House of Commons - Social Security

Select Committee on Social Security Tenth Report

THE 1999 CHILD SUPPORT WHITE PAPER

COMPLIANCE

76. A principal theme of the White Paper is the need to increase the level of compliance with the CSA. Baroness Hollis told us that the Government hoped to increase compliance to at least 80 per cent of cases and 85 per cent of the money owed by non-resident parents.[219] There are several strands to the policy which aim to increase compliance, ranging from financial incentives to criminal penalties. We welcome incentives for parents to co-operate and comply with the Child Support Agency.

77. CSA staff spend on average 90 per cent of their time making assessments and only 10 per cent of the Agency's resources are left for chasing up parents who are behind with their maintenance payments.[220] Baroness Hollis hoped to see the balance "at least reversing."[221] The Chief Executive of the CSA hoped that the simplification of the assessment process would allow much greater effort to be put in to ensuring compliance.[222] Some witnesses agreed that the simplified formula could help in increasing compliance.[223] Representing the staff of the CSA, the view of the Public and Commercial Services Union PCS was that: "The lesson of the current scheme is that there is no point pouring resources into telling someone how much to pay if that leaves insufficient resources to ensure the person actually does pay."[224] Mr Mostyn for the Family Law Bar Association warned that it would be "dangerous to assume that there is necessarily a causal connection between compliance and simplicity."[225] He told us that even with a relatively simple formula the rate of compliance was lower in Australia than in the United Kingdom.[226]

78. The child maintenance premium should act as an incentive for parents with care on Income Support to co-operate with the CSA and also as an incentive for the non-resident parents of their children to comply, as the income going into their children's home will increase at least by a little, unlike at present.[227] Similarly a non-resident parent of children whose parent with care is in receipt of Working Families Tax Credit will know that the full amount of child support payments will be added to the income of the parent with care. Baroness Hollis told us that reducing the level of assessment and staff action to "build up the compliance expectation" were more likely than maintenance disregards to increase compliance.[228]

Enforcement

79. The White Paper proposes a range of sanctions against parents, in addition to those which exist in the current scheme. The new powers would include fines and a late payment penalty of up to 25 per cent of the maintenance due. There is also a commitment to consider other punitive measures, including removal of driving licences, removal of passports and seizure of assets for non-payment. Baroness Hollis emphasised that enforcement was a last resort: "Enforcement is what happens when you do not get compliance."[229] She told us that "we will kick in with enforcement ... when compliance has failed."[230] We were told that one of the CSA's problems in the past was that by not following through threats by imposing sanctions, the Agency had in effect encouraged noncompliance.[231]

80. The Government has correctly identified that a problem exists regarding the present ability of parents to withhold information or lie about their circumstances without penalty. A recent report by the Benefit Fraud Inspectorate on the Child Support Agency referred to staff perceptions of a culture of 'it's OK to lie to the CSA.'[232] Some witnesses questioned whether the introduction of criminal sanctions for failure to provide information or deliberate misrepresentation[233] would, by itself, alter this culture. Professor Nick Wikeley described the new measures of enforcement, in particular the new criminal offence of lying to the Agency as "pure rhetoric;" his colleague Professor Gwynn Davis added that it was "probably eyewash."[234] The Independent Case Examiner warned that "the intention to introduce penalties for supplying false information, etc, may well lead to further administrative complication ... our experience of the Agency's handling of the present limited range of penalties shows that they need to be workable and consistently applied."[235]

81. The Benefit Fraud Inspectorate team noted that the current standards employed within the Child Support Agency to obtain and verify information provided by customers were "lower than those that normally apply. Staff process cases on the basis that the customer has the 'right to be believed'..."[236] One source of verification of information provided to the Child Support Agency is information from other DSS systems. The Benefit Fraud Inspectorate found that CSA staff knowledge of these systems was variable and that staff reported receiving little or no training in this area. As far as the Inspectorate could ascertain, there had been no analysis of the use of these systems to help verify information on maintenance applications.[237] We recommend that greater attention should be given to improving the CSA's internal processes for verifying information on the lines proposed by the Benefit Fraud Inspectorate.

82. The Benefit Fraud Inspectorate team drew attention to the existing sanction, whereby anyone who refuses to give relevant information to an inspector appointed by the CSA may be prosecuted: "We were told that only one attempt has ever been made to use this sanction."[238] The White Paper states that the existing rules governing child support inspectors are inflexible and proposes that there should be additional flexibility for child support inspectors.[239] We recommend that the CSA should be required to include in its annual report to Parliament an account of its counter-fraud activities, including details of the use made of its existing powers.

83. The CPAG acknowledged that there was a serious problem with compliance in the current system. They suggested that the new system should be given a chance to work, and parents a chance to work with it, before a more punitive approach was adopted.[240] They pointed out that the current rules already provided for deductions from earnings orders, liability orders, distress and county court action and ultimately imprisonment for non-payment[241]. The CPAG argued that it might be premature to increase sanctions against parents before the new simplicity has been given a chance to work[242]. The CPAG was opposed to measures, such as the confiscation of driving licences or imprisonment, which could adversely affect child support and family life:

243

84. Dr Braun for the National Stepfamily Association cautioned against "inflaming situations which are already pretty inflamed."[244] Families Need Fathers pointed out that recourse to penal sanctions was not unknown in contempt cases arising out of matrimonial proceedings.[245] Mr Watson-Lee of the Law Society told us that there were divided views on the greater use of sanctions, but that the profession was concerned for civil liberties generally[246] and that the appropriate civil procedures should be exhausted before criminal sanctions are imposed.[247] Mr Nicholas Mostyn QC for the Family Law Bar Association told us that the removal of driving licences was used as a sanction in several States in the USA and that research had shown that where draconian measures were taken the rates of compliance had gone up considerably.[248] His strong view was that "compliance is causally connected directly to the robustness of the enforcement measures."[249]

85. We support the introduction of severe penalties for those who deliberately persist in fraudulent evasion of their responsibilities to their children, but we recommend that the interests of the children should be taken fully into account before action is taken to seek the imprisonment of a delinquent parent.

86. Some non-resident parents are unwilling to pay child maintenance at all and are prepared to use any means to avoid making contributions towards their children's upkeep. Mr Andy Farquarson of NACSA admitted "with no shame at all" that his organisation had been involved in a campaign of civil disobedience.[250] We condemn the tactics of any group which seeks to encourage non-resident parents to evade their responsibilities to pay child support.

87. Some recent publicity has been given to suggestions that the CSA should pursue under-age fathers for maintenance.[251] Mr Martin Barnes of the CPAG described the idea as "a bit daft."[252] During our final session of evidence, Baroness Hollis confirmed that the liability to pay maintenance would not be assessed until the non-resident father had an income on which to make an assessment.[253] We consider that it would be an unacceptable diversion of resources to pursue recovery of child support payments from parents below the age of 16.

Arrears

88. Because of the complexity and delays in the present CSA system, it is almost inevitable that arrears of maintenance will have accrued by the time a final maintenance assessment is reached. Any changes in a number of relevant circumstances may trigger a change in the assessment involving further delays and quite possibly the accumulation of additional arrears of payment due by the non-resident parent. The latest Child Support Agency accounts reported that £511.45 million was outstanding in child support debts and that a further £387.57 million had been classified as probably uncollectable.[254] Some of the debt is owed to the taxpayer, where a parent with care has been in receipt of benefit, but much of it is due from the non-resident parent to the parent with care on behalf of the children. NACSA demanded an amnesty on outstanding debt and arrears, where these were demonstrably due to delays or mal-administration by the CSA.[255] Some degree of writing off is probably inevitable, but there are two principal objections to an amnesty. In the first place, it would be wrong to break faith with those non-resident parents who have made sacrifices to comply with their obligations under the law. Secondly, as Baroness Hollis told us "it is not necessarily morally right ... to wipe out money that may be owed to children in struggling families."[256] We agree with the Government that there should not be a general amnesty for child maintenance debts.

89. Recent initiatives have encouraged positive use of debt management to encourage compliance. Where a non-resident parent has initial arrears arising from before the assessment is made and establishes regular payments of his current liability, he can apply to pay off only the last six months of arrears. An agreement, if made, is subject to the deterrent that the whole of the arrears would become payable if agreed payments ceased.[257] We welcome the constructive use of debt management to encourage compliance. We recommend that the Government should take the opportunity of the forthcoming primary legislation to allow Parliament to decide whether the Child Support Agency's power to write off or suspend arrears should be protected from challenge in the courts, taking into account the rights of the creditor parent with care.

90. Baroness Hollis described the problem of arrears as "an old problem" which she did not expect to be taken into the new system because of the speedier processing of maintenance applications under the new simpler formula.[258]

'Good cause'

91. Parents with care may be excused from co-operating with the CSA when they have 'good cause' for not seeking child support if there would be "a risk of a parent with care or any child living with her suffering harm or undue distress as a result."[259] The White Paper proposes that the maintenance process should flow directly from a benefit claim unless the parent with care specifically opts out. If a parent with care has no 'good cause' for not seeking child support but still refuses to help trace the non-resident parent, a reduction in benefit may be imposed. The White Paper proposes that the cooling off period after a benefit claim before imposition of a benefit penalty will be reduced from six weeks to four weeks. Baroness Hollis told us that the principle of having a 'good cause' exemption for parents with care would be protected, but that some of the arrangements for its administration would be simplified.[260]

92. The National Council for One Parent Families were disappointed with the retention of the benefit penalty for those parents with care who feel that it is not in the best interests of their children to co-operate with the Child Support Agency.[261] They were also concerned that having to opt out rather than opt in would mean that more people would be caught up in the system without understanding the implications.[262] One Plus described the proposal to change the procedures so that the maintenance process would flow directly from a benefit claim, unless the parent with care specifically opted out, as "extremely worrying."[263] One Plus was particularly worried that the CSA would be able to pursue non-resident parents without a mother's permission, if 'good cause' was not proven.[264]

93. The National Council for One Parent Families called for the new incentives to co-operate to be given a chance to work, and for the benefit penalty to be removed or at least reduced to its earlier level.[265] The National Association of Citizens Advice Bureaux were concerned about the existence of the benefit penalty which they saw as deepening poverty for people who were already poor. Mr John Wheatley of NACAB told us that there was evidence from citizens advice bureaux that the benefit penalty was applied unfairly in a number of cases where women had been unjustly penalised for failure to provide information, when they had in fact co-operated fully.[266]

94. The Child Poverty Action Group were pleased with the proposed retention of the current definition of 'good cause' and told us that they and many other organisations believed that the current definition was not itself the source of problems and was vital in protecting the welfare of children and parents.[267] The CPAG and the Children's Society noted that the Closer Working programme, under which Benefits Agency staff visited parents with care making a new claim for Income Support and completed CSA maintenance application forms, had made a dramatic difference to co-operation rates.[268] According to the CPAG, "To the extent there was ever a serious problem with co-operation—and there has never been any empirical evidence to indicate that was because of the good cause provision—this has now been reduced substantially."[269] The Children's Society called for the reduced benefit direction to be abolished as it "is unfair to families on low incomes and works to the detriment of their children."[270] The National Association of Citizens Advice Bureaux and the Public and Commercial Services Union PCS also called for the abolition of the benefit penalty.[271] The White Paper proposes to keep the reduced benefit penalty in place. The 'cooling off' period in which parents with care consider whether to apply for child support would be reduced from six weeks to four weeks under the new, radically simpler system.[272] We want the new incentives to be given a chance to work and we therefore recommend that the application of the reduced benefit penalty should be suspended during the phasing-in period to assess whether the incentives alone are successful in achieving higher compliance.