Child Maintenance and Other Payments Bill
Public Bill Committee, 17 July 2007.
Christopher Chope (Conservative, Christchurch)
Before we begin, I have a few preliminary announcements. Hon. Members may take off their jackets during Committee meetings, if they wish to do so. Hon. Members should please ensure that all electronic devices are switched off throughout our proceedings. There is a money resolution and a Ways and Means resolution in connection with the Bill, and both are available in the Room.
First, the Committee will consider the programme motion on the amendment paper, for which debate is limited to half an hour. We will then proceed to a motion to report written evidence, and then to a motion to permit the Committee to deliberate in private in advance of the oral evidence sessions. Assuming that the second motion is agreed, the Committee will move into private session. Once the Committee has deliberated, the witnesses and members of the public will be invited back into the room and our oral evidence session will commence.
I am afraid that members of the public who are present will be disrupted at the beginning, but I hope that it will not be too long before they can come back in and hear the oral evidence session. We will hear oral evidence this morning and this afternoon. On Thursday we will proceed to clause by clause scrutiny of the Bill.
Christopher Chope (Conservative, Christchurch)
We will now hear oral evidence from representatives of the Department for Work and Pensions. I welcome the witnesses and ask them to introduce themselves, starting with the Ministers.
Christopher Chope (Conservative, Christchurch)
I remind hon. Members and witnesses that we are bound by the internal knives agreed in the programme motion. The first evidence session must therefore end at 1 o’clock at the latest. The second must end at 5.30 pm at the latest and the third no later than 7 pm. I hope that I do not have to interrupt hon. Members or witnesses in the middle of their sentences, but if that is required by the decision of the Committee on the programme motion, that is what I shall do. Before the first question, I remind hon. Members that questions should be limited to the provisions of the Bill.
Andrew Selous (Conservative, South West Bedfordshire)
I start by asking the Ministers why we do not have draft regulations, unlike the Welfare Reform Bill? We have a Prime Minister committed to a new environment of open parliamentary scrutiny, but we are considering the broad architecture with very few details laid out.
Given the previous difficulties that the CSA has had—hon. Members on both sides of the House are extremely worried about this—why was the Bill not brought forward at the same time as the regulations so that we could have scrutiny leading to possible amendment? That will not be possible when the draft regulations come in. When the regulations come in by statutory instrument, they can be only accepted or rejected.
James Plaskitt (Labour, Warwick and Leamington)
May I try to help in answering that? It is sensible to approach the regulations in different categories. First, much of the Bill is framework architecture for work that the Child Maintenance and Enforcement Commission will do subsequently. It is important to stress that we are moving from an agency model to a commission model. It is right, in many respects, to allow the commission to devise its own systems. Therefore, it is right and proper that the commission be established first and then for it to think how it wants to proceed in respect of various areas—some of those things will eventually emerge via regulation. Logically, the regulations will not come forward until the commission has done that work. Examples of operational regulations that need to await Royal Assent and the establishment of the commission are those that relate to fees, maintenance assessments, and the transfer of cases.
However, I may help the Committee by pointing out that other regulations will relate more to the setting up of the new system, and they will come forward sooner. For example, regulations relating to CMEC as a legal entity, the extension of the £10 disregard to old cases, the repeal of section 6 of the 1991 Act—that is the compulsory engagement of benefit recipients into the system—and the new enforcement powers will come forward earlier. We suspect that that will take place in the spring of 2008.
There is a third category where we hope to bring forward draft regulations during the procedure of line-by-line scrutiny in Committee. For example, those draft regulations that can be proceeded with in a timely fashion relate to clauses 29 to 31, which cover debt management, clause 34, which covers the recovery of arrears from estates, and clause 35, which deals with the disclosure of information to credit reference agencies. I expect draft regulations on those clauses to come before the Committee. In respect of those for which we cannot put draft regulations before the Committee, we will produce a dossier for it to consider, which will provide an explanation about regulations that are still forthcoming.
Andrew Selous (Conservative, South West Bedfordshire)
I have a brief supplementary question. Why is CMEC being set up as a non-departmental public body rather than an executive Government agency? Surely the past 10 years tell us that parliamentary scrutiny will become much more important. Many people have put it to me that only an MP’s letter has made the CSA jump to try to sort out often intractable cases. As a non-departmental public body, it will be much more at arm’s length, and a number of hon. Members on both sides of the House are concerned about our ability to scrutinise, to hold Ministers to account and to get answers from CMEC.
Andrew Selous (Conservative, South West Bedfordshire)
What stops an executive agency from having operational flexibility?
Michael Weir (Scottish National Party, Angus)
When the Minister was talking about regulations, he did not mention minutes of agreement. They have been welcomed throughout the House, but there is a painful lack of detail about how they will work. Will he introduce regulations covering such matters as whether the agreements have to be in writing, whether there will be a register and whether there will be any quality control of the nature of voluntary agreements?
Michael Weir (Scottish National Party, Angus)
But is it not important that the regulations concerning how people go about making a consent order, or minute of agreement, are in place at an early stage? I am bit concerned that there does not seem to be any proposal to bring forward such regulations until a fairly late stage, when the commission is up and running.
Tim Boswell (Conservative, Daventry)
I have two questions, although the first is perhaps more of an observation. It is interesting that another Department has recently introduced lasting powers of attorney, which are registerable before operation. Given that there is bound to be an interaction with the total income levels of participants in the process, it might be relevant to consider that.
My question relates to the assurances about accountability that the Minister has given us. I understand his arguments, particularly for operational flexibility and even for a degree of discretion. Against that, one has to weigh the need to ensure that what is prescribed in the law is carried out, that practice is consistent between different cases and that discretion is effected in a reasonably principled way. Will the Minister assure us, first, that if we have individual casework, in practical terms we will be able to pursue the matter in almost exactly the same way and, secondly, that if we have what might be termed systemic concerns about the way in which CMEC is to operate, we can at least raise them rather than waiting for the off-chance of an annual report debate in Westminster Hall or elsewhere?
Sarah McCarthy-Fry (Labour, Portsmouth North)
We heard Lord McKenzie use the phrase “clean break”, which has been used many times and especially on Second Reading, and we heard a great deal from witnesses about structural change. Miss Reynolds, will parents notice a clean break, or will they think of it as the CSA by another name?
Sarah McCarthy-Fry (Labour, Portsmouth North)
Could all that have happened within the CSA, or do you feel that it needs a completely new structure?
Desmond Turner (Labour, Brighton, Kemptown)
CMEC is going to be responsible for information and guidance, collection and enforcement and, although this is not spelt out, for the assessment of maintenance too. That does not sound so very different from the CSA in its present form. A potential issue arises here. As Mr. Selous pointed out, this is a non-governmental body rather than an Executive agency. At least there is a degree of clarity at the moment. When the CSA makes a mistake, or is held to make a mistake, which has filled several filing cabinets in my office over the years, we have recourse to the appeals tribunal and the social security commissioner and it is fairly clear. This would be the first example that I know of—there may be others—of a non-governmental body being open to the workings of the appeals tribunal and the social security commissioner. I seek total clarity from the point of view not only of claimants, but of Members of Parliament who may get called upon to help them out.
Desmond Turner (Labour, Brighton, Kemptown)
Okay, but can you also give clarity about advice and guidance that will be offered between the third and private sectors? How will that relate to CMEC?
Desmond Turner (Labour, Brighton, Kemptown)
Yes.
Desmond Turner (Labour, Brighton, Kemptown)
So, for instance, couples might turn to a body like the citizens advice bureau and expect some advice. What arrangements would you set in place to ensure the competence of that advice?
Tim Boswell (Conservative, Daventry)
On the reassurances that we were given, and the offer of a note on the appeals process, could we also have a comment on the potential—one hopes that it will not happen—for a judicial review on points of law, as it applies in this case, as the law will be changing.
On the issue of the service, I may not have focused on it as much as others might have done, but I take it from what has been said that there is no question of there being, for example, a local tendering whereby a non-governmental organisation might take over offering the service locally rather than simply having an impersonal helpline. I appreciate that it will help people, but would there be the possibility of face-to-face meetings where people could get local advice as well as distant advice, if they prefer that route.
Andrew Selous (Conservative, South West Bedfordshire)
Could I seek some clarity on what rough proportion of the advice service will be provided by CMEC, and what by voluntary and private organisations? I ask the same question in terms of the funding of that advice.
Michael Weir (Scottish National Party, Angus)
Just on the point that I made earlier, if we are doing a system over the telephone, with, as Lord Mackenzie mentioned, a standard minute of agreement available over the internet, will there be any quality control over the nature of agreements entered into? Worries have been raised by some that, for example, women could find themselves under pressure to agree a minute of agreement that may not be in their best interests.
Paul Rowen (Liberal Democrat, Rochdale)
I am interested in what you say about how this is going to be a clean break. One of the current issues with the Child Support Agency is the fact that when people use the phone, they are dealing with umpteen different people. They never actually get a case officer who is dealing with their particular case. What steps are you going to take to ensure that there is some consistency and that people have somebody who is directly responsible for dealing with their particular case?
Nadine Dorries (Conservative, Mid Bedfordshire)
I want to go back to the point made earlier about pressure and the online agreement. If there are no individual case workers and no named personal key worker that a woman can talk to, what process is in place to eliminate the pressure and obligation that she may feel under to accept the agreement?
Nadine Dorries (Conservative, Mid Bedfordshire)
I understand the point that you are making about the outreach and support services, but experience shows that, in such circumstances, case workers tend to read out a tick list. It is almost a process of saying, “Have we informed you of this? Have we informed you of that?” If a particular case worker will not be involved with the same client the next day or the following week, there is not the same obligation to carry out the process, either in person or on the telephone, as effectively as if the caseworker were to deal with the same person on an ongoing basis.
Nadine Dorries (Conservative, Mid Bedfordshire)
Is priority given to the parent who has the child—the parent with care—and would the information that you are getting back from that particular group take precedence over information from the group who do not have care?
Albert Owen (Labour, Ynys Môn)
Lord McKenzie, you mentioned that you did not envisage the role of MPs changing significantly from that which they have for the current system. Do you envisage that there will be a MPs’ hotline—or a lukewarm line for some cases—and, if so, will the MPs have the same caseworker so that there is that continuity?
Albert Owen (Labour, Ynys Môn)
But you accept that the MP is often the first port of call for advice, rather than people going to the different agencies, which can be confusing. The direct contact and the hotline are therefore very important.
Albert Owen (Labour, Ynys Môn)
I must emphasise the lack of continuity. Sometimes the CSA cannot bring up the information for a long time on the MPs’ hotline. One of the problems is that we cannot get the information quickly.
Tim Boswell (Conservative, Daventry)
Turning back to the advice and guidance service—I assure you that I am not looking for trouble, but things will occasionally go wrong—who will carry the legal responsibility or will be suable in a case of misguided advice to a party who accesses the commission? Will it be the commission or its contractors? What steps will be available to establish some kind of audit trail as to what kind of advice had been tendered, because that is the subject of argument in social security cases for our constituents?
Andrew Selous (Conservative, South West Bedfordshire)
On a broader issue of financial scrutiny, I understand that there is the ability, with an Executive agency such as the CSA, to ask parliamentary questions to get data. Will that be the case with CMEC as a non-departmental public body?
Andrew Selous (Conservative, South West Bedfordshire)
Excellent.
Desmond Turner (Labour, Brighton, Kemptown)
The Bill makes provision for charging for services. Do you propose to do that for CMEC immediately or wait until it has established some sort of a reputation for effective and efficient service—in other words, when it has advanced itself beyond the public view of the CSA? Will there be charges directly or will it wait?
Desmond Turner (Labour, Brighton, Kemptown)
The system will begin without charges then.
Desmond Turner (Labour, Brighton, Kemptown)
What is your thinking on the level of charges? For instance, do you contemplate setting the charges at a fairly steep level to encourage people into private agreements and thus avoid charges?
Desmond Turner (Labour, Brighton, Kemptown)
Sir David Henshaw argued that if we were to levy charges we should charge not only the absent parent but the parent with care. Is that fair, or do you think it could be an undue burden on the parent with care?
Desmond Turner (Labour, Brighton, Kemptown)
It comes back to the intention and purpose of charging. If the fairly considerable cost of operating the CSA is a measure of the costs that will be involved in running CMEC, and if you were seeking to recover some of those administrative costs, the implication is that charges would be pretty high. What is the thinking behind it? Why charge at all?
Desmond Turner (Labour, Brighton, Kemptown)
It is a carrot and stick approach.
Michael Weir (Scottish National Party, Angus)
You mentioned earlier the contracting out of information guidance services, but the Bill also gives the power to contract out other services. What proportion of other services you envisage being contracted out?
Michael Weir (Scottish National Party, Angus)
Do you see the core services of maintenance calculation and collection as candidates for being contracted out?
Michael Weir (Scottish National Party, Angus)
CMEC has one fundamental difference from the CSA, which is that the calculation is based on information obtained from Revenue and Customs. I just wonder, in these circumstances, whether contracting out maintenance calculations should even be considered.
Andrew Selous (Conservative, South West Bedfordshire)
I want to ask about the scope of CMEC. This is perhaps an opportunity to set a slightly different direction in terms of the objectives of what we do. Mr. Geraghty talked about one or two things that happen in America, for example. If you look at the Australian Child Support Agency, one thing that it is much better at, and which frankly the CSA has never done here, is trying to deal with the human side of break-up and to ensure that the ongoing emotional support, as well as the financial support, for children carries on from both parents going forward.
I had a look at the Australian CSA’s website yesterday evening, and on the front page it says “Support for Separated Parents”. You can download these excellent documents. I do not know if you have seen them. One is “Me and my kids: parenting from a distance”; the other is “Me, my kids and my ex”. They are full of incredibly practical help, information and support to try to make life better for children. That is what we are talking about: the money plus a better situation in terms of parental involvement, where it is safe, from both parents going forward.
The CSA has never really done the human side of what we are talking about. My contention—my argument to you—is that if you get the human side right, by which I mean the emotional support, that could not be a better aid in helping us all achieve what we are seeking, which is a regular, reliable supply of financial information.
This is a new opportunity. The Bill is before us, and I am really asking you to look very carefully at what the Australian CSA did. It may be that you do not want to provide it as CMEC because of some of the past history, but in terms of the purchaser-provider split, are you going to ensure that some of this help and support is provided, which other CSAs around the world in societies pretty similar to our own are providing? I urge you most strongly to look at that as a way of helping us to achieve what we are all trying to achieve.
Andrew Selous (Conservative, South West Bedfordshire)
With respect, I went there with the Select Committee in the middle of the last Parliament. There was plenty on it then. I brought back this biro saying “Staying connected”. It was actually doing that then, but no doubt it has done more since.
Andrew Selous (Conservative, South West Bedfordshire)
There has been a lot of talk about changing the culture. That phrase comes out in the White Paper, and it was used on Second Reading. Do not any of you see this sort of initiative in Australia as a key part of changing the culture and going forward, and not just viewing the non-resident parent as the provider of cash? That would be a help towards the aim of ensuring a steady, reliable source of financial maintenance.
Andrew Selous (Conservative, South West Bedfordshire)
May I take it from Lord McKenzie’s answer that there is at least a commitment to signpost where this type of support and help can be found for separated parents? I am not asking you to make a budgetary commitment, but if it is not out there the implication is that we will have to do some capacity building so that it can be provided.
Andrew Selous (Conservative, South West Bedfordshire)
Excellent.
Tim Boswell (Conservative, Daventry)
I want to ask a couple of questions about the transfer of staff in a moment. First, may I just comment on some exchanges earlier with Mr. Weir about information and point to one of the underlying concerns? I assume CMEC will have the information, but I hope it will not abuse it by allowing it to leak out further. We know how sensitive the Revenue is on this and, indeed, how sensitive our constituents are.
My questions relate to the new structure of employees when the commission comes into force. Could you give us an idea of the percentage of current CSA staff who will be required by CMEC and the fate, if I may put it that way, of the transfer? There will be some who will come across, and I take it that they will be covered by Transfer of Undertakings (Protection of Employment) Regulations 1981 in relation to their entitlements. Some may be made redundant and, equally, there will be some new recruits who may have different and more appropriate skills for the mix. Could you comment on that general picture? Can I also ask you about training for the new commission? It seems that not enough was initially invested in the CSA. There are still difficulties with people understanding what are very complicated formulae. That all feeds into morale and the likely attitude of staff to the new organisation.
Nia Griffith (Labour, Llanelli)
I should like to ask two questions. First, if a significant reduction in numbers is required, how do you propose to handle that? Secondly, to what time scale are we working for both the transfer of staff and the training programmes?
Mark Harper (Conservative, Forest of Dean)
Sir David Henshaw envisaged that the new system would be significantly different, and that the Government service would deal with a smaller set of more difficult cases. The regulatory impact assessment’s analysis estimates that the number of parents with care would fall from the 1.4 million that use the CSA to about 1 million. One could view that as a significant reduction, but equally one could say that 1 million people were still using the state system. I am not sure that I would say that that was a significant change.
The other question—recognising what Stephen Geraghty just said—relates to the analysis that has been undertaken to get to those numbers. Of the current caseload of 1.5 million cases, 500,000 of those have nil liability. It could be argued that removing those cases with no liability would save some bureaucracy but not really change the amount of money that ends up with families and children. I am trying to understand what assessment you have made of the robustness of the figures, and the extent to which we are moving to a completely different system rather than moving to Child Support Agency version 3.
Mark Harper (Conservative, Forest of Dean)
Picking up Sir David’s point, given that work and the quality of the information, do the Government have a view on the number of separated parents whom they want to use private arrangements rather than a statutory scheme? Do they have any view on that, or will they just let the system settle down and see where it falls?
Mark Harper (Conservative, Forest of Dean)
Those choices will depend, to some extent, on the parameters that the Government and the commission set. They will depend on charging, on the effectiveness of the body and on the equality and scope of the information. Although you say that you want it to be a choice, those choices will be guided by policy decisions. Picking up the point made by Dr. Turner, I did not know whether a view would be taken about the fees, for example. The level of the fees, for the non-resident parent and the parent with care, will drive decisions to some extent and the Government will have to have a view about the decisions they want people to make when those fees are set.
Mark Harper (Conservative, Forest of Dean)
Finally, do the Government share the vision that Sir David Henshaw outlined of the statutory system being aimed primarily at a small number of more difficult cases and the rest of the maintenance arrangements going through private arrangements?
Andrew Selous (Conservative, South West Bedfordshire)
Professor Nick Wikeley’s memorandum drew the Committee’s attention to this year’s Department for Work and Pensions research report No. 444, which suggests that slightly fewer parents with care are likely to take advantage of the private arrangements. Has that research report altered the findings of the regulatory impact assessment on the number moving over?
Andrew Selous (Conservative, South West Bedfordshire)
Perhaps you could write a note to the Committee on that point.
Albert Owen (Labour, Ynys Môn)
Lord McKenzie, you mentioned the benefit disregard. At what level do you plan to set the significant increase in the disregard and on what assumption have you based that decision?
Albert Owen (Labour, Ynys Môn)
No figures, but your intent is to increase it.
Albert Owen (Labour, Ynys Môn)
The disincentive to a lone parent could be considerable if, for instance, there was a full disregard. Does that not negate the Department’s attempts, on the other hand, to encourage people back into work?
Albert Owen (Labour, Ynys Môn)
The clock is ticking.
Albert Owen (Labour, Ynys Môn)
On timetabling, existing benefit claimants are expected to reapply to the new system or to opt for private arrangements in 2008, yet any increase in benefit disregard will not occur until 2011. Why is that, and why not run them together? I presume that that is because you do not have the information.
Albert Owen (Labour, Ynys Môn)
One of the main aims of the Bill is to alleviate child poverty, and the regulatory impact assessment states that a significantly higher disregard would lift approximately an additional 100,000 children out of poverty. I am finding it difficult that you do not have the figures, but how did you come to that conclusion?
Siân James (Labour, Swansea East)
I want to turn to the maintenance calculations. Will you outline how you reached the new formula figures on maintenance calculations, which take into account the change from net income to gross income? Do they actually represent the cost of raising a child, and why are the new proportions set out in schedule 4 different from those proposed in the White Paper?
Siân James (Labour, Swansea East)
Were those simply adjustments that you needed to make at that point?
Siân James (Labour, Swansea East)
Why have you maintained an upper earning limit for maintenance calculations?
Andrew Selous (Conservative, South West Bedfordshire)
One of the main problems that the agency faces is the inaccuracy of the assessments, which leads to massive problems for your staff; they tear their hair out, as do parents with care and, no doubt, the non-resident parents, too. Obviously the move to use Her Majesty’s Revenue and Customs data is widely welcomed across the House. Frankly, we should have done that years ago, so it is excellent that it is coming in. Why can we not have that from day one, and why can we not move to using HMRC data as soon as possible? The introduction of that data is rather staggered and set back in the Bill, so why cannot it be fast-tracked and brought forward?
Andrew Selous (Conservative, South West Bedfordshire)
I do not follow that. The provision of income from Revenue and Customs could presumably be provided today. HMRC must have those data, although perhaps they are stored in several places. The calculations done by the agency are, I accept, a separate matter. However, making arrangements to gain immediate access to accurate information, rather than having to wait for it from a recalcitrant non-resident parent, would surely be better started now?
Andrew Selous (Conservative, South West Bedfordshire)
Is the Department generally seized of the need to move as fast as it can, especially with the directions that you are giving your computer software programmers and so on, to make the change happen as quickly as possible?
Andrew Selous (Conservative, South West Bedfordshire)
Are you getting the maximum possible co-operation from HMRC?
Andrew Selous (Conservative, South West Bedfordshire)
Good.
Desmond Turner (Labour, Brighton, Kemptown)
The whole assessment formula is based on gross weekly income, which is fine for many; but some people’s incomes vary an awful lot from week to week, especially manual workers on variable rates of overtime and so on. Indeed, many of my constituents in the acting profession go from feast to famine. Against that background, I wonder how you came to select the figure of 25 per cent. to cope with income variation and how you intend to apply it in practice.
Desmond Turner (Labour, Brighton, Kemptown)
Will you review annually everyone’s assessment, or will it be triggered by a request to take account of change of income, or what?
Michael Weir (Scottish National Party, Angus)
One of the problems that MPs often get at present is with self-employed people. There seems to be a huge difference between what their alleged income is, as given to the CSA, and the lifestyle that the parent with care will say they are enjoying. Do you believe that the provisions in the Bill sufficiently address these issues, particularly with reference to self-employed people?
Michael Weir (Scottish National Party, Angus)
But then again, self-employed people are very good at reducing their income through accountants and such like for tax purposes. If there is a variation with child support, will there be a knock-on effect, with HMRC looking again at self-employed people’s tax returns?
Michael Weir (Scottish National Party, Angus)
From what you are saying, it does not seem that there will be a great departure from the present system, under which you can already go to the CSA and say, “I do not think this income is correct.” My experience, 99 times out of 100, is that the CSA does not look at it properly, it takes for ever or it tries to get information from the other parent, which never comes. It just goes on and on and on. Even getting HMRC data, I do not see a great difference in this. It still seems that there will be a problem with self-employed people.
Michael Weir (Scottish National Party, Angus)
I accept what you are saying, but it still does not get round the problem of assessing what someone’s actual income is at the first stage. I appreciate what Lord McKenzie says—it is very difficult to do so, and HMRC is possibly the best that we can get. But I still foresee the problem that we have at present continuing under the new system—the difference between lifestyle and declared income.
Michael Weir (Scottish National Party, Angus)
I appreciate that, but it seems that you are saying that the cases that are difficult now will continue to be difficult in the future.
Christopher Chope (Conservative, Christchurch)
We need to move on, because otherwise we will find ourselves running out of time.
Siân James (Labour, Swansea East)
Just quickly, on the transfer of cases to the new system, I am concerned because I know of a number of fathers who are still trapped in the original system and have never quite made it over to the interim system. They are now facing a third system. Are you convinced that you have sufficient resources vis-Ã -vis personnel and so on to make the successful step into the third system—the son-of-son-of the CSE?
Siân James (Labour, Swansea East)
My problem is that more and more people are choosing to go to the ombudsman about the CSA, and I envisage another group of people being unhappy, dissatisfied and left behind. I want to avoid that at all costs.
Siân James (Labour, Swansea East)
Given that people will be making their own private arrangements and the particular difficulties and challenges of that, which we have heard about, will there be sufficient personnel and resources to deal with the particular problems of those people?
Siân James (Labour, Swansea East)
Private arrangements.
Andrew Selous (Conservative, South West Bedfordshire)
On the enforceability of private voluntary agreements, the move to CMEC is, as I understand it, predicated on a reduction in the number of people coming to the organisation, because you hope that they will form their own voluntary agreements. There is general support for that, but is it not the case that people will form voluntary agreements only when they think that they are worth the paper they are written on in terms of being enforceable? Would you, as CMEC, not be helping yourselves if people were able to call on the enforcement powers of CMEC to ensure that an appropriate voluntary agreement was enforced? This seems to be a key issue. We touched on it earlier with the Scottish minutes of agreement issue, but it is much bigger than that and is definitely a UK-wide issue.
I get the sense from the Department—from what the Secretary of State said on Second Reading—that you do not want to have anything to do with enforcing private agreements. You see that as more work, and you are trying to shed work. I make the counter-claim that CMEC’s having some role in ensuring that appropriate voluntary agreements are enforced would help to achieve your objectives. What do you say to that?
Andrew Selous (Conservative, South West Bedfordshire)
If I were a vulnerable parent with care who wanted not to become embroiled with CMEC, but to do what you are encouraging me to do and hope I will do, would I not need some reassurance that the voluntary agreement that I entered into would be honoured?
Mark Harper (Conservative, Forest of Dean)
To pick up on the point about voluntary agreements, you have made it clear that you do not see a role for their enforcement, so what about monitoring and recording their existence, given that the Bill’s objective is to maximise maintenance arrangements for the whole marketplace? If you do not know how many separated families have maintenance arrangements in place, and you know only about those with which CMEC is dealing, do you really have any idea about whether the legislation’s objective is being reached?
Mark Harper (Conservative, Forest of Dean)
In that case, though, how do you have any way of knowing whether the commission is achieving its main objective? You will have some data collection, and it cannot just be the cases that use the statutory process, because to some extent, the most important cases are those that do not use it. Not that I am one to increase burdens, but unless you have some data-gathering and some way of knowing what is going on, you have no way of knowing whether it is successful.
Mark Harper (Conservative, Forest of Dean)
Rather than trying to track the agreements.
Michael Weir (Scottish National Party, Angus)
May I take it from what Lord McKenzie says that there will not be a prescriptive agreement? For example, in the Scottish system, you can enter a minute of agreement, record it in the books of counsel in session and have it enforced by sheriff officers. Will that continue after CMEC is set up?
Albert Owen (Labour, Ynys Môn)
Is it your intention to use the deduction from earnings orders on existing arrangements as well as new ones—even when the arrangements are working perfectly well?
Albert Owen (Labour, Ynys Môn)
How would you select pilot cases?
Albert Owen (Labour, Ynys Môn)
That answers that point very conclusively. The Bill includes a provision that the orders should not be used where there is good reason not to. Can you give some examples?
Albert Owen (Labour, Ynys Môn)
Does that not contradict what Lord McKenzie is saying—that we must be sensitive and have pilot schemes?
Albert Owen (Labour, Ynys Môn)
Different cultures in the country?
Nadine Dorries (Conservative, Mid Bedfordshire)
I want to return to something that you mentioned a moment ago, which probably links to the question that I want to ask. I want to talk about the record of accuracy in calculations. You touched on that, and on the voluntary agreements. However, something that you said about the voluntary agreements concerned me. You talked about the client surveys, and how you were asking people what suits them: whether it was the mortgage payments, or a payment directly to a child. However, there is no specific monitoring of that. It immediately occurred to me that a voluntary agreement might be entered into, part of which is that the mortgage payment is covered, but if it is not, and the parent defaults on those payments, that leaves the parent who is caring for the children in a very vulnerable position. Do you not think that if people are entering into those voluntary agreements, and allowing parents to take on voluntary responsibilities which would have such immense consequences, it is appropriate for such provision to be voluntary, and not obligatory?
Secondly, I have a number of cases where there have been inaccurate calculations of the amount that the father was due to pay or receive. That causes all MPs a huge amount of problems and work, as well as distress to parents. What will happen to ensure that we no longer have that huge margin of discrepancy? It has been a shambles. The record of accuracy in calculating payments is poor. I wish to highlight the accuracy in calculating payments, and the vulnerability of a parent with children who is in a voluntary arrangement with somebody else paying the mortgage.
Nadine Dorries (Conservative, Mid Bedfordshire)
I understand that, but personal circumstances change. A couple on one day may think that it is appropriate and suitable, for example, for the absent father to pay the mortgage on a house lived in by the mother and two children; that may be suitable on day one. However, six months later he may default on that and the relationship may have broken down further. The agreement may not be as harmonious any longer. Should there not be some kind of monitoring to ensure that the voluntary agreement is adhered to?
Nadine Dorries (Conservative, Mid Bedfordshire)
You said in your opening statement that too much could be made of accuracy, but that does not apply to a parent who is not receiving the correct payments.
Nadine Dorries (Conservative, Mid Bedfordshire)
I assure you that none of the cases that I deal with is accurate to a penny; I deal with cases that are thousands of pounds out, so there are serious margins as well as narrow ones.
I understand what you say about the three-year improvement plan, which is 12 months in, because I served on a Statutory Instrument Committee six months ago when the issue was discussed. I understand that improvements are being made, and am happy to agree with that. However, we are going into another new system. Most of the inaccuracies of the previous system came about in the initial set-up and rolling out, and we are just beginning to put the problems right, 12 months into a three-year improvement plan; what guarantees are there that we will not incur problems with the new system? It is great that there is 90 per cent. accuracy, but that is now, with a system that you know, which has been operational for years and has been assessed, and which has an improvement plan. We are now going straight into a new system. Are we in danger of falling through the same trapdoors as before?
James Plaskitt (Labour, Warwick and Leamington)
The first formula that the CSA launched with in the 1990s required more than 90 different bits of information to achieve an assessment. We are moving now to a system that requires three core pieces of information. That is the best guarantee that we have a chance now to achieve far higher accuracy.
Mark Harper (Conservative, Forest of Dean)
I have a quick point. In our questioning we have talked about the use of the quite rightly tougher enforcement powers. Given that those powers are available much earlier than the new assessment systems, will they be used looking very carefully at the assessments that have been made? Tougher enforcement is very good, but not if we are trying to toughly enforce an incorrect assessment. We need to link the accuracy of the assessment to the enforcement powers; otherwise, a number of cases will be made much of in which those powers, which are rightly available, are being used when the assessment is wrong. That will not get the new commission off to a good start.
Christopher Chope (Conservative, Christchurch)
Do you want to raise a quick question about passports?
Mark Harper (Conservative, Forest of Dean)
I do. Very quickly, on the enforcement powers, clause 25, on disqualification for holding or obtaining travel authorisation, allows the commission itself to make an order. Under clause 28, which talks about disqualification for holding or obtaining a driving licence, the commission has to seek a court order. Why the difference? Furthermore, given that “travel authorisation” means also identity cards—I do not wish to rehearse the arguments about those—and that the Government’s vision is that, at some point, ID cards will have a role beyond travel and allow access to other public services, is the ability to disqualify someone from holding an ID card limited to the travel nature of that card, or will it include access to other public services?
Mark Harper (Conservative, Forest of Dean)
What about if it is connected to their employment, and the withdrawal of their travel authorisation affects, either partly or severely, the ability of the non-resident parent to earn a living and, therefore, to provide for their family? Many people nowadays, as part of their employment, are required to travel internationally. If you do that and the consequence is that the person loses their job or has a significantly reduced level of income, you will affect the family. If those are the consequences, is it appropriate that the agency can do that, or should it seek a court order?
Mark Harper (Conservative, Forest of Dean)
And they would have a right of appeal?
Christopher Chope (Conservative, Christchurch)
Where?
Michael Weir (Scottish National Party, Angus)
The Bill includes provisions for the write-off of historic debt in some instances. In many cases that go back years, parents with care have been trying to get money from other parents without great success, and large sums have drawn up. There is provision for part-payment of arrears to be accepted in full settlement. Will the parent with care be involved in discussions about whether that would proceed?
Michael Weir (Scottish National Party, Angus)
So, only with consent?
Michael Weir (Scottish National Party, Angus)
Would any compensation be offered to the parent with care in those circumstances?
Michael Weir (Scottish National Party, Angus)
Do you have any idea of the amount that you are seeking to write off? Will you, for example, try to get rid of all historic debt when the new agency is set up by coming to arrangements in those circumstances?
Michael Weir (Scottish National Party, Angus)
Will you look at the old cases to determine how many of them are inflated? I appreciate the point about the interim assessments, but most of those arose because the absent parent refused to deliver the information, so they were used specifically as a sanction in the first instance. There is some concern that by effectively running around the agency for years, the absent parent will get a reward by the writing off of what was originally supposed to be a sanction. How will you look at that issue, as there may be some cases where people simply have not paid for many years?
Michael Weir (Scottish National Party, Angus)
Given what Lord McKenzie said, it seems to me that there is potential for slight conflict on this issue. We are going to write off debt only where the parent with care agrees to it, but you are effectively saying that some debt will have to be written off anyway.
Michael Weir (Scottish National Party, Angus)
Take anything they can get at some stage.
Andrew Selous (Conservative, South West Bedfordshire)
Would not parents in care who are worried about this issue be more reassured if clause 2 included the collection of debt as a primary objective of the commission? Why is it not there as one of CMEC’s objectives?
Andrew Selous (Conservative, South West Bedfordshire)
So your interpretation of clause 2 of the Bill is that it relates to the collection of historical debt?
Michael Weir (Scottish National Party, Angus)
There is also provision in the Bill for the transfer of arrears to private sector debt collection. Have you researched the likely impact on vulnerable low-income families of factoring historical debt to such agencies?
Andrew Selous (Conservative, South West Bedfordshire)
I should like to move on to computer use by CMEC. The Public Accounts Committee report published the day after Second Reading accused the Department of not maintaining the capability of an intelligent IT customer. Could I have the name of the senior responsible owner for the CMEC IT project? Will you give an assurance that whoever that is will be in post the whole way through the implementation of the IT that will be necessary to make CMEC successful?
Andrew Selous (Conservative, South West Bedfordshire)
Okay. I want to be brief, because we need time for part 4 of the Bill. Will you give me an assurance that, when CMEC is up and running, one person—for whom the Public Accounts Committee term is “senior responsible owner”—will be nominated and will be in post for the length of the project, and not moved to another Department every two years because they have done well? Such movement is the reason why we have had a catalogue of IT failures across the whole of government. We must start learning lessons from what has gone wrong in the past, and I would have thought that the Department would be keen to learn those lessons, so that this is successful. I would like some reassurance on that point.
Christopher Chope (Conservative, Christchurch)
That brings us on to part 4.
Sarah McCarthy-Fry (Labour, Portsmouth North)
Mesothelioma is a dreadful disease. Portsmouth, my constituency, is one of the hot spots for it. The target six-week period for getting money to people will be absolutely crucial. Looking back, we can see that in other Departments, there is no history of having to get money to people within six weeks. Where will you get the resources from, and how do you know that you will have sufficient resources to be able to deliver that tight time scale?
Sarah McCarthy-Fry (Labour, Portsmouth North)
You are already there?
Sarah McCarthy-Fry (Labour, Portsmouth North)
You will be there. Okay, I shall move on to the next question. There is an assumption that you will be able to recover the money from insurers and employees. What happens if you do not, and what effect will that have on your financial projections? Could it mean that you would have to reduce the awards that were made?
Sarah McCarthy-Fry (Labour, Portsmouth North)
So it depends on how the money comes through. What monitoring will you do over the next few years and do you have monitoring plans in place?
Sarah McCarthy-Fry (Labour, Portsmouth North)
The delegated powers memorandum states that there will be a significant change, and major changes and modification to the Amendment of Social Security (Recovery of Benefits) Act 1997 because it is a significantly different form of recovery. That is all a bit vague. Do you have any more detail?
Sarah McCarthy-Fry (Labour, Portsmouth North)
A note would be helpful, but I would just like to get my head around this. Surely, their liability is no different from what it was before.
Sarah McCarthy-Fry (Labour, Portsmouth North)
It is just that the state will be able to recover it back.
Sarah McCarthy-Fry (Labour, Portsmouth North)
I see. A note would be useful; we may need to read a bit more on that.
Paul Rowen (Liberal Democrat, Rochdale)
Moving on to the retrospective impact, will the compensation recovery process apply only to relevant civil compensation claims that settle after the date that the section in question comes into effect?
Paul Rowen (Liberal Democrat, Rochdale)
What happens to the payments that are made?
Paul Rowen (Liberal Democrat, Rochdale)
So, you have a clear system in operation and you know the number of clients that will be affected?
Paul Rowen (Liberal Democrat, Rochdale)
What about the circumstances in which the amounts will be paid? You say that the amounts will vary. Can you tell us what sort of amounts, and what the circumstances will be that will determine those amounts?
Paul Rowen (Liberal Democrat, Rochdale)
Will the system not take account of their individual circumstances? You mentioned dependents, but there may be other circumstances.
Paul Rowen (Liberal Democrat, Rochdale)
Could you give us some information? Again, I think that that is quite important.
The final question is whom the provision might apply to. The Bill talks about people in the UK. However, if someone was working on the docks in Gibraltar, or any British naval dockyard not in the United Kingdom, would that affect payment?
Paul Rowen (Liberal Democrat, Rochdale)
Would that include Gibraltarians?
Paul Rowen (Liberal Democrat, Rochdale)
It is a dependent territory. There could be somebody working for a British company there who contracts the disease.
Paul Rowen (Liberal Democrat, Rochdale)
Would they be eligible for payment?
Paul Rowen (Liberal Democrat, Rochdale)
What about retrospectively? If you go back in time, when we had many more colonies, you may have many more eligible people.
Andrew Selous (Conservative, South West Bedfordshire)
I have two very brief questions. I have some constituents who seem to be stuck for ever between their former employer and insurance company, and I cannot get either to move at any speed to take the issue forward. Has there been any thinking on such issues?
I want also to raise the issue of pleural plaques, on which there is an early-day motion signed by a number of Members. I recognise that this is not as serious a medical condition as mesothelioma, but it is distressing and causes anxiety. Could the Minister or anyone present tell us what view the Department takes on pleural plaques?
Andrew Selous (Conservative, South West Bedfordshire)
What about the length of time that cases can be stuck between employers and insurance companies? In some cases, constituents are compensated quite quickly. Perhaps they had a smarter lawyer or the employer was feeling a bit more generous that day, but in more serious cases, there seems to be no cut-off period.
Christopher Chope (Conservative, Christchurch)
May I thank the witnesses for helping the Committee with its deliberations? I also thank the Committee members for their assiduous work during the morning. The room will be locked from 1 o’clock onwards, so if people wish, they can leave their papers here.
Written evidence to be reported to the House
Christopher Chope (Conservative, Christchurch)
Good afternoon. Thank you for coming, Professor Wikeley, and thank you for your paper, which has been circulated to our members and others. It would be best if you introduced yourself briefly and explained your background involvement with previous reports leading up to this piece of legislation.
Christopher Chope (Conservative, Christchurch)
We cannot go on any later than 5.30 pm with your evidence so I hope that you will tailor the length of your answers accordingly.
Albert Owen (Labour, Ynys Môn)
I have read your paper, but will you give us a general reaction to the Bill? Which parts do you think will work and which will not?
Albert Owen (Labour, Ynys Môn)
To push you a bit further, do you think that we need a new Bill to see something out of it? You are saying that we are not in a perfect situation, but you are underwhelmed by the Bill. What were you looking for that is missing from the Bill?
Albert Owen (Labour, Ynys Môn)
Is this a step forward or back in your opinion?
Anne McGuire (Labour, Stirling)
What would be the difference in outcome if the Bill accepted your premise of the child’s right to support rather than the non-resident parent’s duty to pay maintenance?
Anne McGuire (Labour, Stirling)
It would be more a cultural issue in terms of rights and responsibilities of parents and children than a change in the outcome. Is that what you are saying?
Andrew Selous (Conservative, South West Bedfordshire)
Could I press you on the matter of what you call private ordering or private arrangements? You said that that was the area you were most sceptical on.
Andrew Selous (Conservative, South West Bedfordshire)
What do private arrangements need to make them work and make them more popular?
Andrew Selous (Conservative, South West Bedfordshire)
I have one more brief question. The Government line, we heard this morning, is that the big stick to make private arrangements work is the Child Maintenance and Enforcement Commission system. From your experience of looking at child support around the world, is that sufficient? Does it need more teeth, or is the threat of being dragged into the tender embrace of CMEC going to be enough to make non-resident parents in particular keep the money flowing on a regular basis?
Nadine Dorries (Conservative, Mid Bedfordshire)
You said that parents tend to take what they are offered. We had a conversation this morning about parents being allocated a key worker or case worker who would see their case through. The case worker would probably deliver a better service, because they know that they will deal with that parent on an ongoing basis, and the parents would be offered some additional comfort. However, we were told that that is not possible. I would imagine that one reason why parents take what they are offered is that they feel vulnerable and think, “Let’s take this now while it is on the table, because it may go off the table and there may be nothing else.” Would you support the case for parents having one person within the department who deals with their case? It would give them the additional confidence that they might need if they knew, that if they did not take what they were offered, someone would be there, continuously dealing with the case and helping them to get a better deal.
Nadine Dorries (Conservative, Mid Bedfordshire)
That just exacerbates the complaints and the ongoing situation. There would be a much better outcome for everybody, including the employees, who would get to know clients over the telephone, and the clients, who would know who was looking after their case. Then, perhaps, there would be swifter resolutions and better deals and it would work better all round.
Natascha Engel (Labour, North East Derbyshire)
I want to talk to you about the David Henshaw review, in which he talks about avoiding cross- contamination and so on. Do you think that the Bill provides the clean break proposed by David Henshaw in his review?
Michael Weir (Scottish National Party, Angus)
We have already touched on this issue, to some extent. In your paper you say that you are not optimistic about the operation of the information guidance service. From what you were saying earlier, you almost seem to be arguing that we need to go back to the old position, where each party had separate legal advice before coming to an agreement. Is that your view?
Michael Weir (Scottish National Party, Angus)
Given that it was suggested on Second Reading that things would be web-based and telephone-based and this morning we heard some evidence that there would be, to some extent, a face-to-face service, how should the service operate to get the best out of the system?
Michael Weir (Scottish National Party, Angus)
In that scenario you are effectively going to have double the number of people involved. Each party will need separate advice on the terms of any agreement that they are entering into. The parent with care can obviously go to CMEC. Do you envisage a situation where the other parent will also get advice from CMEC? Is there a conflict of interest immediately there?
Michael Weir (Scottish National Party, Angus)
Yes. The absolute opposite.
Michael Weir (Scottish National Party, Angus)
Even if it is contracted out, it is contracted by CMEC to a third party. Therefore, it would still be done under the auspices of CMEC, albeit not directly. Are you concerned that in a lot of cases CMEC might be seen as acting not only as an adviser to one party, or perhaps both parties, but as the enforcer in the event that the agreement breaks down or one cannot be reached?
Michael Weir (Scottish National Party, Angus)
Picking up on what Mrs. Dorries was asking earlier, do you think that there will be pressure on parents with care to make private arrangements that may not be in their best interests as a result of this?
Michael Weir (Scottish National Party, Angus)
We had a discussion this morning on the possibility of having a register of agreements and some sort of monitoring of private agreements that are entered into. Do you think that that is necessary to see whether this is working in the interests of parents with care?
Michael Weir (Scottish National Party, Angus)
That comes back to the point. There is nothing in the Bill that says specifically, although it may come in regulations, that agreements even have to be in writing. If we just allow people to go out and make agreements, if there is no monitoring and quality control, how do we know whether they are working in the best interests of parents with care and children? Is there a need for some sort of monitoring or quality control?
Michael Weir (Scottish National Party, Angus)
I have one final question. It has been suggested—was it on the web?—that there will be a standard template agreement. Are people going to adopt that template and fill in the appropriate percentages? Is that likely to be the outcome?
Andrew Selous (Conservative, South West Bedfordshire)
You spoke earlier about the importance of changing the culture in a positive and responsible way in order to make a success of child maintenance. From your knowledge of the Australian system, do you think it would be useful for us to adopt any of its practical guidance and support in order to help non-resident parents to be good parents from a distance, and do you see that as part of the change needed to lead to the willing provision of reliable financial maintenance?
Andrew Selous (Conservative, South West Bedfordshire)
You say that the Australian system is unpopular. I have just been looking at the comments of separated parents on the back of the guides to long-distance parenting published by the Australian support agency. I do not know whether it is a highly selective sample of quotes, but separated parents, both mothers and fathers, are hugely appreciative of the practical nuts-and-bolts, week-by-week guidance on how to make their relationship with their children work. People never like parting with their money for all sorts of reasons, but I am keen to see such advice and guidance being given here, and we need to establish that now. What is your take on that?
Siân James (Labour, Swansea East)
Do you think it right that CMEC should have the ability to charge fees for its services and, if so, where and when should charging be applied? For example, should charges be used only in cases of non-compliance?
Siân James (Labour, Swansea East)
Sir David Henshaw said that you should apply it to both sets of parents, which would be more equitable. Do you think that any charging system should be delayed until CMEC has bedded in, proven its worth and been effective?
Siân James (Labour, Swansea East)
So confidence, first, and then fees.
Michael Weir (Scottish National Party, Angus)
What do you think will be the effect of the removal of compulsion for those on benefits to apply to the CSA by the repeal of section 6 of the 1991 Act?
Michael Weir (Scottish National Party, Angus)
Do you think that there is a real danger of more parents with care not having any child maintenance in place as a result of that change?
Michael Weir (Scottish National Party, Angus)
Does this not take us back to our earlier discussion about monitoring the effects? Do you feel that a system has to be in place to monitor the effects of the changes on the receipt of child maintenance by parents with care?
Michael Weir (Scottish National Party, Angus)
It seems to me that although the movement to private agreements has been widely welcomed, there is a danger of people falling through the net. I am trying to get at whether safeguards should be in place to monitor whether some people fall through the net where there has been a separation and maintenance is being paid. Do you have any idea how such safeguards could be put in place? Or should we not be repealing section 6 at all?
Michael Weir (Scottish National Party, Angus)
You are sceptical about the estimates of the fall in the number of people from those using CSA to those using CMEC. You seem to suggest that the estimates are slightly inflated and that CMEC will be dealing with more people than it imagines. Can you tell us more about that?
Michael Weir (Scottish National Party, Angus)
Given that one of the CSA’s problems from the outset was that it seemed to be under-resourced, do you feel that CMEC will have sufficient resources to cope with the additional demand, if it turns out that you are correct in your estimate and that the official estimates are somewhat inaccurate?
Natascha Engel (Labour, North East Derbyshire)
I have a slight issue with your central thesis. As I understand the Bill, part of it is about moving things into voluntary arrangements, which, by your own admission, are far more successful and far more likely to be adhered to. It is also about stopping things from just falling by default into the remit of the CSA or in this case CMEC. That shift is what David Henshaw’s report was fundamentally about, and the voluntary arrangements were one of the radical departures mentioned in it. I would like to find out whether you think that the proposals are fundamentally a move forward or backward, because I feel that there is a slight contradiction in your evidence.
Natascha Engel (Labour, North East Derbyshire)
They will do that by taking away the default. There will no longer be a default that people will fall into. That is exactly where things like the removal of section 6 might assist.
Natascha Engel (Labour, North East Derbyshire)
When you refer to private arrangements, do you mean situations in which both parents are working and neither is on benefit?
Albert Owen (Labour, Ynys Môn)
May I move on to benefit disregard? In your opinion, should the Government introduce a full benefit disregard, and if not, what level should it be set at?
Albert Owen (Labour, Ynys Môn)
It is clear from what you have said that you favour the full disregard, although you do not accept it as a disincentive to work. Do you accept that the Government are trying to help alleviate child poverty, and that 100,000 would be taken away from that?
Albert Owen (Labour, Ynys Môn)
You said that it was a difficult policy area. Is that not a clear aim and objective?
Albert Owen (Labour, Ynys Môn)
Does that point concern the time scale for introduction?
Andrew Selous (Conservative, South West Bedfordshire)
Moving on from the discussion about the disregard, I see that in paragraph 18 of your useful paper, you criticise clause 40, which takes away the ability to recover public expenditure on benefits in other areas. You have made the point that that measure would overturn some 400 years of British social security custom. Can you elaborate a little on that, and perhaps give a general perspective on the fact that the taxpayer as such will no longer be compensated for the costs of feckless behaviour by others? Should we shed just a small tear in the passing of that?
I have a second, slightly separate point about the disregard from the point of view of equity. I was wondering about the position of widows in relation to separated mothers and the disregard, in cases where there is a £10 disregard. Do you hold the view that they should move together, from the point of view of fairness?
Andrew Selous (Conservative, South West Bedfordshire)
I was being specific. There is a £10 disregard on the widowed parent’s allowance that matches the £10 disregard for separated parents in the new system. Were the Government to move from an equity perspective, I wondered if your view would be that they should move equally in both classes?
Siân James (Labour, Swansea East)
As an add-on, could you envisage a time when a woman might agree under duress to an arrangement? I am thinking of people who have been in abusive relationships, who do not want the hassle any more, and who would agree to anything that their partner proposed.
Desmond Turner (Labour, Brighton, Kemptown)
Are you happy with the new formula that changes the basis of calculation from net to gross income?
Desmond Turner (Labour, Brighton, Kemptown)
You can see lots of problems and yet more opportunities for the self-employed to get around the system.
Desmond Turner (Labour, Brighton, Kemptown)
Do you see any justification for the upper limit on earnings assessment?
Desmond Turner (Labour, Brighton, Kemptown)
But why have the cap at all?
Desmond Turner (Labour, Brighton, Kemptown)
What is your feeling about the increase in the flat-rate payment from £5 to £7, which does not, on the face of it, seem to be that significant? Do you really think it will make an impact on child poverty?
Desmond Turner (Labour, Brighton, Kemptown)
I shall change it if you want.
Desmond Turner (Labour, Brighton, Kemptown)
It could be argued that £5 was a pretty low starting point.
Desmond Turner (Labour, Brighton, Kemptown)
I am glad I do not have to live on it—or to support a child on it.
Andrew Selous (Conservative, South West Bedfordshire)
The 25 per cent. income variation has aroused a certain amount of comment. Do you think that there is perhaps a case for reducing it in terms of lower-income non-resident parents? If you are poor and you have a 24 per cent. fall in your income, this is a pretty significant rule. If you are on a hefty income, it does not make so much difference, but it is a blunt instrument for people who are counting the pennies week by week and trying to do the right thing. Would it be possible to have some sort of scale, perhaps even varying things a bit more at a higher level, so that overall this is not a cost to the Exchequer and just helps people lower down the income scale?
Andrew Selous (Conservative, South West Bedfordshire)
So overall you are comfortable with administrative ease, if we may call it that, taking precedence over some pretty rough justice at the lower ends of the income scale. Can clever computer programs not work this sort of thing out without tying up the agency in knots? None of us wants to see CMEC staff back on that hamster wheel. I want to probe you a little more on your experience from around the world. Can we do this in a slightly less blunt fashion for people who will be significantly affected?
Michael Weir (Scottish National Party, Angus)
We touched again on the self-employed. One of the things that we often hear in our constituency cases is the allegation that someone’s lifestyle does not match with their declared income. Now we are going on to HMRC figures, do you think that will be sufficient to allow this to be addressed, or is it just entrenching it in the system?
Michael Weir (Scottish National Party, Angus)
But we are asked to accept HMRC as being the arbiter of what an income is. Is it possible to design a system that will get round a perceived problem that the self-employed are able to have an apparently lower income than their lifestyle would suggest?
Michael Weir (Scottish National Party, Angus)
So, the same problem will continue under the new system.
Michael Weir (Scottish National Party, Angus)
Let us move on to another matter. Obviously, there are proposals to transfer cases to the new rules, but one of the gripes that we often hear from constituents is the fact that there are already two systems running in parallel within the CSA, providing totally different outcomes depending on when the case first went to it. We will now have a third system, and it may be some time before things are transferred over. Are you confident that there can be a successful transfer of cases from the CSA to the new maintenance calculation of CMEC?
Michael Weir (Scottish National Party, Angus)
Is there a danger that we will be running three different systems, with even more unhappiness among those who are subject to CMEC or child maintenance? Is there a way around that?
Michael Weir (Scottish National Party, Angus)
There will then be potential for disputes between the parties. Many non-resident parents who are subject to the old rules might wish to come under the new CMEC rules, but that might not necessarily be in the interests of the parent with care. How will CMEC balance the views of both parties and arrange for a transfer? Should not there be one rule for transfers? Otherwise, we will end up in the position that we are in now, with two systems running in tandem.
Siân James (Labour, Swansea East)
Do you think that CMEC needs greater enforcement powers than the CSA?
Siân James (Labour, Swansea East)
One of the problems that I pick up on regularly in my surgeries is that enforcement is pretty draconian for those who are within the ambit of the CSA and therefore already in the net, but it does not seem to affect at all those who have not yet been tracked down and who remain outside the system. People are sceptical about what enforcement means.
Andrew Selous (Conservative, South West Bedfordshire)
I understand that, at the moment, only 19,000 of the 247,000 non-compliant cases are with the enforcement directorate. I am broadly in favour of the new enforcement powers, because I have had too many parents in my surgery with woeful tales of not getting the maintenance, and I recognise the need to do something about that. It is crucial to ensure that the enforcement directorate is able to up the proportion of cases being investigated. What is your feeling on how CMEC would cope with that as it goes forward?
Andrew Selous (Conservative, South West Bedfordshire)
What is your view on deduction from earning orders as the first way of proceeding. Are you in favour of that? We understand that it happens in other jurisdictions.
Andrew Selous (Conservative, South West Bedfordshire)
Are you confident about CMEC’s ability to use administrative liability orders fairly, given the problems that we have had with assessment in the past?
Andrew Selous (Conservative, South West Bedfordshire)
How would you improve the appeals system, so that it is fair but does not take for ever to produce a result?
Andrew Selous (Conservative, South West Bedfordshire)
I shall move on to the issue of disqualification from holding or obtaining travel authorisation. There were some comments on Second Reading about the different attitude towards removing a driving licence, which could stop someone from being able to earn their living, as opposed to removing their passport. What would happen with an ID card? As far as I understand it, the experience from Australia and America seems to suggest that these sanctions work. What comments do you have on that?
Andrew Selous (Conservative, South West Bedfordshire)
I think that you may have suggested a possible amendment. That is useful.