should like to add my weight to the Government's position—that it is crucial that we have a much more simplified formula and that we do not grant many exceptions to that simple formula. That is how our tax system runs, and it works well. There is agreement across the country on our tax system. The last thing that we want is more departures from a simplified formula. We are moving towards a formula that people understand, and part of that understanding is that there will be some rough justice. I hope that, after we have meandered through our debate, the hon. Gentleman will withdraw the clause—which in good nature and good faith could be considered in another place. I suggest that, if the proposal is not voted on today, but is considered in another place, we might consider creating a statutory requirement that maintenance payments should occur only after the errors have been put right. The hon. Gentleman is lucky in that he has only one person staggering in per surgery to complain. In Birkenhead, there are four of five people with shopping bags full of papers from the CSA. There may be cases where an individual has done all in his power to present the proper information, and it is found, much later, that the CSA has made a miscalculation or an error in computing maintenance, and the new maintenance bill, taking into account that error, is backdated to the period when the error was discovered and then presented to my constituent. In those circumstances, it is proper for taxpayers to meet the bill, and not individual constituents.

Andrew George (Liberal Democrat, St Ives)

I welcome the spirit of the new clause. It is reasonable to introduce targets and appropriate compensation, as the right hon. Member for Birkenhead (Mr. Field) pointed out. Clearly, his surgeries mirror my own. This is the area that has caused the most frustration and difficulty for constituents and Members of Parliament. I share the right hon. Gentleman's concern about the time period for targets, but there is a question mark over the point at which the target period effectively kicks in; in other words, when it can be agreed that all the evidence required by the CSA has been received, as that is often a cause of debate between the CSA and the client.

Frank Field (Labour, Birkenhead)

I was not arguing that so much. In circumstances where a constituent receives a letter stating that the CSA has discovered that, two years ago, it made a mistake in computing the maintenance, and presenting the constituent with the back payment that he owes, we want the Bill to ensure that our constituent does not pick up the bill and that the CSA does.

Andrew George (Liberal Democrat, St Ives)

I was making a point in addition to that point, with which I entirely agree. The backdating claims, and the resulting heavy burden upon many constituents as a result of errors made by the CSA, are pertinent points. These lie alongside the arguments made effectively by the hon. Member for Brentwood and Ongar (Mr. Pickles). Whether the hon. Gentleman seeks to push the new clause to a vote, or seeks simply to probe the matter, he will find strong support from my party.

Laurence Robertson (Conservative, Tewkesbury)

When I was first elected, a great many people came to my surgeries to complain about the CSA—not only about its mistakes, but about calculations that were not done and about cases dragging on and on. It may be dangerous to say this, but I find that there are fewer cases coming to my surgeries now. In view of that, I hope that we are not being premature with some of the changes that we are making in the Bill, which undoubtedly creates a system of rough justice. Many changes in the Bill are to be welcomed, but we may come to regret creating such a system.

Desmond Swayne (Conservative, New Forest West)

Is my hon. Friend suggesting that the targets set out in the new clause are not necessary because the administrative situation has improved so much? If that is so, is the Bill necessary at all?

Laurence Robertson (Conservative, Tewkesbury)

I am not quite saying that, but my hon. Friend's question leads to an interesting point. I hope that I may test your patience slightly, Mr. Deputy Speaker, by drawing an analogy—

Alan Haselhurst (Deputy Speaker, Saffron Walden)

Order. It occurred to me that the hon. Member for New Forest, West (Mr. Swayne) was directing the hon. Member for Tewkesbury (Mr. Robertson) more accurately to the substance of the amendment than his own opening remarks suggested. I allowed the Opposition Front-Bench spokesman some licence to put the background to the new clause, but I cannot allow the same licence to other hon. Members.

Laurence Robertson (Conservative, Tewkesbury)

I understand, Mr. Deputy Speaker. I am grateful to you for your guidance, and to my hon. Friend the Member for New Forest. West (Mr. Swayne). I had not appreciated how helpful he was being.

Desmond Swayne (Conservative, New Forest West)

I am here to help.

Laurence Robertson (Conservative, Tewkesbury)

In view of that advice, I shall turn straight to the detail of new clause 27.

Angela Eagle (Labour, Wallasey)

Very wise.

Laurence Robertson (Conservative, Tewkesbury)

I am sure that it is wise to do so. I support new clause 27, which would be very useful. It would concentrate the minds of those at the CSA charged with ensuring that money finds its way to parents with care so that children are helped, and with ensuring that people are not charged unfairly. The performance measures that the new clause could be said to be introducing would be very effective. Target times are all well and good, but we must be aware that in some circumstances it might not be possible to meet such a target. The reasons may be outside the CSA's control—for example, it may not be possible to get the relevant information. When that happens, it would be far better to extend the time a little than to drop the case and allow the costs already incurred to fall to the taxpayer. That is not something that I support. I am in favour of the new clause, but I think that we must keep something of an open mind about the possibility that the time limit might have to be extended sometimes. My hon. Friend the Member for Brentwood and Ongar (Mr. Pickles) spoke about empowering people, and the new clause would empower people to receive what they are entitled to. In that way the taxpayer would be relieved of the burden. The new clause would also mean that the non-resident parent—the one who does the paying—would receive the justice that he deserves. All hon. Members know that delays cause many problems, and mean that parents with care and their children have to live without support. In the cases that I have dealt with, many problems have been caused by arrears building up, and the compensation provided for in new clause 27 might well have to be set against those arrears.

John Bercow (Conservative, Buckingham)

I am grateful to my hon. Friend for giving way. I am sure that all hon. Members appreciate his balanced presentation of the case, but does he agree that new clause 27 is desirable, on its own account and because it would establish more widely the principle that compensation should be paid in the event of malfeasance?

Laurence Robertson (Conservative, Tewkesbury)

I entirely agree. In many cases, compensation, had it been paid, would have relieved greatly the suffering of aggrieved parents, regardless of which side of the argument they were on. Introducing time limits could prevent some of the problems that can be encountered. The threat of violence between the parties was mentioned earlier. I do not suggest that the new clause would remove such threats, but recognising and dealing quickly with them would lessen the risk of violence. There would also be less risk that people would disappear into the community and never having to pay a penny for their children. [Interruption.]

Alan Haselhurst (Deputy Speaker, Saffron Walden)

Order. I am sorry to interrupt the hon. Gentleman, but I hope that we can have a cessation of the chat lines going on between hon. Members on the Government Benches. I am trying to listen to the debate.

Laurence Robertson (Conservative, Tewkesbury)

Thank you, Mr. Deputy Speaker. I am sorry that hon. Members do not find my remarks terribly interesting, but they may come to be seen as important. A time limit would also simplify the system. If people are aware that the CSA means business and that it will sort out a case in X number of weeks, they might be more prepared to provide information, especially when they realise that compensation might be payable. I understand what the right hon. Member for Birkenhead (Mr. Field) said about compensation being paid for by the taxpayer. Would the Government also consider, in certain cases, asking for compensation from a party who has withheld information? I accept that that may be going slightly wide of the new clause, but it might be a way of preventing problems from arising in the first place.

Desmond Swayne (Conservative, New Forest West)

My hon. Friends have been eloquent in detailing the problems that Members of Parliament are faced with in their surgeries consequent upon the delays of the Child Support Agency. However, I think that their expectations of the impact of the new clause are rather exaggerated. In many respects, the problems are insoluble. When the CSA is confronted with those problems, it stands between two warring parties who have come to hate one another and who acknowledge no sense of contributory negligence in having chosen one another as partners in the procreation of children. We have to escape from the notion in the new clause that there should be a measure of customer satisfaction with the Child Support Agency. In many respects, such expectations cannot be met.

Eric Pickles (Conservative, Brentwood and Ongar)

I am not sure that my hon. Friend is entirely right. The new clause offers an early warning system that things are not going right at the Child Support Agency. One of the earliest signs that the agency is getting swamped and things are going wrong is the length of time that staff take to reply to letters or make assessments.

Desmond Swayne (Conservative, New Forest West)

I entirely agree with my hon. Friend. I began my remarks by saying what I think that the new clause would not achieve, despite some people's expectations. I now wish to deal with what the new clause would achieve, which my hon. Friend has drawn to our attention. Undoubtedly, many of the problems that compound the irritation and frustration of our constituents arise purely out of an administrative rather than a social problem. Part of that has undoubtedly been the lack of resources that have been made available to the agency. The Parliamentary Commissioner drew attention to that in reports to the House. It must be acknowledged that there has been a huge improvement in the agency's performance, measured by the number of cases that have been referred to the Parliamentary Commissioner, which is sharply down, and the number of cases referred to Members of Parliament. Nevertheless, one of the principal purposes of the Bill, as we are constantly told, is to streamline the administrative process because the existing process is far too cumbersome. I see that the Minister nods her head. Given that one of the Bill's principal purposes is to achieve that administrative streamlining and, as a consequence, deliver a measure of justice that the existing system simply cannot deliver, it seems appropriate to have some means of measuring the effectiveness of that administrative improvement. The new clause provides precisely that mechanism. It is appropriate that we should demand such provisions, because time after time in Committee, when we attempted to ameliorate what Ministers correctly referred to as some of the rough justice of the Bill, we were told that, although our amendments were desirable in themselves, they could not be accepted because they undermined the overriding requirement to deliver administrative efficiency. If the purpose of the Bill is to do that, surely the pay-off must be the provisions in new clause 27. The Bill will, of course, deliver a much simpler system, but it will be a much rougher form of justice. As a consequence, it is proper to provide our constituents with a form of redress if the system continues to fall down and if its administrative procedures do not match up to expectations. That would provide an administrative incentive to the Department and to Ministers to ensure that the CSA is properly resourced and capable of delivering the administrative solution for which the Bill was designed.

Eric Pickles (Conservative, Brentwood and Ongar)

The logical extension of my hon. Friend's argument is a point that I did not pursue. The provision would offer Ministers, or those in control of the CSA, a week-by-week view—an early warning that things might go wrong; they would not have to wait months to find out through an appeal. People would have begun to receive money so everyone would already know that something had gone wrong.

Desmond Swayne (Conservative, New Forest West)

That is correct. That mechanism must be built into the system because it is so manifestly lacking under the existing arrangements which the Bill attempts to remedy. In effect, the provision is a form of management information. To include that is not only correct, but would introduce an element of justice and redress that the Bill does not contain. Much of the Bill trades justice and fairness for administrative convenience—not for the benefit of the Department but for that of the taxpayer and, indeed, the customers of the CSA, for whom the present system is unfair and unjust because it is so complex.

John Bercow (Conservative, Buckingham)

My hon. Friend will have observed that subsection (2) of the new clause states that the "level of compensation payable" is to be set out in regulations consequent on the clause. Is it my hon. Friend's understanding that the levels—I think the plural is intended, or, if not, it would be appropriate—of compensation should be specified in the regulations, and that they should not be subject to the personal discretion or the administrative fiat of CSA staff?

Desmond Swayne (Conservative, New Forest West)

That is true. The principle of natural justice should apply to those regulations. Customers should be compensated for the tort—the wrong—that they have suffered; the compensation should right the injustice. I would expect that to be set out in the regulations. If that element of natural justice is not included, the Bill will not be compliant with the European convention on human rights. Presumably, Ministers have taken advice and reflected on that matter.

John Bercow (Conservative, Buckingham)

That would never do.

Desmond Swayne (Conservative, New Forest West)

My hon. Friend is unfair. In Committee, we covered such matters exhaustively and Ministers provided some satisfaction on them. I share entirely the Ministers' objective, but the new clause is desirable not only on the ground of natural justice but because it would provide what I have called the pay-off for some of the compromises on fairness that we have made during proceedings on the Bill. We have sacrificed fairness for administrative streamlining, and it is therefore appropriate to insert this measure of redress.

Angela Eagle (Labour, Wallasey)

We need to bear in mind in our deliberations the fact that the Bill will undoubtedly deliver a simpler and more effective system of child support, and because of it, more than 1 million children will gain. We are all in favour of targets. The only thing that divides the Government and the Opposition in this debate is where and how they should be set and in what context. I thank Opposition Members who have observed that there have been some improvements in the Child Support Agency. It is true that there have been huge improvements in its attempts to deliver a very difficult administrative system. The hon. Member for Brentwood and Ongar (Mr. Pickles) mentioned the telephone answering service. I can tell the House that, in 1996, only 1 per cent. of calls were answered promptly—

Kevin Hughes (Labour, Doncaster North)

If at all.

Angela Eagle (Labour, Wallasey)

My hon. Friend is right. That figure is now up to 70 per cent. Although all hon. Members have noticed some significant improvements, we know that there is a great deal more to do. Nobody is in favour of delays and arrears. We are all too familiar from our constituency postbags with the delays and poor service that the CSA, struggling with its current formula, can provide. The child support scheme has failed parents and children alike, and that is why we are revisiting the subject to try to get it right. Clearly, given our experience, it is our duty to bear administrative simplicity in mind when redesigning the system. The radical simplification of the way in which child support liability is assessed, by replacing the complex assessment formula with a straightforward one, will help a great deal. The new clause is unnecessary. In the reformed child support scheme, we expect the agency to make maintenance calculations within days and to get maintenance flowing in an average of four to six weeks rather than up to six months, as now. Clearly, by the time six months have elapsed, non-resident parents face difficulties having accrued arrears through no fault of their own.

Eric Pickles (Conservative, Brentwood and Ongar)

Would it be fair to say that the hon. Lady is rejecting the new clause as unnecessary because delays will not occur under the new system?

Angela Eagle (Labour, Wallasey)

If the hon. Gentleman is patient, I shall come on to explain why the new clause is unnecessary. I am disagreeing not with the requirement for targets but with the way in which the new clause would put them into effect and with some of the perverse effects that that would have. Indeed, the hon. Member for Tewkesbury (Mr. Robertson) pointed one out: if the agency had to ensure that all—that is the word used in the new clause—payments were made within a set time, regardless of how difficult a case might be, that might create a perverse incentive not to pursue some cases. Such cases would be bound not to fall within the target. The hon. Member for St. Ives (Mr. George) mentioned some of the difficulties and sensitivities of setting targets fairly. We are looking at a target of four to six weeks rather than six months in which to get maintenance flowing. The faster turnround of cases will get it flowing more quickly and reliably, and that is the aim underpinning the changes. The new clause would mean that the agency would be legally bound to deal with all cases referred to it in a set target time, regardless of whether the parents were co-operating, of why the delay had occurred and of the normal peaks and troughs in the number of separated parents applying for maintenance. The Secretary of State will, as now, set the CSA a range of targets each year, including those relating to clearance times. However, it is unrealistic and inappropriate to set such targets in legislation. That is not done in any other area, and legislation is a particularly inflexible way of setting targets. 5.45 pm If the wording of the new clause is taken literally, a target embracing the clearance of "all" cases would have to be set at the level of the most difficult case if it were to be remotely realistic. A more demanding target would lead the agency to devote a disproportionate level of its resources to clearing such cases, substantially worsening the position for those who would otherwise expect quick and effective decisions. That would be counterproductive. The chief executive of the CSA is rightly accountable to Parliament for the performance of her agency and details of its performance against each of its targets are published in its annual report. The performance of the agency is also subject to the scrutiny of the Public Accounts Committee and the Select Committee on Social Security. Requiring the CSA to meet what might be inflexible clearance-time targets that were set in isolation from other targets, such as those relating to accuracy, would simply not be sensible. The new clause would also require the agency to pay compensation to parents where the agency failed to meet its statutory clearance targets regardless of the cause of the delay. As hon. Members will be aware, the Department of Social Security, in common with other Departments, has a discretionary compensation scheme, which provides financial redress to anyone who has suffered financial loss, harm or suffering as a result of poor administration.

Eric Pickles (Conservative, Brentwood and Ongar)

I think that the Minister has misread the terms of the new clause. It says: The Secretary of State shall, by regulations, set a target time within which the Child Support Agency shall deal with all cases referred to it. That means all the various categories. The Secretary of State will set the targets for the various categories and it is a perverse reading of the true meaning of the new clause to suggest that a target must be set for every single case. The new clause would mean that targets would be set for the various categories. If that is what it means, all the Minister's objections to it will be swept aside.

Angela Eagle (Labour, Wallasey)

The hon. Gentleman did not deal in detail with that aspect of the new clause when he moved it. However, it refers to "all cases". There is no distance between us on the need for the CSA to have targets. Those targets should be published and should be made available. The CSA should then prove to the rest of us—its accountability is well set out—that it is capable of meeting those targets. I do not think that the new clause would assist that process, and we do not want the targets to be set in legislation. They are normally set by a Secretary of State and reported on in annual reports, but they certainly do not appear in secondary legislation. If they did, that would make them inflexible. Compensation is already paid and, last year, it amounted to more than £4.5 million. There is nothing between us on the setting of targets and I am not saying that we will not set very rigorous targets for the CSA. However, we do not want to set them in legislation; we want them to be set in the normal way. I assure the hon. Gentleman that the CSA will be accountable.

Eric Pickles (Conservative, Brentwood and Ongar)

I am most grateful to the Minister. She says that there is consensus on the setting of targets, and she is absolutely right about that. Everyone agrees that the targets should be reasonable. We do not want to place the CSA and even Ministers in a difficult position. We argue that realistic targets should be set. There is, however, a difference of opinion between us. She says that if targets are not met for individuals, nothing will happen. We argue that people should be entitled to compensation, but when I said that nothing would happen, the right hon. Member for Birkenhead (Mr. Field) shook his head. I am not sure what would happen. Perhaps a report would be written, perhaps the CSA would have to appear before a Select Committee and receive a grilling or perhaps it would be the subject of an audit from the Public Accounts Committee. However, such processes are meaningless to ordinary members of the public, because they are blissfully unaware of them. We have debated this issue before and we must remember that the individuals involved are ordinary folk who want to achieve justice from the system. They are not concerned whether an official whom they consider to be highly paid appears before a Select Committee and receives a bit of a grilling from even more highly paid politicians. They are thinking, "I've been waiting a month and nothing has happened. Why not? I haven't received any compensation or an apology. I've received nothing."

Desmond Swayne (Conservative, New Forest West)

The Minister, in putting her case, set out what targets she will seek to achieve for the length of time taken to process an application. Does my hon. Friend consider those targets reasonable, as the Minister does, or does he have alternatives?

Eric Pickles (Conservative, Brentwood and Ongar)

Well, we do not know what targets the Minister will set. We have had a vague promise that targets will be set.

Angela Eagle (Labour, Wallasey)

We shall publish the targets. Clearly, they will not be a state secret. Targets for the CSA and all agencies within the Department of Social Security are published, so I can assure the hon. Gentleman that the process will be open.

Eric Pickles (Conservative, Brentwood and Ongar)

I am sure that receiving the targets will not be a case of meeting at the crossroads at midnight. I am sure that they will be published.

Desmond Swayne (Conservative, New Forest West)

Given that the targets will be published and that the Minister complained that it would be inappropriate to set targets in the Bill, there can be no objection to the new clause because it does not require targets to be included in the Bill. It merely requires the Secretary of State to set targets.

Angela Eagle (Labour, Wallasey)

In regulations.

Desmond Swayne (Conservative, New Forest West)

Indeed, in regulations. Given that the Minister will set such targets—

Alan Haselhurst (Deputy Speaker, Saffron Walden)

Order. If the hon. Gentleman is seeking to make an intervention on his hon. Friend, he needs to disguise it better than that.

Eric Pickles (Conservative, Brentwood and Ongar)

In so far as I understand my hon. Friend's point, I agree with him. The Minister was told by those briefing her on the new clause, "This will be a piece of cake because the Tories have tied themselves in knots. We do not want to set the targets in legislation because that is wholly unreasonable. Look, they're using the word 'all', so you'll have no problem dismissing the new clause." Of course, problems have started to occur. We have had distinguished contributions from the Liberal Democrats and, of course, my hon. Friends, saying that the new clause is sensible. My hon. Friend the Member for New Forest, West (Mr. Swayne) is absolutely square on. We must look at the new clause. It is nice to debate legislation in this place but it is better to look at what we are debating. The new clause says: The Secretary of State shall, by regulations, set a target time within which—

Jeff Rooker (Labour, Birmingham, Perry Barr)

The hon. Gentleman has already read out the new clause.

Eric Pickles (Conservative, Brentwood and Ongar)

The right hon. Gentleman is absolutely right, but it is clear that he was not listening, so I shall continue. The new clause says: The Secretary of State shall, by regulations, set a target time within which the Child Support Agency shall deal with all cases referred to it. We want the Secretary of State to do precisely that. That does not mean to say that every case would have the same target. I do not suppose that the Under-Secretary thought that every CSA case would have an identical target. That is certainly not what she just said. She started to take hon. Members into her confidence and said that the targets will be published and the process will be open. The new clause seeks only to ensure that the targets set by the Secretary of State will have a consequence. Subsection (2) would empower the Secretary of State to set the level of compensation to be paid if those targets were not met. That is necessary for two reasons. First, as I have already said, we want to ensure that the people waiting on the telephone and sending letters do not think that their words have gone into a great black hole.

Desmond Swayne (Conservative, New Forest West)

I fear that in his attempt to be reasonable and to persuade the Government to adopt the new clause, my hon. Friend is handing rather too much power to Ministers because the regulations, compensation and targets will be entirely at their discretion. Could he assist the House by indicating what would be reasonable compensation and what would be a reasonable target?

Eric Pickles (Conservative, Brentwood and Ongar)

I have no idea whether my hon. Friend is a fly fisherman or whether you are, Mr. Deputy Speaker, but when one casts the lure on the water, it is important that it is attractive enough to make the Government snap. My hon. Friend must recognise from his time in the House—which is daily becoming more distinguished—that the Government resist including precise figures in primary legislation because they want more power. To tempt the Government to accept the new clause, I am offering them considerable power. That is a straightforward strategy. I may be criticised for making it easy on the Government and for making the system work, but we decided that from day 1 we would deal with the Government on the basis of trying to improve the Bill, and that is why the new clause has been made so tempting.

John Bercow (Conservative, Buckingham)

Does my hon. Friend agree that on the subject of compensation payments the Minister gave us a passable imitation of Dr. Pangloss in suggesting that the present arrangements are entirely satisfactory? Does he recall that she referred to the overall sum available for compensation? Does he think that it is more important to establish that the individual amounts payable in given circumstances are appropriate than to brag holistically about the overall level, because that gives the impression that, Scrooge-like, she is concerned with the totality rather than the cause of individual justice?

Eric Pickles (Conservative, Brentwood and Ongar)

I understand my hon. Friend's suggestion. The Minister said that the new clause is not entirely alien to the Government's measures; a compensation scheme exists and the new clause is perhaps a natural add-on to that scheme. In a way the Minister is arguing against herself by not accepting the new clause. As I said, the first reason why subsection (2) is necessary is to ensure that the public understand that a compensation scheme exists. The second reason relates to administrative convenience. The new clause would enable us to find out pretty soon if things are going wrong. We could find out in various ways. We could set up a complex system, perhaps involving computer software and outside consultants who could monitor customer satisfaction, conduct opinion polls and set up a focus group of people who had dealt with the CSA. I suspect that all those methods would be very effective, but subsection (2) offers a cheap and cheerful alternative. Compensation will be paid on the basis of a failure to comply with pre-set Government targets, so we would find out instantly if things went wrong. Sensible CSA managers would be monitoring the effect of the new clause almost weekly. I imagine that they might well have a graph in their office showing the amount of compensation being paid. If they suddenly found that the curve was starting to change and the graph was becoming almost vertical, they would ask themselves what was happening. That would tell us that something has gone wrong in the system; it would give us an early warning—

Alan Haselhurst (Deputy Speaker, Saffron Walden)

Order. May I give the hon. Gentleman an early warning? I feel that he is beginning to repeat himself.

Eric Pickles (Conservative, Brentwood and Ongar)

I apologise, Mr. Deputy Speaker. As I am sure that you realise, I am genuinely attempting to improve the Bill and I have now made my second point. The Government suggest that the new clause, if it is interpreted in a certain way, might have a perverse effect, because of the words "all cases". I recall the Under-Secretary saying that there might be a possibility of officials deciding not to pursue certain cases because they would take too long. The hon. Lady understands that we interpret the words "all cases" differently, but—[Interruption.] The Minister of State appears to want me to go on even longer, even though I have already received a warning from the Deputy Speaker. I was about to become accommodating, so the right hon. Gentleman should not provoke me. Because of the Under-Secretary's comments and because our proposal appears to have attracted cross-party support, I am hopeful that she will have a little think about it.

John Bercow (Conservative, Buckingham)

Is not the problem with compensation that the process of pursuing it is often difficult, lengthy and uncertain, notwithstanding the Under-Secretary's comments about the overall compensation payable? Therefore, is not the merit of the specificity of the new clause that it will give CSA staff an incentive to good performance that the Bill does not provide?

Eric Pickles (Conservative, Brentwood and Ongar)

My hon. Friend is absolutely right.

Angela Eagle (Labour, Wallasey)

The hon. Member for Buckingham (Mr. Bercow) has it slightly wrong: £4.5 million is not the amount of compensation that is available, sitting in a pot, waiting to be claimed, but is the amount of compensation that was paid out last year.

Eric Pickles (Conservative, Brentwood and Ongar)

I think that we understood that. Because the use of the phrase "all cases" might result in the new clause having a perverse effect, because there is a high degree of consensus on the clause, and because I suspect that the matter will be pursued in another place, I beg to ask leave to withdraw the motion.

SUBSTITUTED PART I OF SCHEDULE 1 TO THE CHILD SUPPORT ACT 1991

Eric Pickles (Conservative, Brentwood and Ongar)

I beg to move amendment No. 87, in page 83, line 7, at beginning insert— '( ) Where the amount of child support maintenance calculated exceeds such sum as may be prescribed ('the maximum sum'), the maximum sum shall be payable by the non-resident parent.'.

Alan Haselhurst (Deputy Speaker, Saffron Walden)

With this it will be convenient to discuss the following amendments: No. 88, in page 83, line 7, at beginning insert— ' "( )(a) Following the calculation of the amount payable by the non-resident parent the Secretary of State shall determine the net weekly income of the parent with care in like manner to the determination of the net weekly income of the non-resident parent. (b) Where the net weekly income of the parent with care exceeds the net weekly income of the non-resident parent of the Secretary of State shall in such manner as may be prescribed reduce the amount of child support maintenance payable by the non-resident parent. (c) Where the non-resident parent is liable to pay child support maintenance to more than one person the provisions of (a) shall apply to each parent with care and the reductions in the amount payable provided for by (b) shall apply to the amounts payable to each of those parents with care in receipt of a net weekly income greater than that of the non-resident parent.".'. No. 2, in page 83, line 35, leave out sub-paragraph 4(1) and insert— '4.—(1) Except in a case falling within sub-paragraph (2), a flat rate of £5 is payable if the nil rate does not apply and the non-resident parent's net weekly income is £100 or less.'. No. 3, in page 84, line 2, leave out from "force;" to end of line 4. No. 4, in page 84, line 5, leave out sub-paragraph 4(3) No. 5, in page 84, line 11, at end insert— '; or (c) he received any benefit, pension or allowance prescribed for the purposes of this paragraph; or (d) The or his partner (if any) receives any benefit prescribed for the purposes of this paragraph. (2) The benefits, pensions and allowances which may be prescribed for the purposes of paragraph 5(1)(d) include ones paid to the non-resident parent under the law of a place outside the United Kingdom.'.

Eric Pickles (Conservative, Brentwood and Ongar)

The amendments address matters of great importance. On Second Reading, we made it clear that, although we support the notion of simplified banding, we believe that the Bill makes certain injustices likely. Three great injustices have not been addressed. The first is the issue of rough justice and the lack of variations, which you, Mr. Deputy Speaker, kindly allowed us to debate briefly in connection with new clause 27. The other two relate precisely to the amendments, especially the first two in the group. They are the injustice of not having an upper limit for the purposes of assessment and the injustice that arises when the parent with care is wealthy and the non-resident parent is poor. The Bill is a landmark measure because it creates a new right in law: that a child shall have a share of the parent's income during the lifetime of the parent. That legal right is unique, not only in British law, but anywhere else in the world, according to the advice that I have received from learned colleagues and counsel.

Desmond Swayne (Conservative, New Forest West)

Although the right might well be unique, it does not strike me as unreasonable. My hon. Friend appears to dispute the right. Will he explain why he considers it unacceptable?

Eric Pickles (Conservative, Brentwood and Ongar)

My hon. Friend must be patient: I was about to explain, but he will have to allow me a few oratorical flourishes before reaching that climax. I understand that a similar right exists in Germany, but only in connection with inheritance—in other words, the parent has to be dead. Britain is the only place in the world that will give that right when the person who has the money is still living. The strange aspect is that the right is given only to children of a broken marriage or relationship; in addition, the right affects only the non-resident parent's wealth. Therefore, children do not have such a right in relation to the parent with care or if their parents live together. A child of a broken marriage has no such right in connection with the parent with care, who might be wealthy, but has it in connection with the non-resident parent, who might be poor. Under the Bill, the child has no right to claim the money itself. Therefore, although we create a brand-new right in law that one child is entitled to 15 per cent., two children to 22 per cent., and three or more children to 25 per cent. of the non-resident parent's income, the children cannot get hold of the money themselves; it is paid over to the parent with care. No wonder the arrangement has been described as spousal redistribution by stealth. It is a way of re-examining a divorce settlement. I know that you like transparency in such matters, Mr. Deputy Speaker. It is strange that the Government are reluctant to give a reason for the arrangement. All we hear is a woolly statement that children have a right to enjoy and share in any increase in the wealth of the non-resident parent. That is all the explanation that has been given, so I hope that the Under-Secretary will provide some further explanation today. I do not believe that a child has such a right. I believe that children have a more important right, which is to be maintained by each parent. Children have a right to maintenance and to their education, housing and other needs being met, but they do not have a right to an immediate share in their parents' wealth. There might be a presumption or an expectation that, as time passes, certain sums will be handed over to a child during its lifetime, or that it will receive some sort of inheritance after a parent's death, but the child has no right to receive such sums. The House should not be involved in carving up a person's wealth. That should be a matter for the individual parties to decide. Individuals have a right, a duty and an obligation to look after and support their children. They cannot palm their children off on to somebody else. That is the position in law. We have been considerably helped, during the Bill's passage through the House, by the work of the Select Committee on Social Security. I shall quote from its recommendations, which I think are set out on pages xlii and xliii. The Committee states: In the final analysis, the child support formula should be seen clearly to be related to the cost of bringing up children and not as a straightforward "tax" levied on the non-resident parent. We recommend that the Government should re-examine the possibility of inserting in the legislation an upper limit on the automatic application of the revised CSA formula. That was wise advice. The wording was chosen because it reflected the evidence as it unfolded. Select Committees sometimes fall down when the dirty hand of politics becomes involved, and that happened in this instance. There was an amendment to strike out the recommendation to which I have referred and instead to include the words continue to share in that parental wealth. However, the Committee still felt able to include the warning that there is a risk that a few high-profile cases involving payments about the maximum contribution may negatively affect public perception. I bet they will. The social security system and the CSA will be brought into disrepute. I am sure that Mr. Bill Gates of Microsoft leads a blameless life and that he would never shirk his responsibilities. However, let us suppose that he did, and that the CSA came after him. Mr. Gates is worth £53 billion a year. According to the formula that the Government seek to impose, if he had two children they would receive £10.6 billion by way of child maintenance. The House will be aware that the gross national product of Luxembourg is £8.9 billion. That is an illustration that the formula goes beyond maintenance and that it does not make sense. I have used Mr. Bill Gates as an example because he is the wealthiest person whom I have heard of, and to ridicule the system. However, the Government's formula will have a more perverse effect. Another example is that of two houses side by side. In house A we have a parent with care on £9,000 and a non-resident parent on £300,000. In house B there is a parent with care on £300,000 and a non-resident parent on £9,000. I have simply reversed the figures. Let us suppose that each house has one child. On the basis of 15 per cent., child A would receive about £45,000 a year in maintenance, and child B would receive £1,350. That is a difference of £43,650. What sense is there in that? Are the Government suggesting that child B on £1,350 is adequately cared for? Presumably they are. Are they suggesting that child A on £45,000 is adequately compensated? Presumably they are. However, each child is identical, which is why the figures are so perverse. 6.15 pm If there is no upper limit, the CSA will find itself increasingly taking over court order assessments. The Law Society and leading lawyers are warning us about that. [Interruption.] The Minister makes disparaging remarks about the legal profession, but it was not so long ago that it was suggested that the CSA should set up a counselling service under a leading judge to produce a far more judicial system. After all, the Minister is seeking to achieve a lawyer's playground. A great deal of money will be made, and we can be pretty sure that that will not be for the benefit of children. As the Law Society and leading counsel have said, all that is required is 14 months' notice to be given by the parent with care, who can then take up to 25 per cent. of the non-resident parent's income. Even if there is a clean-break divorce, even if substantial child maintenance has been agreed, even if there have been deals with regard to the transfer of shares, pension rights, properties, the setting up of various trusts and various assets from the marriage being transferred, these events would be regarded as never having happened. It would be within the ability of the parent with care to go straight to the courts. I know that Labour Members are reluctant to accept quotes from Mr. Mostyn. However, in his talk, to which I referred earlier, he made an interesting observation about the legal profession and about how judges would deal with these matters. He referred to substantial maintenance and said: I think you are beginning to see— He was addressing a bunch of lawyers— how this is going to be a lawyer's beanfeast for us because we are going to be very clever working out ways to get round this and I will explain some of them later on. A certain High Court Judge has said to me that if that happens— that is, if the proposed arrangements are made and are overturned by the CSA— I'm going to order spousal maintenance from the wife back to the husband to rectify the situation", but that won't work when they are unmarried. In other words, this is about spousal maintenance. It is a back-door means of achieving precisely that. I believe that the Government's approach was regarded as being rather politically correct, it being about the rights of the child. It was armchair political correctness. It was included to make everyone feel good—"We shall do this and the added bonus is that we might be able to stick a few rich people as a bonus." However, the scheme will have an effect further down the process. In Committee, the Minister said that, if we had an upper limit—I am speaking from memory, but I am pretty sure that the hon. Lady said this—we might be vulnerable to a challenge by the European Court of Human Rights. The hon. Lady is silent. I wish that she would give me a clue whether she said that or not.

George Stevenson (Labour, Stoke-on-Trent South)

We are waiting to be convinced by the hon. Gentleman.

Eric Pickles (Conservative, Brentwood and Ongar)

I am grateful to the hon. Gentleman. It is good to see him in the Chamber. I am pretty sure that the record will confirm what I believe the Minister said. However, an upper limit already exists. Is she suggesting that we are open to challenge? As leading counsel has said, we need to see that advice, because it goes against all the experts in family law. All the experts on the European convention on human rights say that that is not the case, but the hon. Lady seems to have found a lawyer to say that it is. If it flies in the face of conventional wisdom and all the advice that we have received, we should know. I look forward to hearing from her what the position is. We are not unique in having such a system. The system in Australia has the same aim. In Committee, I quoted extensively from Mr. Justice Kay of the Australian court. I did not realise at the time how distinguished he was. Apparently, he is the senior judge in the family court of Australia, and the principal appellant judge after the chief justice, so he is a senior man. Justice Kay was asked to give advice to the Select Committee, and stated: Placing a cap on administrative assessment of child support and factoring in some income of the carer are seen as being entirely consistent with two underlying essential bases of the scheme. The first principle is that children have their proper needs met from reasonable and adequate shares in the income, earning, property and financial resources of both of their parents. The second is that parents share equitably in the support of their children. Justice Kay was asked whether those principles would meet with public acceptance. He commented: The success of the scheme may well depend on the extent to which the public perceive it to be fair. Assessments which throw up $550— the sums are given in Australian dollars— a week for a baby or ignore the fact that the carer is earning $100,000 per annum whilst the payer is struggling to make ends meet do little to bolster public enthusiasm for the scheme. The Government's proposal is entirely consistent with the Labour party's pre-election pledge, which stated: We are determined to establish clear principles, in the context of changing times, and to devise policies that are as fair as possible for all the parties concerned, including mothers and fathers. I anticipate what the Minister will say. She will speak about rough justice and tell us not to worry, because the system is to be simplified. She will say that some people may be disadvantaged, but too bad. She will tell us that 96 per cent. of parents with care have net weekly incomes below £100, and that only 6,000 people will be affected. In my book, 6,000 is a substantial number, and that does not take account of the effect on middle England. Once the measure becomes law, there will be a rush—nay, a stampede—of people seeking to overturn court judgments and to get a larger slice by way of spousal distribution. Is it not absurd that we may be chasing a non-resident parent with a low income—as low, say, as £9,000 a year—when the parent with care is wealthy? Is it not absurd that we are giving children a right to a share of the income of one set of two parents? The amendments are intended to make sense of the CSA reforms.

Anne McIntosh (Conservative, Vale of York)

I am grateful to my hon. Friend for giving way. Where the non-resident parent has formed another relationship and the other partner to that relationship is making provision, should that not be taken into consideration?

Eric Pickles (Conservative, Brentwood and Ongar)

Not in the context of the amendment, which deals with parents with care who are wealthy. It is ridiculous to suggest that the income of the parent with care should not be taken into consideration. It makes a mockery of the system to chase after someone for a relatively small sum, when the child is living with a parent who has considerable wealth.

John Bercow (Conservative, Buckingham)

Does my hon. Friend agree that it would be an accurate summary of his position to say that he was arguing on the strength of the principle, "From each according to his ability, to each according to his need."?

Eric Pickles (Conservative, Brentwood and Ongar)

My hon. Friend is probably a keen fly-fisherman. I shall take no more interventions, as I want to make progress. We should stop making the CSA a laughing stock. Without the amendments, we will create injustice and a new concept in law which has not been thought out. We will undermine the successful introduction of a set of measures which we sincerely hope will succeed. I commend the amendment to the House.

Frank Field (Labour, Birkenhead)

I shall speak to amendment No. 87. I confess that, so far, Bill Gates has not come to my surgery to discuss the sort of issues raised in the debate. [Interruption.] Of course, I live in hope. I shall describe a real-life situation for some, but not many, constituents. I pose this as a question to the Minister, which she may answer now or in a letter later, about how the new Act will operate and the safeguards that it will contain. As I understand it, the safeguard is that people will be required to pay only a certain proportion of their income in maintenance. I have had a number of constituency cases in which people had their first child when they were, let us say, 16. They have a court order for the payment of maintenance for that child. They have then married and had a second family. That marriage has broken up. It is on that second family that the CSA calculations will be undertaken. I seek an assurance that, under the new system, the maintenance paid for the first child will be taken into account when the proportion of income taken in maintenance is levied—in other words, that that maintenance payment will be taken into account when the safeguard which I understand is in the Bill comes into operation. That is the opposite extreme of how a cap operates, but more people in Britain may be interested in the answer to that question than in the answer to the question of how to treat those families who are lucky enough to have an annual income greater than some continental European countries.

Steve Webb (Liberal Democrat, Northavon)

Amendments Nos. 87 and 88 raise two interesting issues. Amendment No. 87 provides that the absent parent, no matter how rich, continues to pay a percentage in child maintenance. Amendment No. 88—to which the hon. Member for Brentwood and Ongar (Mr. Pickles) referred, but not in as much detail as I expected—deals with the situation where the mother is better off than the absent father. In considering the amendments, we were struck by the fact that they represent opposite logics. Our guiding principle in deciding which way to vote on an amendment is whether it would help to maintain what a child would have experienced had the parents stayed together. That seemed a reasonable way to evaluate the amendments. On amendment No. 87, the answer is no, and on amendment No. 88, yes. Let me explain what I mean. Had the rich dad—for simplicity's sake—stayed with the family, the child would have benefited. Maintenance is not just about food and clothing; it is about living standards and quality of life. If a child loses the presence of the dad, is it reasonable to expect them to lose the living standard provided by a well-off dad, or a dad who becomes well off? Had the dad remained and earned a bonus or a good salary, the family might have gone to Disneyland, or wherever.

Eric Pickles (Conservative, Brentwood and Ongar)

Is the hon. Gentleman concerned that the Bill provides no way of ensuring that such money is transferred to the child?

Steve Webb (Liberal Democrat, Northavon)

Short of putting the money in trust, which would be a possibility, we have to assume that the parents will want to act in the child's best interest, so I have no particular problem with the lack of a mechanism for benefiting the child. Different issues arise if the dad becomes rich after the break up, but if he was rich while the family were together, the child will have had a high material standard of living. Therefore, after a break up, not only does the child lose the dad but there is a slump in the standard of living, which is something else to adjust to.

Steve Webb (Liberal Democrat, Northavon)

Obviously, the father does lose the child. We all encounter fathers in our surgeries who feel that pain greatly and have great concerns about access and other issues, but I am not convinced that a monetary adjustment is the right way to deal with that problem. Court decisions on welfare and access are important in that regard, but I am not convinced that tweaking the formula can compensate. I do not suggest that we compensate the child for the loss of the father through money either; I am simply trying to avoid further pain for the child. Therefore, I am not convinced that a cap would make sense. There may be a few headline cases, although, as has been suggested, the Bill Gates of this world will have good lawyers and, just as they will probably avoid paying much tax, they will probably find a way round provisions such as this, so they may never be affected. We have more sympathy with the rich mum, poor dad situation, where there is more obviously a potential sense of injustice when a dad with a modest income pays maintenance when the mother is well able to provide the child with all that it needs. The loss of money from the dad leaving may be small and there will be one less mouth to feed. I am aware that research shows that, after a split, the family with the children is usually the worst off, but we are dealing here with the opposite case, where the mother is relatively well off, where, after the split, there is one less mouth to feed and the loss of only a modest income, so the family may be better off. It is not unreasonable that that may be taken into account in the maintenance assessment. Therefore, we have some sympathy with amendment No. 88 but not with amendment No. 87. Amendments Nos. 2 to 5, tabled by the Liberal Democrats, relate to one issue and touch on the different set of circumstances of the absent parent, typically the dad, who is on benefits. Schedule 1 says that dads on benefit would probably pay a fiver, which they would not presently be paying. If I am wrong, I hope that the Minister will stop me, otherwise I shall assume that that is the case. Is it right to take that fiver a week from an absent parent on benefits? The Government's approach is to say that pretty well everyone should pay something, as much for the symbolism of it as anything else. It is a point of principle, but my problem is that the Government, in so many things that they do, cause people to live below the poverty line by digging away at their basic benefit level. I would argue that the £50 a week received on income-based jobseeker's allowance is an extraordinarily minimal sum on which to live. It is certainly not enough to save with, so lump sum purchases require a social fund loan, or something like that. A fiver may not sound much to us, but it could be 10 per cent. of a weekly income. I am not convinced that the symbolism of saying that everyone must pay something justifies the poverty that will be created for absent parents in such a situation. The effect of amendment Nos. 2 to 5, on which we shall divide the House because they represent an important and distinct issue, is to move absent parents on benefit from the category of those who have to pay a fiver into the category of those who are subject to the nil rate. I give the House an illustration of why we are particularly concerned about deductions from benefits. The "Income Support Statistics Quarterly Enquiry February 1999"—perhaps not the latest, but the latest that I have to hand—gives the number of people on benefits who already have something deducted at source. In other words, they are already getting by on a weekly income below basic benefit levels. The astonishing figure here is that more than 1 million income support claimants are already living below basic income support levels because something has been taken away at source. Various categories of money are taken away at source, some of which tell one something about the standard of living. For example, in some cases mortgage interest comes from income support at source, and that is just an accounting feature. The money goes direct to the lender instead of it going to the claimant and the claimant paying it out, so that does not directly mean that they are living below the poverty line. About 600,000 people on income support have social fund loan repayments deducted from their basic benefits. One might say that they have had the money with which they bought the bed, cooker, fridge or whatever, but that money has gone on those purchases, so it is not then available for buying food, clothing and basic necessities. The basic income support level is minimal enough as it is, with no slack in it, so many people on income support end up going to money lenders and loan sharks. Pushing them further below income support by schedule 1 is a cause for concern. Categories are always being added to such deductions, which take people below the income support line, and the social fund line in the table has been shooting up. In his Budget statement, the Chancellor told the House that there has been year after year of continuous economic growth. One would therefore assume that the numbers would start to drop as jobs were created. Unemployment decreased substantially over that period. Yet, according to the table, in the past four years, the number of people who live below the poverty line because of social fund loan repayments has increased from approximately 450,000 to 600,000. The number has increased in each of the past four years. There is an underlying serious problem: more and more of our fellow citizens live below the poverty line because of deductions from benefit. Without our amendments, schedule 1 will exacerbate the problem. That is the kernel of our argument. We have reached a position in which people cannot get social fund loans because they are deemed too poor to repay them. That is extraordinary, yet the system works in that way. People are becoming deeply indebted to the social fund and to loan sharks, yet we are considering a schedule that will deduct another fiver. I accept that not many of the dads whom we are considering are in those categories. However, many are lone parents who are repaying social fund loans, and some are pensioners or disabled. Some dads will be on incapacity benefit and repaying social fund loans. I hope that the Minister will explain how those people are supposed to live. I presume that the fiver a week will be paid indefinitely. The problem with inadequate benefits is not living on them for a week. Members of Parliament often do a stunt and live on benefit for a week. Lo and behold, they can do it for that time. The problems arise when, for example, a consumer durable has to be replaced. The deduction of a fiver a week will make matters even worse. I hope that the Minister can clarify a further point. When an absent parent has a child in a new benefit unit, will the deduction of a fiver continue? The Government talk about eliminating child poverty completely in 20 years. They envisage a time when the Secretary of State for Social Security will say that no child in this country lives in poverty. Yet children who are in benefit units and live below income support levels because of deductions for social fund loans or child support maintenance premiums will suffer. Even a fiver means that those children will live in poverty. I hope that the Minister will reconsider the £5 deduction and answer the specific question of whether the Government intend to take £5 from absent parents with dependant children.

Edward Leigh (Conservative, Gainsborough)

I have listened to the hon. Member for Northavon (Mr. Webb), and as always he presents a good and cogent argument. I do not agree with him although I accept his point that we are considering many fathers who are on income support and for whom £5, although it seems a small amount of money to care for a child, may be a severe imposition. I understand those points. However, I am sure that the hon. Gentleman recognises the counter argument. We are using the Bill to try to create a society in which people get the message that they have rights and responsibilities. If one fathers a child, surely it is not too much to ask for £5 a week, whatever one's circumstances? I support the Government on that point, whatever the difficulties that may accrue from it.

Steve Webb (Liberal Democrat, Northavon)

The hon. Gentleman uses the phrase "father a child". Let us consider the following sequence of events: a happily married couple have a child and they split up, with no blame attached—or perhaps with no blame attached to the absent parent, who is unemployed through no fault of his own and has to live on £50 a week. Is it right that he should pay 10 per cent. of his income, which he cannot afford, because he needs that money on which to live? In those circumstances, the father has done nothing wrong.

Edward Leigh (Conservative, Gainsborough)

I make it clear that I do not want to be involved in a blame game, in which we assume that the father is always in the wrong. In many circumstances, the father is not to blame. I cannot give a definite answer to the hon. Gentleman's question. It may not be entirely right to make a father in the circumstances that the hon. Gentleman described pay £5 a week. However, we cannot make provisions that are always right; we simply have to make a stab at a problem. The Government are trying to send a message that even though the father is not to blame for the family splitting up, and his income has fallen below a low level, he should pay something. If the parent pays nothing, not even £5 a week, it is difficult to maintain real control of what is happening. At least a parent who pays £5 a week is involved in the family finances of the absent child. It could therefore be in the father's interest to pay that sum. However severe a financial penalty it may be in the short term, in the long run, the father's continuing involvement in the child's financial maintenance may be best for child and father. The debate is interesting, because on the one hand I have been having one sort of argument with the hon. Member for Northavon for the past four minutes, and on the other, we have talked about Bill Gates. The debate is about the child's rights to a share of his parent's income and whether that should be calculated on a percentage basis or whether there should be a cap. The debate on the cap is interesting because I suspect that the Government were genuinely divided about whether to provide for it. Baroness Hollis's reply to me in the Select Committee on Social Security has already been mentioned. She was obviously debating with herself as a Minister about whether there should be a cap. She said: I think this is a question on which we thought long and hard and I think there are good, strong arguments on both sides. There is one argument saying that you should cap it because it is child maintenance and if it goes all the way up the income scale, it becomes spousal maintenance … My hon. Friend the Member for Brentwood and Ongar (Mr. Pickles) made that point. The Minister is aware of it, and I hope that she will share her thoughts with us. It would be dangerous if the payment were regarded as spousal maintenance. Absurd circumstances could arise. We have considered the Bill Gates position, in which someone of considerable resources hands over enormous sums of money. Let us consider the circumstances of two families that split up: in one case, there are children; in the other, there are no children, and there is a grotesque difference in the amount of spousal maintenance. If the proposal is accepted and there is no cap, the husband in the first case will pay 15 per cent. of his income, whatever it is. In the second, normal divorce law and procedures of the courts apply. There is no rule that provides that if there are no children, one of the partners is entitled to 15 per cent. of the other's wages. Extraordinary discrepancies could arise. We are getting into a muddle. Although I appreciate the debate within government, Ministers should consider carefully before they reject the arguments that my hon. Friend the Member for Brentwood and Ongar presented. I do not want to give the impression that Baroness Hollis simply agreed with me. However, she continued with the argument that she had with herself by saying: and the other argument is that if that family were intact, the child would enjoy the living standard of that father whatever his income, whether he was earning £200 a week or £2,000 a week, and at the end of the day in response after listening to the consultation exercise and talking with people and meeting the 40 groups and organisations, we came out on the side of saying that we should not have a cap, but obviously it is the sort of issue that Parliament will want to explore and take a view on. That is precisely what we are doing, and what we tried to do in the Select Committee and in the Standing Committee. The problem revolves around the issue of whether the child has the right to his father's income. However, in a way Baroness Hollis was wrong when she said if that family were intact, the child would enjoy the living standard of that father whatever his income … As we all know—indeed, there is hardly any need to say it—there is no right to any percentage or share of the father's income, which can go up or down, if the family is intact. It is not necessarily shared with the child, and I am not sure that it is right that children should always enjoy a share of a parent's income if the family remains intact. It would be a strange legal system if that happened. Families Need Fathers put the case well in its evidence to us, which is on page 135 of the Select Committee report: Why should the state determine how much fathers should pay for their non-resident child when it does not involve the taxpayer? It would be considered an intolerable assault on personal liberty if it happened in a couple family. That is a powerful argument. In a way, my hon. Friend the Member for Brentwood and Ongar did us a disservice by mentioning Bill Gates as his story, although good and amusing, gave the impression that few people will be affected by the proposal. However, quite a few people who in no sense rely on state benefits and pursue normal lives could be affected, because they have suffered the misfortune of a marriage or relationship break-up. Now the state comes in, uniquely in this area, to say, "We must determine how much fathers should pay their non-resident child."

Eric Pickles (Conservative, Brentwood and Ongar)

My hon. Friend is right to castigate me. I used the Bill Gates story to illustrate a point and make the proposal look ridiculous, but it will bite significantly at about £45,000 a year and people on moderate to medium earnings will be affected.

Edward Leigh (Conservative, Gainsborough)

I am pleased that my hon. Friend has intervened, because we are beginning to have a real debate. Incomes of £40,000 or £45,000 are middle management incomes in many areas. [Interruption.] Needless to say, Members of Parliament earn such a sum. Large numbers of people will be affected. The public have not cottoned on, but there will be a great deal of resentment if people suddenly find that, irrespective of what happened in their marriage or irrespective of a former partner's position, they have to hand over £10,000, £15,000 or £20,000, which they might consider a very large sum, to maintain a child. They will think that the money will not all go to the child—there is a limit—and they would be right. If people send their children to expensive public schools and give them everything they want, which may not be good for them anyway, perhaps they can spend £15,000, £20,000 or £25,000 a year on a child. However, many people will think that the money will not go to the child, but will simply reinforce the life style of the former spouse. Of course the money will not go to the child; nor will it be put in trust. If it were, that might be fairer. There will be enormous resentment. As Families Need Fathers said in evidence, people consider the proposal a grotesque intrusion on personal liberty and it would never be tolerated if a couple were still together. The evidence was moderately put and sensible. I hope that hon. Members will not groan if I mention Mr. Mostyn, although they often do so when we pray him in aid of our arguments. [HON. MEMBERS: "Him again."] He practices in the divorce courts and we might think that he knows what he is talking about. He does not practice in cases such as those to which the hon. Member for Northavon referred and he did not talk about people on lower incomes, but he did mention parents earning £40,000, £50,000, £60,000 or £70,000 a year. There are a lot of them around. They may be a minority and they may not be the Government's first concern, but the fact that they are a minority and the fact that there are far fewer of them than people in the lower income brackets does not mean that they do not have rights. They, too, have rights. They have the right to talk about their problems and to speak up about them. On page 83 of the evidence, Mr. Nicholas Mostyn told us: In terms of English law and social experience it would be a change of massive social profundity. It will go beyond, for example, the Roman law idea of legitim, which is your guaranteed right of inheritance. It will go beyond that because it would be inter vivos It seems to me that you have got to understand the profundity of what you are suggesting. Perhaps he overstated his case, but not in this sense: the proposal represents an enormous change in respect of anything that we have instituted previously. Before we finish the debate, we must be clear about what we are putting on the statute book. We are saying that, leaving aside inheritance, children in certain circumstances will have an absolute right under statute law to a proportion of a parent's income. That is an interesting departure and we know precisely what will happen. The proposal does not concern only CSA cases because the courts will follow the CSA—there can be no doubt about that—and very soon people will wake up to what is happening under the Bill. They will immediately try to reopen settlements. People who received a court settlement of £3,000 or £4,000 a year, supposedly for a child, after their relationship broke down will rush to the court straight away when they realise that their former spouse earns £100,000 or £150,000 a year and that they can get a 15 per cent. share of that. That will happen, and it will be impossible for the courts to resist. A lot of cases will be reopened. On a philosophical rather than a practical point, does the House of Commons want to create an absurd situation in which children will think that they have a statutory right to a certain proportion of a parent's income? Conceivably, that could lead to absurd cases in which children sue their parents for that share. We are creating a politically correct notion that most of us in the Chamber would regard as absurd, but the Government will defend themselves by saying, "That is not what we propose. We are not trying to create a new situation in which children have that right." Very reasonably, they say that children will still have a right to share in the income of an absent parent when the parents' relationship breaks down. Everybody thinks, "Oh, that is very sensible," but when we dig down and consider the proposal in more detail we see that it will produce the absurd situations that my hon. Friend the Member for Brentwood and Ongar described. I hope that the Government will not think that our arguments are partisan or motivated by party politics. They are perfectly sensible and reasonable points and, as the Bill continues its passage, I hope that they will come to consider some sort of cap sensible and necessary.

Desmond Swayne (Conservative, New Forest West)

My hon. Friends the Members for Gainsborough (Mr. Leigh) and for Brentwood and Ongar (Mr. Pickles) seem to be most put out by the creation of the new right to a proportion of a parent's income. I am not sure whether my hon. Friend the Member for Brentwood and Ongar is more excised over the creation of that right in itself—I am not disposed to the creation of new rights in respect of the rights of the child, that whole area of political correctness, but we must meet people's legitimate expectations—or over the fact that it is available only to those children whose families are no longer intact. That does not strike me as such a reprehensible state of affairs. Children have a legitimate expectation of a childhood of a certain standard, and of parenthood during that childhood. That legitimate expectation has been denied, and I do not think it entirely inappropriate for compensation to be provided in the form of a new right—the right to a proportion of one parent's income in lieu of the legitimate expectation that has been denied. Before my hon. Friend begins to fear that I shall enter the other Lobby, let me say that I thought he was on stronger ground when he said that there was no mechanism for the delivery of payment to the child. That, I think, is the nub of the problem, and the strength of the amendments. There is a view, or a perception, on the part of those making the payments that they will be subsidising the living standards of the parent with care. That has created a burning sense of grievance, which is compounded when the income of the parent with care is higher than that of the non-resident parent. I believe that the feeling of injustice created by the forces to which I have referred will lead to a reduction in compliance, which, after all, is one of the great targets of the Bill. For that reason alone, I support the amendment.

Angela Eagle (Labour, Wallasey)

We have rehearsed many of the arguments that were presented at length in Committee, but Bill Gates has now been prayed in aid. I assume that the £53 billion assessment made by the hon. Member for Brentwood and Ongar (Mr. Pickles) related to Bill Gates's entire wealth, rather than his annual income. We must remember that the child support mechanism deals with net taxable income, rather than the wealth that could be deemed to have accrued over an individual's lifetime.

Eric Pickles (Conservative, Brentwood and Ongar)

At £53 billion, who cares?

Angela Eagle (Labour, Wallasey)

That is probably fair comment, but I thought I should point out that we are discussing net taxable income rather than the amount that a person is worth overall. We should also bear in mind that there is a cap, in that a non-resident parent will in no circumstances have to contribute more than 25 per cent. of his or her net taxable income. The Government concentrated on that in trying to simplify the system. Lady Hollis shared some of her thoughts with the Select Committee, and the hon. Member for Gainsborough (Mr. Leigh) has cited them here, owing to their relevance to the Government's thinking. We have engaged in various debates, but we still believe that we are doing the right thing, and that introducing an upper limit would lead to an inconsistency between the treatment of non-resident parents with relatively high incomes and that of parents receiving more modest sums. I think that the hon. Member for Northavon (Mr. Webb), who wrestled publicly with the difficulties with which we are all trying to deal, was right to concentrate on living standards rather than incomes for children. We are not talking merely about set incomes, and what goes to particular children. We are not talking just about food and clothing. In Committee, the hon. Member for Gainsborough said that no children, even those living in well-off households, would, in a mathematical sense, have exactly equal shares of the income involved. I hope that the hon. Gentleman does not keep his children in the garage: I trust that they live in the house, and share in the general standard of income.

Edward Leigh (Conservative, Gainsborough)

My kids are probably in the garage.

Angela Eagle (Labour, Wallasey)

They may prefer to play in the garage to get out of the hon. Gentleman's way, but I presume and hope that he does not keep them there permanently. Amendment No. 88 seeks to reduce the amount of maintenance payable under the maintenance calculation when the net income of the parent with care exceeds that of the non-resident parent. Let me explain the basic structure of the incomes of parents with care in the current CSA case load. Of those parents, 677,000 have no earned income; 84,000 earn less than £100 a week; 6,900 earn more than £200 a week; only 580 earn more than £350 a week, and only 200 earn more than £500 a week. The vast majority of parents with care have only a modest income, and have been left to look after the children. According to the CSA structure, the non-resident parent has a duty to ensure that the children whom he has fathered are looked after properly, and to be financially responsible for their continued maintenance—to the extent that he can be, given the test applied to his income. It is almost always women with low incomes who are left to look after the children. Amendment No. 88 would require a huge increase in means testing, and the Conservatives have already told us that they are opposed to that. In seeking to simplify the CSA formula, we aim to abolish means-testing of the parent with care and, perhaps, the means-testing of her partner, the non-resident parent's new partner and so forth. If amendment No. 88 were adopted, the CSA would have nearly 1 million cases on its books by the time that the reform was introduced. The amendment requires the CSA, instead of applying one simple, quick means test to the non-resident parent, to apply four means tests per case to establish the income of the new partner of the non-resident parent, as well as that of the new partner of the parent with care if such a person exists. The amendment would reintroduce a huge amount of means testing in a very few cases, and would destroy all the simplicity that has been introduced. It would return us to the problem that we face now: the problem of ensuring that the right balance exists between the need to make a maintenance assessment quickly and simply, and the need to spend time enforcing it. The Liberal Democrat proposals deal with the basic payment of £5 that the Bill introduces for all non-resident parents, regardless of whether they are receiving benefit. I understand the worries expressed by the hon. Member for Northavon about people on low incomes: that is why the Bill introduces different levels of payments, including a minimum payment for those whose incomes are below £100 a week. It does not specify percentages, but it provides for that £5 minimum. We think that all fathers, except in a few circumstances—when they are still at school or in prison—should make some payments. Amendments Nos. 2, 3, 4 and 5 seek to introduce a radical change. They require a nil rate of liability when a non-resident parent or his partner receives a benefit prescribed for the purposes of the legislation. They also provide for the flat rate to be specified in regulations when a non-resident parent has income of £100 a week or less and has a partner who is also liable for child support. I can reassure Members that special provision will be made for the flat rate when a non-resident parent on an income-related benefit has a partner who is also liable for child support. The intention is for the flat rate payable by each member of a couple receiving income support, or income-based jobseeker's allowance, to be half the standard flat rate. The £5 minimum is a maximum as well: it can be split equally and £2.50 can go to each child. However, it cannot become £10. I hope that that offers some reassurance. The exemptions in respect of payment of contributions for maintenance have been removed. The current scheme exempts some people with quite high incomes. All fathers, whether on benefit or in work, have a responsibility to contribute to their child's upkeep, but we recognise that a simple percentage calculation does not adequately reflect the difficulties that are faced by those on low incomes—hence the £5. It is important to keep in mind another key part of our child support reforms: the introduction of the child maintenance premium, ensuring that the money that is paid—all £5 of it—goes directly to the child. It is not, in that sense, a Treasury support agency, which has been one of the major objections and reasons why people on benefits do not pay. The hon. Member for Brentwood and Ongar mentioned social fund users. He was gracious enough to admit that the vast majority—in fact, it is not the vast majority, but a large proportion—of social fund users are women on income support, who will benefit from the £10 maintenance disregard when benefit is paid. Under his amendments, they would not: they would not receive the maintenance disregard because they would not receive any maintenance. There is an evening out. I hope that Members will oppose all the amendments.

Eric Pickles (Conservative, Brentwood and Ongar)

I beg to ask leave to withdraw amendment No. 87, but with your permission, Mr. Deputy Speaker, to divide the House on amendment No. 88.

Jeff Rooker (Labour, Birmingham, Perry Barr)

I beg to move amendment No. 48, in page 85, line 23, leave out from "7(4)" to "or" in line 24 and insert— '(or that Table as modified pursuant to regulations made under paragraph 10A(2)(a)),'.

Michael Lord (Deputy Speaker, Central Suffolk and North Ipswich)

With this it will be convenient to discuss Government amendments Nos. 37, 38, 44, 53, 57, 39, 41, 49 to 52, 58, 60, 61 and 45 to 47.

Jeff Rooker (Labour, Birmingham, Perry Barr)

This group of amendments serves two purposes. First, it improves the Bill's drafting, to ensure that the Bill does what we intended and its provisions work. Secondly, it makes some consequential amendments to other Acts. Some of the changes are more significant than others, and I shall spend a very short time describing in some detail the amendments that I think will be of interest. Amendment No. 38 will close a loophole that allows non-resident fathers of children whose birth was registered in Northern Ireland to delay payment of child support by denying that they are the child's father. It makes changes to provisions that enable the Child Support Agency to presume paternity. Articles 14 and 18(1)(b)(ii) of the Births and Deaths Registration (Northern Ireland) Order 1976 mirror provisions in sections 10 and 10A of the Births and Deaths Registration Act 1953, which applies in England and Wales. Clause 15 of the Bill aligns English and Welsh provisions with those in Scotland. That is why we intend to allow the CSA to presume that any non-resident parent living in England and Wales is the child's father if he was registered as the father in Northern Ireland. Amendment No. 44 replaces the existing subsection (3) of the new section 55A on declarations of status, inserted into the Family Law Act 1986 by clause 76 of the Bill, with a new provision that achieves the same effect, but in a much clearer way. The rest of the amendments in this group fall equally into three broad groups. The first group is composed of minor drafting changes that ensure that the Bill works as we intended and picks up minor errors in the text. The second group is composed of consequential changes that make necessary amendments to other Acts in England, Wales and Scotland, to reflect the new provisions of the child support legislation. Some other Acts refer to child support. The Army Act 1955, for example, provides for how child support will be deducted from a serviceman's pay. Changes in the child support provisions must, therefore, be reflected in that legislation. The final group deals with legislation that is being repealed. It is usual practice to repeal provisions in other Acts that are made redundant by new child support legislation. I hope that the House will accept that these amendments are sensible and necessary to ensure that the legislation works properly and as intended. I commend them to the House.

Andrew George (Liberal Democrat, St Ives)

I beg to move amendment No. 1, in page 3, line 1, leave out Clause 2.

Michael Lord (Deputy Speaker, Central Suffolk and North Ipswich)

With this it will be convenient to discuss amendment No. 77, in clause 2, page 3, line 9, at end insert— '(4) In section 8(3) of the 1991 Act the word "vary" shall be deleted where it appears after the words "it would otherwise have to make,".'.

Andrew George (Liberal Democrat, St Ives)

The Minister said, perhaps correctly, that there was a possibility that amendment No. 76 was not technically up to standard. With this opportunity for sober second thought, we should ensure that, while we are trying to put right past mistakes, we do not maintain the current legislative fiasco—which is what Parliament has achieved on the past few occasions when we have addressed the issue—in child support. The purpose of amendments Nos. 1 and 77 is to provide us with every opportunity to ensure that pressure is taken off the CSA, and that the court welfare system can be used not to replace, but to aid and support, the CSA. Use of the court welfare system should at least help in preventing the CSA from taking the full brunt and burden of child support work. Current CSA legislation allows for an agreement between the parent with care and the non-resident parent to be incorporated into a court order where the two parents are able to reach an agreement. This is a valuable and greatly used provision, which allows for negotiation between parents and relieves the CSA of work. Clause 2 would effectively remove that provision. Any agreement reached and fixed in a court order will be capable of being overturned after a year, which would make a mockery of the court order. The new clause would allow parents who believe that they can do better out of the CSA to break the agreement in the court order. This runs counter to developments in Europe, and in matters relating to children and finances generally. The overwhelming trend is towards mediation and discussion, and the use—as far as possible—of agreement between both sides. There are numerous situations where parents may want to opt out of the CSA system. One might be when parents agree that the payments for the children would be greater than the CSA would assess. Often, this is as a result of a trade-off. The parent with care may make no maintenance claim for herself in return for a better payment regime for the child or children. A second example might be where parents agree to a lesser sum than the CSA would prescribe; for example, the non-resident parent may transfer capital or the house to enable the parent with care and the children to remain housed, with the mother accepting a lesser level of maintenance in return. Approval by courts for parental agreements protects both parents from being pressurised and provides an established and straightforward system. There are no apparent benefits from building into a court system a get-out provision which can produce reasonable and realistic maintenance agreements. In amendment No. 77, we seek to retain the court as a viable option, while not denying the powers of the CSA, by giving the court the power to vary a court order and thus giving the court order a longer shelf-life. Some families will insist that they wish to base their financial arrangements not around the hazards of the CSA system as they see it—certainly, past practice would suggest that they would be right—but around an assumption, for example, that they will look at the global costs of a child from time to time, and meet them in certain percentages. The scheme is increasingly common, particularly as more and more settlements result from mediation; a trend which is to be welcomed. This is a way in which parents can continue to be involved in the parenting of their children after separation, and it is a child-centred scheme. Such parents will be advised that they cannot opt out of the CSA scheme. Either has the right, after one year, to approach the CSA—a process that will lead to a standard assessment and the termination of the court order. Such parents may wish to make legally binding promises to repay any sums above—or, for other parents, below—the court order, with penalties. That will be a powerful disincentive to approach the CSA.

Simon Burns (Conservative, West Chelmsford)

What confidence does the hon. Gentleman have that his amendment would not lead to a return to the problems before the CSA, when courts awarded different amounts, some of which were ludicrously small and not in the interests of the mother?

Andrew George (Liberal Democrat, St Ives)

The hon. Gentleman's intervention is fair and reasonable, and it is clear that these amendments provide an opportunity for a second thought before proceeding in the rather draconian way that is proposed. We do not propose to go back to the vagaries and failures of the past, but, rather, to go forward to a system that takes into account the failures of the CSA. If the hon. Gentleman is saying that the CSA is providing a sound basis for child support and represents a success, most hon. Members would disagree.

Simon Burns (Conservative, West Chelmsford)

Success is a difficult thing to assess accurately but, with all its flaws, the current CSA has been a better mechanism for calculating a more realistic level of child maintenance than the old court system was. It is not a question of going back to something that has failed. If we go back too far—to the courts—mothers would be infinitely worse off than they are even under the existing regime.

Andrew George (Liberal Democrat, St Ives)

That is a fair point, but we are not talking about going back. Many of the criticisms of the past system are fair, but we are proposing to go forward. There is no reason why courts could not set guidelines for the settlement of arrangements between the parent with care and the non-resident parent in the same way as the court does in many other areas.

Angela Eagle (Labour, Wallasey)

Would the hon. Gentleman share with the House how the Liberal Democrats are proposing to move forward? The hon. Member for West Chelmsford (Mr. Burns) is quite right; the court system has failed in the past to provide adequate maintenance for many children. Could he spend a little time letting us know how on earth the Liberal Democrats propose to make the courts work?

Andrew George (Liberal Democrat, St Ives)

That is rather outside the terms and the spirit of the amendment. The Minister may like to reflect on the broad points before we simply hand too much work to an agency that has shown that it is incapable of coping with its present work load. We have tabled probing amendments, which should be welcomed if they provide a caveat to the Government to take some of the pressure off an overburdened CSA.

Andrew Dismore (Labour, Hendon)

Bearing in mind the hon. Gentleman's comments about the CSA's ability to cope with the volume of work, what discussions has the hon. Gentleman had with the court service about its potentially having to handle a million-plus cases? What discussions has he had with the Lord Chancellor's Department about how such cases should be financed—for example, the burden on the legal aid budget?

Andrew George (Liberal Democrat, St Ives)

We have had discussions with a variety of organisations. I have laid out the justification for our proposals, and Conservative and Labour Members have sniped at that. The purpose of the amendments is clear and, before this House passes the Bill to another place, it is right for us to give an opportunity for reflection on whether the court welfare system might come to the support of the CSA.

Simon Burns (Conservative, West Chelmsford)

I listened to the hon. Member for St. Ives (Mr. George) with great interest and care. He rightly said in his concluding remarks that he is entitled, at this stage in the Bill's proceedings, to put forward suggestions for us to consider and accept or reject. I suspect that Ministers will reject them, and I hope that they do. I have no doubt that the hon. Gentleman means well, but the amendment would turn back the clock to the bad old days. That would not help carers of children, most of whom would be mothers on benefit. However, it would be very popular with those absent parents—usually fathers—who want to escape or to minimise their financial responsibilities. Before I say any more, I should declare an interest. I pay child maintenance. I do not do so under the auspices of the CSA, although sometimes I wish that I did. Labour and Liberal Democrat Members may have criticisms of the CSA as it was set up before this Government reformed it, but the formula was devised with the best of intentions. It was complicated, but the intention was to secure as fair a deal for parents as was possible in the circumstances. That applied both to absent parents and to the ones who looked after the children. The self-evident problem was that, in trying to be fair, the previous Conservative Government devised a system that was so complex that it fell into disrepute almost from the beginning. That was partly because of its complexity, and partly because certain people wanted to ensure that the system did not work. The Government's alternative is based on the principles of the CSA. Its benchmarks are simplicity and transparency. Over the coming months and years, we will find out whether that finds greater acceptance among parents of children who have to pay child maintenance through the auspices of the CSA. The jury is out, and will remain out for some time, on the question of whether the Government have got the thing right. The hon. Member for St. Ives wants to change the Bill to reintroduce a court service. His aims and aspirations may be well intentioned, but he risks doing a great disservice to parents who care for children after a marriage or relationship breaks down. I say that because the courts were singularly inept in their calculation of child maintenance under the old court regime. That was owing to wide variations across the country in the cost of bringing up children. The extent of those variations was not proportional to distance. People ordered to pay £10 a week to bring up a child—even in those days, that was a ludicrous amount—felt aggrieved when they discovered that others in similar or better financial circumstances in terms of income were expected to pay even less. The disparities between awards were ludicrous. Furthermore, the enforcement of the awards that were made was haphazard. Courts sometimes made realistic assessments of the amount of money that absent parents should pay towards bringing up their children, but those absent parents often paid no money at all, or only a little. As a result, mothers had to face the expense and the time-consuming problems associated with going back to court to get an order enforcing payment. In addition, if absent parents were emphatic about dodging payment, they could string the court system along with 101 explanations of changed financial circumstances. That archaic system could easily be abused or interfered with by people determined not to pay, and it is not a good idea to return to it. The courts have to make decisions using evidence about income and other matters that is given to them on the day of a hearing. The hon. Member for St. Ives said that guidance and guidelines could be set down, but they would not help to establish a system that most of the people involved would perceive to be fair and workable. The hon. Gentleman then said that, after a year, parents could go to the CSA for what in effect would be justice. Why delay for a year? A year is a long time for a parent bringing up children on a low income and with all the anguish associated with the break-up of a relationship. Parents in that position would have to go to court to try to secure an income for their children, and they would also have to go through the nightmare of watching their former partners refusing to pay or front-loading their expenses to ensure that only an insultingly small amount was paid in the end. According to the amendment, after a year of that, parents would have the option to revert to the CSA. I point out to the hon. Member for St. Ives that the Government's proposals mean that they could have turned to the CSA immediately—as they could have done under the slightly different provisions introduced by the previous Conservative Government. When courts determine child support levels, the amounts vary significantly between families. The system put in place by the state ensures that the taxpayer does not have to foot the bill that one parent in a relationship does not want to pay. It also ensures greater consistency in the amounts being paid. That consistency will appear fairer to those who resort to the state system. The proposal is well meaning but it does not address the difficulty. It would pose infinitely more problems for parents with care than the hon. Member for St. Ives either cares to admit or believes would be the case. Such a retrogressive step—going back to a system that was thrown out because the country would not tolerate it—would help no one.

Steve Webb (Liberal Democrat, Northavon)

The hon. Member for West Chelmsford (Mr. Burns) raises some important concerns about a court-based system. They need to be answered, and I hope to build my response on the contribution from my hon. Friend the Member for St. Ives (Mr. George). This issue is central to the Bill. When we debated it first, I recall that the Secretary of State said that only lawyers and Liberals want to go back to the courts. Yet the Department of Social Security pays academics such as Professor Jonathan Bradshaw of York university to do research on lone parents and absent parents. Professor Bradshaw is probably the country's leading academic expert on the problem of absent parents. Speaking about the Bill, he said that the Government had got it wrong. He said that it was a mistake to go for a rigid approach and that a court-based system allowing flexibility in individual cases was the right option. I have checked and I am not aware that Professor Bradshaw is either a lawyer or a Liberal. He has no party political axe to grind and the Department pays him to study these matters. His research has led him to conclude that the Bill's rigid, rough-justice system is not necessarily the best strategy for the Government to adopt. I offer that as a third-party endorsement. 8 pm When the Secretary of State tried to rubbish our proposals on Second Reading, he put a costing on them. Given that there seems to be some uncertainty as to what our proposals are, how did the right hon. Gentleman tell his civil servants to cost them? It shows how far-fetched that exercise was. For the benefit of the House and of the hon. Member for West Chelmsford (Mr. Burns), who raised some perfectly legitimate concerns, let me flesh out our proposals. The hon. Gentleman raised two justified criticisms about the court-based system—relating to variability and enforcement. My hon. Friend the Member for St. Ives mentioned guidelines, which the hon. Gentleman did not believe went far enough. The courts are used to deciding on the merits of an individual case within guidelines—sentencing is the relevant analogy. The courts use guidelines to decide a specific sentence for a specific case. Sentencing guidelines can be wide, and we may not want such wide parameters for child maintenance, but an absence of variability would not produce the fairness that the hon. Gentleman seeks. He said, if I remember rightly, that the system must be seen to be fair. Although wide variations do not create a sense of fairness, neither does treating unlike cases in a like manner. Let me give the hon. Gentleman an example, which is loosely based on a constituency case. I have talked about this in the House before, and have never had a clear response from a Minister. A father in a couple enters into a commitment in anticipation of his marriage continuing. He gets a new job which he has to drive to, so he takes on a car loan. The couple then splits up. He has the continuing obligation of the car loan debt to service. If he cannot keep the car, he cannot keep the job and he cannot pay the maintenance. The formula will take no account of that burden. [Interruption.] I think that the hon. Member for Stockport (Ms Coffey) is saying from a sedentary position "Take a bus." I assume that that is a facetious remark. That is an example of how one can take on a commitment in good faith during a partnership that continues after the partnership is over. The new, very rigid formula does not take that into account, but a court, or some other discretionary process, could, without giving carte blanche for variations, allow for people who have good reasons why 15, 20 or 25 per cent. is in nobody's interest. If the person in my example has to pay 25 per cent. after the car loan has been paid, he may have to give up his job. That would be in nobody's interests, and we all care about the interests of children here. We do not want to return to the old court system. The proposed system would give firm guidelines about the base figure, but would leave scope for limited variation in difficult circumstances. The question has been asked: could the courts cope with this burden? Our strategy is that the courts would not be dealing with nine out of 10 cases. The scope for variation would be in the hard cases. There would be a limited number of bases on which one could argue that the percentage was not fair, and those would be handled before a court. People would have their day in court and argue their specific circumstances. Most standard cases would be handled according to a formula through the CSA or the courts. It would cost the same amount of money whoever did the sums, but there would be fallback situation, in which individual circumstances would be taken into account. That is why we think that a court-based system gives a balance between fairness and consistency. On enforcement—

Caroline Flint (Labour, Don Valley)

I want to be clear about the hon. Gentleman's example of the man with the car loan and the children. Surely if the man is in a relationship with children before his relationship breaks up, he is already contributing to their upkeep. Therefore, when he decides to take on a car loan while he is in a relationship, he will take into account the costs of maintaining his children. The children do not disappear before he takes on the car loan, and he should take that into account in his life style.

Steve Webb (Liberal Democrat, Northavon)

I think that the hon. Lady is missing the point. I am not sure whether she was in the Chamber for our earlier debate. In the Division on it, she voted against the proposal that the living standards of the parent with care should feature in the calculation. In the circumstances that I have just described, let us suppose that the father is stretched in paying the car loan out of his own income. The family has managed to maintain the children by using some of the mother's wages. That is how they have squared the circle. After repaying the car loan, the dad may not have much money to pay towards the children's upkeep, but the family has pooled its resources. They cannot do that when the father moves out. He does not necessarily have spare cash.

Simon Thomas (Plaid Cymru, Ceredigion)

Will the hon. Gentleman explain what would happen in the sort of family situation in which I grew up? What happens when the mother is left with loans which she has no way of paying back, and the court system does not deliver an equitable solution until years down the line? Will the hon. Gentleman address that problem in the context of his comments on enforcement?

Steve Webb (Liberal Democrat, Northavon)

The assessment under the Bill will take no account of the factors described by the hon. Gentleman—it will be 15 per cent. The hon. Gentleman's point strengthens my case that in those circumstances the welfare of the child probably demands a higher maintenance figure, but the Bill says that that cannot be done.

Simon Burns (Conservative, West Chelmsford)

Under the amendment, what happens if the mother has caused the breakdown of the relationship by going off with someone else who is reasonably well off? One does not expect the CSA or the courts to take that person's income or wealth into account in paying for the upkeep of the children, but there will be a knock-on effect in, say, the quality of housing to which the mother and children move. In the point made by the hon. Member for Don Valley (Caroline Flint), the car loan is taken into account. What impact will the third party on the mother's side have in the court's calculations under the hon. Gentleman's scheme?

Steve Webb (Liberal Democrat, Northavon)

The hon. Gentleman's example highlights the often complex relationships in all cases. We would need to set out in regulations what the judge was allowed to take into account in exercising discretion. I do not immediately know the right answer on whether the judge should take that into account or how far it should be taken into account. We would need to sit down in a more measured way and ask whether something was legitimate for the court to take it into account.

Simon Burns (Conservative, West Chelmsford)

What happens if the mother goes off with another man, but has got divorced on the two-year basis, so the divorce is not on the grounds of adultery? Does the court take the father's word for it that the mother has committed adultery and gone off with another man?

Steve Webb (Liberal Democrat, Northavon)

The last thing we want to do in setting the child maintenance level, which is about the child's welfare, is to get into the blame game. There is a formula that gives a guideline for what the child maintenance should be. Variations may arise from difference in material circumstances and commitment, but not from who was at fault.

Angela Eagle (Labour, Wallasey)

The hon. Gentleman said earlier that, under his proposal, about nine out of 10 cases would go to the CSA and not to the court. Now he has said that everything is very complicated and every case is different. Does that not mean that every case would, in effect, go before a court?

Steve Webb (Liberal Democrat, Northavon)

The idea is that the formula, whether it is operated by the CSA or the court system, gives a baseline figure. People will say that the figure arrived at is not fair in their circumstances only if certain tests are satisfied. One of those tests will be whether it is thought that there should be a substantial variation in maintenance which is way out of line. The family will not want to go through the hassle of the court system if the variation is minor. The hon. Member for West Chelmsford spoke about a second family, and we all know that there are cases of third families. It is a complex matter. We are simply saying that there should be a baseline figure and individuals should have the right to say, under certain prescribed circumstances, that their case does not fit that, and there should be scope, in the name of fairness, for some variation.

Des Browne (Labour, Kilmarnock and Loudoun)

The hon. Gentleman made a fascinating proposal, which is only now taking flesh as he responds to interventions—indeed, some of us feel that he may be making it up as he goes along. Will he tell us how his system would prevent what happens at present? People who do not want to pay—mostly fathers—create exceptional circumstances by changing their life style so they can get into arguments about departures from the norm and about the reduction of their income. Most of us are anxious that, if we allow too many departures, people will change their expenses regime to become an exceptional case so that they can argue about paying.

Steve Webb (Liberal Democrat, Northavon)

That is a fair comment. There is a balance to be struck between—

Des Browne (Labour, Kilmarnock and Loudoun)

How do we do it?

Steve Webb (Liberal Democrat, Northavon)

The Government do it by taking only one end of the scale. They say there should be complete rigidity, with no reflection of individual circumstances. The example I cited is the case—more or less—of someone who came to my surgery. He had entered into a legitimate expense to keep a job to pay for the children. It is not in the interests of the child to adopt a rigid formula. The dad cannot pay because he has a car loan, so he gives up the job and no one gets anything. How is that fair? How is that in the interests of the child? I do not want to prolong this matter unduly. We are only trying to point out that the Government have chosen one end of the scale. The amendments would allow scope for limited discretion—not as much as in the past—with better enforcement. Enforcement is a problem, although I have not dwelt on that matter. However, there is a good argument that, when people have to fill in court papers, they do not respond as they would if they received papers from a Government agency. There is some—[Interruption.] Hon. Members may question that. My impression is that dealing with the courts, although not foolproof, has more cachet—because people associate courts with punishment—than dealing with a Government agency. There is no evidence that people take CSA paperwork seriously. Plenty of people ignore the CSA more readily than they would ignore the courts. The Government have chosen one extreme; it will create rough justice. We shall have to return to these matters in future Parliaments because there will be so many cases of rough justice. We shall look back to this debate and say that perhaps we should have thought about flexibility rather than instituting a rigid system.

Angela Eagle (Labour, Wallasey)

We have heard an interesting display of busking from the hon. Member for Northavon (Mr. Webb) who made up policy as he went along—apparently from the experience of only one case. I want to share with the House the costs—on our current estimates—of moving back to the courts system. CSA running costs are £220 million a year. The Lord Chancellor's Department advises us that the average net cost of a family proceedings application is £80; for 1 million cases, that would be £80 million. In addition, legal aid would be available; the average legal aid cost for child maintenance proceedings was about £1,700 in 1998–99. Assuming that about 50 per cent. of CSA cases are entitled to legal aid—a generous assumption, as 75 per cent. of parents with care are on benefit—that would amount to £850 million. Assuming only one hour's work on every case—another generous assumption, as most lawyers would tell us—at £200 an hour, the court costs would be £1 billion. The hon. Gentleman proposes that we should create a system that costs five times more than the current CSA system on generous costing assumptions. He has given us no reassurance that the system would be as good as the one that we are trying to reform to make it even more effective.

Steve Webb (Liberal Democrat, Northavon)

As I pointed out, the Department is now trying to cost a scheme about which it claims not to know the details. That is rather odd. I have shown that, in our model, only about 10 per cent. of cases would reach court. Does not that reduce the cost to £100 million?

Angela Eagle (Labour, Wallasey)

I have given the House costs for basic court proceedings on generous assumptions. I suspect that the court costs would soar as the ineffectiveness of the courts became apparent.

Simon Burns (Conservative, West Chelmsford)

Does the Minister agree that, if absent parents had the opportunity to go to court to try their luck at minimising their child maintenance, many of them would take it, because they would have nothing to lose by doing so?

Angela Eagle (Labour, Wallasey)

I agree with the hon. Gentleman. Indeed, I agreed with most of his speech. It is hard to argue that the courts have a good history of dealing with such cases—even the Liberal Democrats have not tried to do that. The courts have an ignoble history in the protection of children in divorce cases. As many people know only too well, the former court system was discretionary and unfair. It left children in poverty and let non-resident parents off the hook. That is why the House chose to move to an administrative system to deal with those issues. Since then, the number of people applying for maintenance through the CSA has continued to rise. The agency has become more effective, although we realise that there are inherent design problems in the maintenance system that the House has asked it to administer. That is why we introduced the Bill, which will radically simplify the formula. It is ridiculous to think that we could go back to the court system and that it would be effective—I suspect that Conservative Members would agree. I remain astonished that the Liberal Democrats do not realise that basic fact. The hon. Member for St. Ives (Mr. George) said that the amendment was a probing one. To delete the whole of clause 2 is a funny way to probe. The amendment would destroy one of the main provisions of the Bill, which would allow people access to the CSA and its services if they found themselves in difficulty with maintenance payments. The Liberal Democrats seemed to have three concerns about our suggested system. The first was that it would allow the CSA to take on new court order cases that had been made at least 12 months after the new child support system was introduced, and that it would be swamped thereby. Last year, 8,100 new court orders involving child maintenance were made. The CSA's annual take on cases is 350,000, so if 8,000 can swamp 350,000, the Liberal Democrats have an odd view of mathematics. The second Liberal Democrat argument was that allowing parents with court orders to use the CSA for a simple and predictable child support calculation would encourage parents to be unco-operative. That argument is difficult to follow, because, since the launch of the CSA in April 1993, courts can make orders for child maintenance only when parents have consented to a written maintenance agreement. That consent must exist before the court can make an order. If new facts subsequently come to light, or the payment arrangements break down, why should a parent not be given the choice of returning to court for the order to be varied or revoked, or of applying to the CSA for a child support maintenance calculation? There is no reason why that should not occur. Thirdly, the Liberal Democrats argued that it would be perverse to unravel satisfactory arrangements and that to do so would be detrimental to children. However, leaving access to the CSA open would not have that effect. Only parents who were dissatisfied with existing arrangements would apply. Our proposal would ensure that maintenance is right for children. Putting the interests of children first has led us down the road of reform of the CSA. Indeed, that created the CSA, even if the agency was not set up in the most appropriate and effective way. We learned as we went along how the administration of the system can be improved. Children will benefit from the provisions in clause 2. The provisions will give parents with court orders the choice between sticking with their existing maintenance arrangements, or asking the CSA to step in. There is also considerable movement on and off benefit. A case that is private on one day can have a taxpayer interest on the next—10 per cent. of people a year move on and off income support and would qualify. Creating a system that deals with children more evenly must be a good way forward. That means that, when the circumstances of parents with care change, there will not be large differences in the maintenance that they can expect to receive. The Liberal Democrats have not even remotely made a case for returning to the courts system. I hope that the House will take a sensible, realistic and hard-headed approach and vote against the amendments.

Andrew George (Liberal Democrat, St Ives)

I guess from the Minister's response that she is not terribly enamoured of our amendment. We have had a reasonable airing of the arguments. Although some hon. Members did not appreciate the seriousness of this very important matter, it is appropriate on Report at least to reflect on the fact that we are missing an opportunity to allow the court welfare system to operate. Having listened to the arguments and taken all things into account, and on balance, I beg to ask leave to withdraw the amendment.

DEPARTURE FROM USUAL RULES FOR CALCULATING MAINTENANCE

Jeff Rooker (Labour, Birmingham, Perry Barr)

I beg to move amendment No. 36, in page 8, line 23, leave out from "11," to end of line 26 and insert— 'and except in prescribed circumstances any appeal connected with it (under section 20) shall lapse.'. I shall be brief, and I hope that the House accepts that. Amendment 36 relates to applications for a variation from the normal rules by which child support maintenance will be calculated. It amends the wording of sub-section (5) of section 28F. Where a variation application is made before a final decision has been reached on the original maintenance application, the Secretary of State will, whenever possible, take the outcome of the variation application into account in reaching his decision on the maintenance application. Where, for whatever reason, he cannot immediately resolve the variation application, he will make an interim maintenance decision under section 12(2). The amendment provides that, once the final decision has been made, any appeal against such an interim decision will normally lapse. That serves to simplify an otherwise quite complex and ludicrous process, under which an appeal would have proceeded against a decision that had subsequently been replaced. I commend the amendment to the House.

SUBSTITUTED SCHEDULES 4A AND 4B TO THE 1991 ACT

Andrew George (Liberal Democrat, St Ives)

I beg to move amendment No. 79, in page 88, line 16, leave out subsection (4), and insert— '(4) For the purposes of sub-paragraph (3)(b)— (a) "illness" may have such meaning as may be prescribed; and (b) "disability" shall have the same meaning as in Section 1(1) of the Disability Discrimination Act 1995; and (c) the question whether an illness or disability is long-term shall be determined in accordance with regulations made by the Secretary of State.'. The purpose of the amendment is entirely serious: to clarify the definition of "disability". Under applications for a variation of provisions in schedule 2, the Secretary of State is oddly left to define "disability". Although it is conceivable that the Secretary of State may need discretion over defining "illness" and "long-term", we have in the Disability Discrimination Act 1995, under which a commission is to be set up, a firm definition of "disability". Section 1 states: a person has a disability for the purposes of this Act if he has a physical or mental impairment which has a substantial and long-term adverse effect on his ability to carry out normal day-to-day activities". There are two main arguments for the amendment, on which I can be brief because they are self-explanatory. The first is an administrative argument. The Disability Discrimination Act must be used. If the Government do not get into the habit of using it where they should do so, its worth will be devalued and it will not automatically be referred to as a benchmark. The second reason is ideological, and I would have thought the Labour Government would approve of it. The Government have committed themselves to civil rights and equality of opportunity, for which I applaud them. In this instance, however, they are leaving aside an important piece of civil rights legislation. That undermines the Disability Discrimination Act 1995 and the Government's wider aims of social inclusion. I therefore ask the Minister at least to acknowledge the fact that there is legislation that provides a more helpful definition of "disability". The Secretary of State could be left with some discretion over the terms "long-term" and "illness".

Angela Eagle (Labour, Wallasey)

I hope to persuade the hon. Member for St. Ives (Mr. George) of the fact that the Bill applies a reasonable definition of "disability", and to explain to him why we do not think that it is appropriate that the definition suggested in the amendment should apply in such circumstances. Amendment No. 79 relates to the provision under which the Secretary of State may agree to vary the normal child support maintenance calculations on the ground that a non-resident parent is incurring costs attributable to the long-term illness or disability of a child who lives with him as a member of the second family. That is the sole reason why we need a definition in this context. The provision, and the associated definitions of "disability" and "long-term", are features of the departures scheme, which was introduced by the Opposition when in government in December 1996. As the hon. Gentleman has explained, the amendment would re-define "disability" by reference to section 1 of the Disability Discrimination Act 1995. In considering a variation on such a ground, the Secretary of State will be concerned with the costs associated with any disability. Given that there is already a benefit that is dedicated to helping disabled people with the extra costs that they may have to meet—disability living allowance—we propose to provide in regulations that a child will be considered "disabled" if either the care component, the mobility component or both components of DLA are in payment to any person on his behalf, or if he is registered blind. The same qualifying conditions apply to awards of the disabled child premium in income support. That creates consistency across the range of benefits, which is important for administrative purposes. Having established that such conditions are met, the Secretary of State will need only to consider the evidence that the non-resident parent provides on the additional costs associated with the disabling condition. Our view is that the definition of "disability" that we intend to prescribe is a reasonable one, and that it will be a much more straightforward and objective test for the Child Support Agency to apply than the one proposed in the amendment. The latter would require the agency to make judgments of a medical nature—a task for which it is not qualified—aimed at employers, defining "disability" in employment. It is complex, running to 15 pages of guidance, and appealable to courts and industrial tribunals. In this context, we do not think that that is the best definition of "disability". I hope that the hon. Gentleman recognises that we have a good, quick, simple and consistent definition of "disability" in the social security system and that our suggestion will be much simpler, quicker and easier to apply. It will not disadvantage anyone; the appropriate people will still be described as "disabled". I hope that, on that basis, he will withdraw the amendment.

Andrew George (Liberal Democrat, St Ives)

I am grateful to the Minister for that clarification. I am pleased that I probed the matter because it was unclear. Her reassurances have been helpful. I am sure that the organisations for the disabled that expressed concern about the phraseology will be, as I am, reassured by her response. On that basis, I beg to ask leave to withdraw the amendment.

The rest of the debate is in Hansard.