Fourth Standing Committee
on Delegated Legislation
Thursday 9 September 2004
[Janet Anderson in the Chair]
Child Support (Miscellaneous
Amendments)
The Chairman: First, I advise members of the Committee that if they would like to remove their jackets on this warm, sunny afternoon, that would be in order with the Chair.
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The Parliamentary Under-Secretary of State for Work and Pensions (Mr. Chris Pond): I beg to move,
That the Committee has considered the draft Child Support (Miscellaneous Amendments) Regulations 2004.
I wonder whether we should be wearing those fluorescent jackets that are worn on building sites, and perhaps hats as well. I am sure that I speak for the whole Committee, Mrs. Anderson, when I say how pleased we are that you are chairing our proceedings this afternoon.
As the name suggests, the regulations make various amendments to several sets of regulations that govern child support. They cover the new arrangements and the regulations that provide for the transfer of cases from the old to the new scheme.
The package also includes amendments to the old scheme regulations that continue to apply to those cases that are still operating under the old rules. Hon. Members will be aware that there have been certain problems with the information technology system and will share my frustration that I am still unable to tell the Committee when those problems will be fully resolved. The Child Support Agency is working with Electronic Data Systems to correct the defects as a matter of urgency, but we have made it clear that we will not make arrangements to transfer cases from the old scheme to the new one until we are satisfied that it is working well. That is the context in which we are considering the regulations. In the meantime, we must ensure that the legislation for both schemes is kept up to date and is fit for purpose, and that is why we have introduced this group of changes.
Some of the amendments in this package are prompted by changes made elsewhere that must be reflected in child support: for example, the introduction of education maintenance allowances. Other amendments make minor technical and clarifying adjustments, and I shall try to deal briefly with each in turn.
Hon. Members will have seen the schedule that has been provided. I am sure that they all sought to absorb it earlier today, perhaps like myself with a wet towel around their head. The schedule shows how the amended regulations will look. I make it clear that it is intended for guidance only. I hope that it is helpful, but it is not an authoritative statement of the law.
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Turning to the amendments, regulation 2 amends regulation 6B of the Social Security and Child Support (Decisions and Appeals) Regulations 1999, which, among other things, provide for decision making in child support. Regulations 2(2)(a) and 2(2)(b) of these regulations make minor clarifying changes of a somewhat technical nature in respect of the operation of the tolerance rule. Briefly, the rule means that small changes in income are ignored and do not lead to changes in maintenance due. Broadly, those are changes of less than 5 per cent. of net income. It provides parents with some stability and certainty regarding the amounts of maintenance payable.
Regulation 2(2)(a) ensures that, if income and non-income changes are notified at the same time and maintenance is to be recalculated as a result of the non-income change, the new liability will be adjusted to take account of both changes, irrespective of whether the income change would, by itself, breach the tolerance rule. Regulation (2)(2)(b) clarifies the policy in cases where a reported change in income did not breach tolerance, so maintenance remained unaltered, and a subsequent change is reported on non-income grounds that leads to a change in the amount of child support maintenance payable. In such cases, regulation 2(2)(b) will ensure that the new liability takes account of both changes, with an effective date linked to the later change.
Regulation 3 amends the Child Support (Information, Evidence and Disclosure) Regulations 1992, which govern the gathering and disclosure of child support information. The amendment clarifies that if an appeal is made to an independent tribunal, the Secretary of State may disclose the relevant information to all the parties to that appeal. I believe that members of the Committee will agree that that is a sensible move.
Regulation 4 amends regulation 17 of the Child Support (Maintenance Assessment Procedure) Regulations 1992, which provide for the revision of decisions in the old child support scheme. The amendment mirrors changes that have already been made to the Social Security and Child Support (Decisions and Appeals) Regulations 1999 for new scheme cases. It allows decision makers to revise a decision that has been appealed and lapse that appeal at any time between receipt of the appeal and determination at an appeal tribunal.
Regulation 5 makes a number of amendments to the Child Support (Maintenance Assessment and Special Cases) Regulations 1992, which provide the basis for the assessment of old scheme liabilities. One amendment is made as a consequence of the introduction of the education maintenance allowance, which, as the Committee knows, is made to young people aged 16 or over who remain in education. The amendment ensures that those allowances do not count as income. Other changes made by this regulation allow for travel to work costs to be calculated in metric measurements instead of imperial.
A further amendment made by regulation 5 reflects financial help recently introduced by the Government
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for employees who have become fathers or have adopted a child. In common with similar payments, statutory maternity pay and statutory adoption pay are included as earnings for the purpose of assessing maintenance in the old scheme. An identical amendment to cover the new child support scheme appears in regulation 7.
Regulation 6 amends regulation 29 of the Maintenance Calculation Procedure Regulations 2000, which provides for effective dates or start dates for child support liability in specified cases. The amendment provides new initial effective dates for multiple parent with care cases, where liability in respect of the first parent with care has ceased before a maintenance calculation in respect of the new parent with care has been made.
Regulation 7 amends the Child Support (Maintenance Calculations and Special Cases) Regulations 2000, which provide for the calculation of child support maintenance in the new scheme. One amendment mirrors the one in regulation 5, providing for statutory adoption pay and statutory paternity pay to be treated as earnings.
The remaining amendments in this regulation are intended to clarify the legislation and to ensure that it reflects the policy intention. They clarify that social security benefits are net weekly income, but for the purposes of establishing only whether a non-resident parent will have nil liability.
Regulation 8 makes several amendments to the Child Support (Transitional Provisions) Regulations 2000, which make provision for how old cases will be transferred on to the new child support scheme and also allow changes in liability to be phased in over a period of up to five years in specified circumstances.
In the main, the amendments ensure that the provisions work as we intended. One important amendment clarifies the fact that a conversion decision can be made on those cases where an outstanding departure direction, revision or supersession cannot be resolved because more information is needed. The conversion decision will be based on the information used or considered to make the maintenance assessment being converted. When full information becomes available, both the old and the new scheme decisions will be revised or superseded as necessary.
Amendments made by regulation 8 allow the child support payable to a parent with care in the new scheme to be adjusted in respect of overpaid maintenance paid by a non-resident parent under the old scheme. Another amendment allows payments made by a non-resident parent in the new scheme to be attributed to arrears that accrued under a maintenance assessment in the old scheme.
Regulation 9 contains two minor technical amendments to the Child Support (Variations) Regulations 2000, which allow for child support maintenance calculations to be varied in specified circumstances. There are a number of circumstances when a variation may apply, for example when contact costs are incurred.
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The regulations before the Committee underpin our commitment to making sure that child support works for parents and for their children. I am satisfied that they are compatible with the Human Rights Act 1998. They reflect the Government's commitment to the fair and effective operation of child support, and I commend them to the Committee.
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Mr. Paul Goodman (Wycombe) (Con): As the Minister said, it is indeed a pleasure to see you in the chair, Mrs. Anderson. As you and members of the Committee know from correspondence with often aggrieved and exasperated constituents, these regulations are set against a background of serious problems—to which the Minister diplomatically referred as ''certain problems''—at the Child Support Agency. First, there is the continuing difficulty with the CSA's computers; and secondly, there is the linked and continuing delay—to which no end is apparently in sight, as the Minister reminded us—of the transfer of cases from the old to the new scheme.
The Minister knows that the Work and Pensions Select Committee, which is dominated by members of his party, recently described the Department's IT record as ''lamentable'' and said of the CSA's telephone and computer budget that it was
''over spec, over budget and overdue.''
Sections 8, 9A and 9B of the regulations seek to amend the Child Support (Transitional Provisions) Regulations 2000, which deal directly with conversion from the old to the new scheme. So, I should like to ask the Minister about a matter that has occupied Committees whenever the regulations come before us—the so-called 13-week loophole. Do the proposed amendments have any bearing on it? This is perhaps the most serious and unresolved matter that comes up whenever the regulations do.
The Minister is aware that the National Association for Child Support Action, among others, has claimed that the apparent loophole contravenes the intention of the regulations. Essentially, the intention of the regulations is to ensure that both non-resident parents and parents with care have time to adjust to a new and different system of maintenance. An important method of adjustment is the phasing in of payments. However, the regulations state that, if a case remains closed for more than 13 weeks, any fresh application will result in that case being administered with, in effect, no phasing-in period.
It follows that a parent with care could approach the CSA on one date asking for a case to be closed and then approach it 13 weeks later to obtain a larger amount of maintenance by avoiding phasing in. That would obviously have a serious effect on a non-resident parent on low income. NACSA reports that it is of the opinion that a non-resident parent in that situation could apply to the CSA to prevent the 13-week period being abused in that way.
However, NACSA also reports that it has
''approached the Child Support Agency for clarification upon this issue. The view of the agency is that the action of the person with care, in closing a case, will over-ride any application by the non-resident parent in applying for the case to remain open''.
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Consequently, NACSA and others believe that the Child Support (Transitional Provision) Regulations 2000, which the regulations amend in certain ways, are demonstrably unfair and unbalanced, and that they could never secure what they set out to achieve.
When child support regulations were last put before a Committee, the Minister said that he would keep the 13-week arrangement under review. So, I ask him again whether the regulations affect that rule? If not, will he explain why he did not table amendments to the 13-week rule in the regulations, since he presumably had the opportunity to do so? Has he made, or will he make, an assessment of how many parents with care are using the loophole in the way that concerns NACSA and others? What conclusion has he drawn from keeping the 13-week rule under review, as he said he would do when the regulations were last debated before a Committee?
Regulation 7(4) states that:
''the net weekly income of a non-resident parent shall include payments made by way of benefits, pensions and allowances''.
That is a significant section of the regulations. Does the net weekly income include tax credits? I ask simply because NACSA has written to the Inland Revenue solicitors' office to ask why payment of child tax credit is included in the calculation and payment of child support maintenance by the non-resident parent. NACSA says that
''in appropriating child tax credit from the family to whom it is awarded, and paying it to another family, the Child Support Agency is imposing a lower standard of living assessment for children in the care of a non-resident parent''.
My final point relates to the amendments as a whole. In the case of what the Minister described as the ''technical'' amendments, have loopholes been discovered that the regulations seek to close or are there other reasons for the introduction of the regulations?
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