The Social Security Committee has agreed to the following Report:—

INTRODUCTION

1. This Report examines the proposals in the Government's White Paper on Child Support A new contract for welfare: Children's Rights and Parents' Responsibilities[3] in the expectation that a Bill will be brought forward in the 1999-2000 parliamentary session to implement the White Paper proposals. The Social Security Select Committee has produced several Reports on Child Support since 1991[4] which have been generally supportive of the central idea of providing an administrative method of assessing, collecting and delivering child support, especially to lone parents living on Income Support. The principal legislation was the Child Support Act 1991, which was modified by the Child Support Act 1995. In the words of the Prime Minister "the Child Support Agency (CSA) was based on sound principles. But its operation has failed to live up to them."[5]

2. We have not sought to re-run the extensive consultation exercise which the Government carried out between producing the Green Paper Children First: a new approach to child support[6] in July 1998 and the White Paper in July 1999. We held an intensive series of public hearings in September 1999 to take evidence from a number of selected individuals and organisations, representing various points of view and expertise.[7] We are grateful to Baroness Hollis of Heigham, the Parliamentary Under Secretary of State (Lords) at the Department of Social Security, who appeared at both the beginning and end of our series of oral evidence sessions. Baroness Hollis has been the Minister responsible for the Child Support Agency (CSA) since May 1997.

CONTEXT

The failure of the existing child support scheme

  3. It is necessary to face the facts about the failure of the Child Support Act 1991 in order to reach a correct diagnosis of what is wrong with the existing child support scheme. Only then can we examine whether the Government's proposals will prove to be an effective remedy for the problems of the existing scheme. Many of the aims behind the original child support scheme are reflected in the proposals for reform put forward by the present Government. It remains to be seen whether the lessons will be learned from the failure of the scheme to date. The National Association for Child Support Action (NACSA) was sceptical: "As the DSS spectacularly failed to deliver the present child support regime, expecting the new proposals to work seems a triumph of hope over experience."[8]

4. One of the key aims behind the original introduction of child support was to reverse the declining number of lone parents on benefit who were in receipt of child maintenance. In 1979, 50 per cent of lone parents on Supplementary Benefit (the forerunner of Income Support) received child maintenance. By 1989 the proportion of lone parents on Income Support in receipt of child maintenance had fallen to 23 per cent.[9] Nine years later, and five years after the Child Support Agency began its work, the proportion of lone parents on Income Support receiving maintenance for their children had not increased.[10] The intention of the child support scheme was "to ensure that parents honour their legal and moral responsibility to maintain their own children whenever they can afford to do so."[11] By May 1999, almost a third of non-resident parents[12] assessed to pay child support were paying nothing, and a quarter were making only partial payments.[13]

5. Another of the major aims of the original child support reforms was to "produce maintenance payments which are realistically related to the costs of caring for a child."[14] The 1990 White Paper drew attention to "the comparatively low level" of child maintenance being awarded by the courts at that time, when average weekly awards were £15 per week in magistrates' courts; £20 per week in county courts; and £24 per week in Scottish courts.[15] In May 1999, the average value of a full child support assessment across all income groups was £19.99 per week.[16]

6. The original child support scheme also proposed to "allow for maintenance payments to be reviewed regularly so that changes in circumstances can be taken into account automatically."[17] Automatic periodical reviews were originally planned to take place every twelve months. This timetable proved impossible for the Child Support Agency, and in April 1995 the period for carrying out a periodical review was increased to two years. In December 1998, when the statutory duty to carry out two-yearly reviews was removed,[18] there were 371,000 periodical reviews waiting to be carried out.[19] By July 1999, there were still 350,000 outstanding periodical reviews.[20] The Government intends to bring forward legislation "as soon as Parliamentary time allows" to repeal retrospectively the statutory requirement to complete reviews for past periods.[21]

7. The 1990 White Paper which led to the introduction of child support, Children Come First,[22] was critical about the length of time it took the courts to arrange maintenance. At that time, half of magistrates court cases were cleared within 7 weeks and the median time for county courts was 19 weeks.[23] In the latest full year of the Child Support Agency's operations over a third of all new maintenance applications took longer than 22 weeks to be assessed.[24] At 31 March 1999, 47,720 maintenance applications had been outstanding for over 52 weeks, representing 32 per cent of the total number of outstanding applications at that date.[25]

8. The new child support scheme was supposed to "produce consistent and predictable results so that people in similar financial circumstances [would] pay similar amounts of maintenance, and so that people will know in advance what their maintenance obligations are going to be."[26] This aim has clearly failed to be achieved. The White Paper notes that "Because the existing child support formula tries to recognise a wide range of financial and personal circumstances it can produce widely varying levels of liability for non-resident parents at similar levels of income. For example, some non-resident parents earning between £300 and £350 a week are currently assessed to pay nothing while others are required to pay £100 per week or more."[27] Similarly, it notes that "Because the formula is so complicated, non-resident parents find it difficult to predict how much they will have to pay."[28]

Child poverty

  9. "Over half of all children living in poverty in Britain today live in single-parent families. If every absent parent paid the maintenance they owe, more than a million children would face a brighter future."[29] Child Support reform is seen by the Government as a "great step forward" towards the target of eliminating child poverty within 20 years.[30]

10. Three in five lone parents (63 per cent) have incomes below half the average income (after housing costs)[31]—a commonly used yardstick to measure poverty—compared to 19 per cent of lone parents in 1979. In 1996 a third of lone mothers (33 per cent) and over a quarter of lone fathers (27 per cent) had a gross weekly income of £100 or less, compared with 3 per cent of married couples and 6 per cent of cohabiting couples.[32] The Government's Green Paper on child support reform stated that 1.8 million children lived in families in receipt of benefit, where no child maintenance was being received from the non-resident parent.[33] The Government estimated that only around 250,000 of the almost 1.5 million children on the books of the Child Support Agency were gaining financially from child support payments.[34] This not only reflected non-payment of child support by non-resident parents, but also the fact that 44 per cent of parents with care who had been assessed for child support were on Income Support or income-based Jobseeker's Allowance.[35]

Putting policy into practice

  11. The failures of the policy behind the original Child Support Act have been compounded and in part caused by the continued and repeated failure of the Child Support Agency to deliver an acceptable standard of administrative performance. In their study Child Support in Action, Professor Gwynn Davis and Professor Nick Wikeley referred to "a catastrophic administrative failure leading to abandonment of many of the basic tenets of administrative justice",[36] a judgment which they told us in oral evidence was "rather under-stated."[37]

12. The new Child Support Agency when it began had as one of its aims, to "ensure that maintenance assessments and payments are accurate and regular."[38] The latest report of the Comptroller and Auditor General (C&AG) on the Child Support Agency's accounts for 1998-99 shows that 35 per cent of receipts from non-resident parents were for the wrong amounts[39]; and 79 per cent of full maintenance balances contained errors, including one in five cases where the errors were greater than £1000.[40] Most maintenance assessment errors were due to mistakes in calculating the income (32 per cent) and housing costs (23 per cent) elements of the assessment. The C&AG pointed out that almost one in four of current assessments made in 1998-99 were incorrect.[41] Over £4.35 million in compensation had been paid out in the course of the year as a result of administrative errors or delays.[42]

13. As each Member of Parliament is only too aware, the Child Support Agency has been a major source of complaint ever since it began its operations. By the end of 1994 complaints against the Child Support Agency made up over one-third of the total of all complaints against all departments being referred to the Parliamentary Ombudsman.[43] The Parliamentary Ombudsman made two special reports to Parliament on the CSA's failings.[44] Since Mrs Anne Parker took up her post in April 1997 as the Independent Case Examiner, the number of complaints against the Agency being referred to the Parliamentary Ombudsman has started to fall back and he has not felt it necessary to lay a third special report before Parliament. Even so, in each of his last three annual reports to Parliament, the latest of which was published in July 1999, he has continued to criticise aspects of the Child Support Agency's performance.[45] The Independent Case Examiner has presented two Annual Reports to Parliament, and she assured us that there had been a "sea change" with the Agency putting "much more energy going into engaging with the complainants, resolving complaints and moving forward systemic recommendations."[46]

4   Reports from the Social Security Committee: Second of 1990-91 Changes in Maintenance Arrangements(HC 277-I); Third of 1990-91, Changes in Maintenance Arrangements: The White Paper 'Children Come First' and the Child Support Bill, (HC 277-II); First of 1993-94, The Operation of the Child Support Act (HC 69), Fifth of 1993-94, The Operation of the Child Support Act: Proposals for Change (HC 470); Second of 1995-96, The Performance and Operation of the Child Support Agency (HC 50); Fourth of 1994-95, Child Support: Good Cause and the Benefit Penalty (HC 440);Fifth of 1996-97, Child Support (HC 282). Government Replies: to Second and Third Reports of 1990-91, Cm 1691;to First Report of 1993-94, Cm 2469; to Fifth Report of 1993-94, Cm 2743; to Second Report of 1994-95, Cm 3191; to Fourth Report of 1994-95, Cm 3449. A response was not required to the Fifth Report of 1996-97. See also First Report from Committee of Public Accounts, Session 1995-96, Department of Social Security: Appropriation Accounts 1993-94: Child Support Agency (HC 31); Twenty-first Report from Committee of Public Accounts, Session 1997-98, Child Support Agency: Client Funds Account 1996-97 (HC 313). See also Treasury Minute responding to First Report of 1995-96 in Cm 3172 and Third Report from the Select Committee on the Parliamentary Commissioner for Administration, Session 1994-95, The Child Support Agency (HC 199) and the Government's Response Cm 2865.  Back

5   Cm 4349, Foreword, page viii. Back

6   Cm 3992. Back

7   See List of Witnesses pages xlvii-xlviii. Back

8   Ev p 107 para 6. Back

9   Children Come First, Cm 1264, Vol One, para 1.5. Back

10   Children First: a new approach to child support, Cm 3992, page 12, para 22. Back

11   Cm 1264 ,Vol One, para 2.1. Back

12   We follow the usage in the White Paper. Accordingly, parents who are looking after children for whom child support is payable are called 'parents with care'. The majority of parents with care are women and so for convenience they are sometimes referred to occasionally as 'mothers' or simply 'she'. Similarly, parents who are liable to pay maintenance are referred to as 'non-resident parents' or sometimes as 'fathers' or simply 'he'. Back

13   Child Support Agency Quarterly Summary of Statistics, May 1999, DSS. Back

14   Cm 1264 ,Vol One, para 2.1. Back

15   Cm 1264, Vol Two para 4.1.1 and Table 12. Back

16   Child Support Agency Quarterly Summary of Statistics, May 1999, DSS. Back

17   Cm 1264 ,Vol One para 2.1. Back

18   By the Social Security Act 1998. Back

19   Child Support Agency, Annual Reports and Accounts, 1998-99, page 103, para 3.32.  Back

20   HC Deb 22 July 1999 vol 335 col 574w. Back

21   HC Deb 22 July 1999 vol 335 col 574w. Back

22   Cm 1264, 1990. Back

23   Cm 1264, Vol Two, page ii, para 5. Back

24   Child Support Agency, Annual Reports and Accounts, 1998-99, July 1999 page 28. Back

25   Child Support Agency, Annual Reports and Accounts, 1998-99, July 1999 page 28. Back

26   Cm 1264, Vol One, para 2.1. Back

27   Cm 4349, Chapter Two page 12 para 19. Back

28   Cm 4349, Chapter One page 2 para 5. Back

29   Prime Minister's Foreword to White Paper, "A new contract for welfare: Children's Rights and Parents' Responsibilities", Cm 4349, Foreword page vii. Back

30   Cm 4349, Foreword page viii. See also Opportunity for all-Tackling poverty and social exclusion, First Annual Report 1999, Cm 4445, September 1999, Chapter 3, paras 39 and 40. Back

31   Households Below Average Income 1979-1996-7, DSS. 1998 Back

32   Living in Britain: Results from the 1996 General Household Survey, ONS, 1998. Back

33   Cm 3992, Chapter Two page 12 para 21. Back

34   Cm 4349, Chapter One page 1, para 3. Back

35   Child Support Agency Quarterly Summary of Statistics, May 1999, DSS. Since any child maintenance received is deducted pound for pound from the amount of benefit payable, parents with care on these benefits do not receive any financial advantage from receipt of child maintenance. Back

36   Child Support in Action, Davis and Wikeley , Hart, 1998, page v. Back

37   Q. 50. Back

38   Child Support Agency Business Plan, April 1993, page 4. Back

39   Child Support Agency Annual Report and Accounts 1998-99, Report by the C&AG, page 93 para 2.2.  Back

40   Child Support Agency Annual Report and Accounts 1998-99, Report by the C&AG, page 93 para 2.5. Back

41   Child Support Agency Annual Report and Accounts 1998-99, Report by the C&AG, page 100 para 3.17. Back

42   Child Support Agency Annual Report and Accounts 1998-99, Report by the C&AG, page 95 para 2.14. Back

43   Ev p 24 para 4. Back

44  Third Report of 1994-95,Investigation of complaints against the Child Support Agency (HC 135) and Third Report of Session 1995-96, Investigation of complaints against the Child Support Agency, (HC 20). See also Third Report from the Select Committee on the Parliamentary Commissioner for Administration, Session 1994-95, The Child Support Agency (HC 199) and the Government's Response Cm 2865.  Back

45   Ev p 25 para 6. See Annual Reports from the Parliamentary Commissioner for Administration: for January to December 1996 (HC 386 of 1996-97); for January 1997 to March 1998 (HC 845 of 1997-98); for April 1998 to March 1999 (HC 572 of 1998-99). Back

46   Q. 79. Back