COMMITTEE FOR SOCIAL DEVELOPMENT
OFFICIAL REPORT
(Hansard)
Child Maintenance Bill
17 April 2008
Members present for all or part of the proceedings:
Mr Gregory Campbell (Chairperson)
Mr David Hilditch (Deputy Chairperson)
Mr Mickey Brady
Mr Thomas Burns
Mr Fred Cobain
Mr Fra McCann
Mrs Claire McGill
Miss Michelle McIlveen
Witnesses:
Mr Chris Matthews )
Mr John O’Neill ) Department for Social Development
Ms Margaret Sisk )
The Chairperson:
I welcome Mr Chris Mathews, Mr John O’Neill and Ms Margaret Sisk from the Department for Social Development to brief the Committee on the Child Maintenance Bill.
Mr John O’Neill (Department for Social Development):
The Department has provided the Committee with two documents on the changes to child maintenance, and they provide much of the detail of what is in the Bill. I will give a brief — although it may not seem so — outline of the reform of the child-maintenance system and what the Child Maintenance Bill will do.
The Child Support Agency was set up in 1993 because the system of collecting maintenance had lost the confidence of parents. The agency was designed to provide better support for children and families by ensuring that parental responsibilities were properly enforced. However, as has been widely recognised, the system was too complicated and attempted to take too many factors into account. The forms that were issued in 2000 simplified the way in which maintenance was calculated. However, although the number of cases that receive maintenance payments has increased, problems have persisted.
In February 2006, the then Secretary of State for Work and Pensions, John Hutton, asked Sir David Henshaw to lead a redesign of the child-support system. Sir David recommended a new system that would be simpler to use and administer, would be tougher on parents who do not face up to their responsibilities and do more to reduce child poverty. Consultation on the proposals for the reform of the system took place from 13 December 2006 to 13 March 2007 throughout the UK. The two responses from Northern Ireland stakeholders were broadly favourable.
The Child Maintenance Bill makes tackling child poverty the number-one priority for the child-maintenance system. The Bill breaks the link between child maintenance and the benefit system, and it gives parents the power to manage child maintenance in a way that is best for them and their children. Where parents cannot agree on how to support their children, the information and support service will be there to explain the options that are open to them, and the statutory maintenance scheme will be there as a fall-back option.
To provide a stronger incentive for parents with care of children to seek maintenance and for non-resident parents to pay, the amount of maintenance that parents with care who are on benefit can keep before it affects the level of benefit that they receive will be increased. The increase in that benefit disregard underlines the commitment to ensure that child maintenance does more to reduce child poverty.
For parents who choose or who need to make statutory arrangements, the system will be simplified and streamlined. The Department will be able to obtain details of the non-resident parent’s income directly from HM Revenue and Customs, rather than from the non-resident parent as is the case at present. The move from net to gross income means that no deductions will have been made for income tax or national insurance, and new percentages are designed to reflect that change. The intention in setting new rates is to minimise the impact on parents who move to the new statutory maintenance scheme. It is considered to be more likely that non-resident parents will be encouraged to comply voluntarily if their liability under the new scheme is within a reasonable range of their existing liability.
Although the changes will make the assessment process easier, some non-resident parents will still attempt to avoid their responsibilities to their children; in such cases, the Department will have new collection and enforcement powers. At this stage, it is important to emphasise that those enforcement powers will be used where non-resident parents will not pay. The Department will have the power to make liability orders administratively, and those will operate in the same way as the court-made orders currently work. That will make the process of enforcing payment of arrears quicker, and it will be a stepping stone to further enforcement action.
The Bill will enable the Department to use deductions from earnings orders as the primary method of collection. In the case of non-resident parents who have failed to pay child-support maintenance, the Department will have the power to collect money regularly and make lump-sum deductions from their accounts. That will enable child maintenance to be collected quickly and passed to the parent with care. The Bill will enable the Department to apply for a court order to freeze a non-resident parent’s assets, where there is evidence that he or she is about to dispose of those assets in order to avoid paying child-support maintenance.
If those enforcement methods are unsuccessful, the Bill provides for further measures to encourage non-resident parents to comply. For example, the Department could consider withdrawing the non-resident parent’s passport. The right balance must be struck between using powers that enable non-resident parents to pay and depriving people of the means to live and any income that will support their children.
The provisions are intended as a last resort to be used if maintenance money remains outstanding after direct forms of enforcement have been attempted. The refusal of certain non-resident parents to pay the maintenance money that they owe can have serious consequences for parents with care and their ability to provide for their children.
The extension to the range of enforcement proposals will allow non-resident parents to continue to earn a living, contribute to the support of their children and maintain contact with them. All the child-maintenance enforcement proposals are designed to achieve compliance and are targeted at those who refuse to pay rather than at those who cannot pay.
The Public Accounts Committee’s recent report stated that non-resident parents owe £71 million in child-support maintenance, and it recommended that all avenues be pursued to reduce that level of arrears. One of its recommendations was that, in addition to making more use of the enforcement powers that exist, the Department should pursue additional powers that could help to reduce the level of debt. The new enforcement powers should go some way to implement that recommendation.
The Bill will provide for the Department to negotiate and accept settlements between non-resident parents and parents with care. Where the debt is due to be paid to the parent with care, a decision to accept a lesser amount will be taken only with the agreement of that parent. The Bill will also give the Department the power to recover arrears from the estates of deceased non-resident parents. The aim of the reform of the child-maintenance scheme is to reduce child poverty and secure a reliable flow of maintenance from non-resident parents, and this is an important step.
The Chairperson:
I accept that the enforcement proposals would be applied in the worst-case scenarios, but will the Bill allow for a non-resident parent to have his or her passport withdrawn, be disqualified from driving and be subject to a curfew?
Mr J O’Neill:
Yes, because those powers are granted in the Bill. However, they should be used as a last resort — if someone is deliberately avoiding payment, stricter measures are required.
The Chairperson:
Would the situation that I outlined be the result of a gradual process?
Mr J O’Neill:
Yes. If we can access someone’s earnings to extract the maintenance money, there is no problem. However, in some cases it is difficult to gain regular access to the money of a non-resident parent, which has been a particular problem with self-employed people. If a non-resident parent has an employer, the Department can go to the employer to take money regularly. However, that is more difficult to do with self-employed people, some of whom have deliberately used that loophole to avoid their responsibilities. Other methods are required.
The Chairperson:
I am sure that you know about the Child Support Agency and the problems that people have reported to public representatives about delays, bureaucracy and getting the process to move. Given the considerable additional powers in the Bill, what assurance is there that that bureaucracy will lessen rather than increase?
Mr J O’Neill:
One of the difficulties with the Child Support Agency was that it tried to take too much information into account, which elongated the process of getting money to parents with care. The move to a system that uses financial information that is already available — for example, through information from the Inland Revenue — makes it easier to begin processing payments. Making the system simpler will increase people’s confidence in it and that it will — in theory — operate more efficiently. It will also link the benefits system with the child-support system and ensure that parents with care receive more money.
The Chairperson:
I note that you used the words “in theory”.
Mr J O’Neill:
Yes; I remember that the previous reforms had the same objectives.
The Chairperson:
We know what the results of those reforms were.
Mr J O’Neill:
I do not have to answer for the results of those reforms.
The Chairperson:
I am not suggesting that you do, but there might be concerns.
I presume that the problem does not lie with non-resident parents who comply and who voluntarily enter into arrangements.
Mr J O’Neill:
The problem lies with those who could pay but do not.
The Chairperson:
They choose not to.
Mr J O’Neill:
Yes.
The Chairperson:
I presume that those worst-case scenarios are targeted at the more extreme elements among that type of non-resident parent. Will that approach simplify matters rather than make them more complicated?
Mr J O’Neill:
The system should operate more simply for most people.
Ms Margaret Sisk (Department for Social Development):
May I elaborate on what John said? Several issues will be dealt with in the Bill that will simplify the system; for example, the number of changes of circumstances that can be taken into consideration will be reduced. That will make the system much easier. As John said, one of the problems is that so many elements must be fed into a child-support assessment; it is extremely complex for staff to administer and for people to understand. The provisions in the Bill are designed to make the system easier for people to administer and to understand. The long-term aim is to reduce the number of problems.
Throughout the Bill, there are also provisions for people to appeal against their maintenance calculations if they believe them to be incorrect. There are also appeals against the enforcement mechanisms that will be carried out through the courts in the normal way. Safeguards have been built into the Bill.
Mr Brady:
The legislation is based on the premise that the non-resident parent lives in the jurisdiction. For a long time, I worked in an advice centre in the area that I represent and know that many non-resident parents lived across the border a few miles away. Therefore they could not be pursued.
The other matter that I want to raise is the surrender of passports. Many people have two passports. Can only one be surrendered?
Ms Sisk:
The surrender of passports is just one of the options that could be used. The court or whoever makes the decision must decide which option is best in any given circumstances. Of course, the Department absolutely recognises the point that the member raised about non-resident parents who do not live in Northern Ireland.
Mr Brady:
Is it possible to pursue the matter through European channels? We are all part of the European Union, regardless of where we live. This has been going on since 1993.
Mr J O’Neill:
Reciprocal enforcement of maintenance orders (REMOs) are a means to enforce, in the Republic or elsewhere, maintenance orders that are made in Northern Ireland through a system that connects the courts service in various countries. Therefore if a maintenance order exists, it can be enforced.
Mr Brady:
In my experience, the number of maintenance orders that are enforced is minimal.
Ms Sisk:
The Child Support Agency and the new body would not be able to deal with those cases. They would have to go through the courts because the North and the Republic are — how should one put it? — separate countries, if you understand what I mean.
Mr Brady:
That is the problem.
Ms Sisk:
Yes, I recognise that.
Mr J O’Neill:
Not all member states have a child-support system; therefore in certain countries there is no system with which to deal.
Mrs McGill:
I wish to ask about the response from Advice NI in particular and Disability Action on the equality impact assessment. Advice NI’s response is that:
“The regulatory impact assessment completed by the Department for Work and Pensions stated that there will be an impact on females, black and minority ethnic groups and people with disabilities”.
It goes on to say that:
“these issues have not been picked up in the Equality Impact Assessment.”
I have read your response to that. You have, in effect, chosen to ignore Advice NI’s point.
Ms Sisk:
If I recall correctly, Advice NI’s concern was voluntary arrangements; that parents with care in vulnerable groups could have a problem getting maintenance because they belong to those groups. However, a new information and support service will be provided specifically designed to protect the interests of vulnerable people. Chris can tell you more about our plans for the information and support service if that would be helpful.
Mrs McGill:
I wanted to draw attention to Advice NI’s comment. Will the Department continue to implement the policy reforms as intended?
Ms Sisk:
The information and support service will serve target groups that are considered to be vulnerable, and it will offer them advice and assistance.
Mr Chris Matthews (Department for Social Development):
Although the information and support service will encourage people to make voluntary arrangements, it would also ensure that those who need the statutory maintenance service can avail of it. The service will pick up on any group, vulnerable or otherwise, that needs help and it will ensure that everyone is treated fairly. The statutory service will be there for anyone who needs recourse to child maintenance — perhaps parents who cannot agree to a voluntary arrangement or who may feel under pressure from the non-resident parent. The statutory service will ensure that every case is actioned, and, as is the case at the minute, matters can be taken forward on an individual’s behalf.
Mrs McGill:
Nevertheless, the Department did not take Advice NI’s point that:
“these issues have not been picked up in the Equality Impact Assessment.”
Ms Sisk:
We do not have evidence that the groups that were mentioned will be adversely affected by the new policy. However, as I said, the information and support service would be available to help those groups if any issues should arise. We do not see how the new policy will adversely affect those people.
Miss McIlveen:
Were there only three responses to the consultation?
Ms Sisk:
Yes, there were only three responses from Northern Ireland.
Miss McIlveen:
That is interesting.
The Chairperson:
When is the Bill likely to be introduced?
Mr J O’Neill:
The GB Bill is expected to receive Royal Assent in early June. The question will be whether the Minister will wish to seek accelerated passage.
The Chairperson:
Again?
Mr J O’Neill:
Yes. We have given the Committee material about parity arrangements, which I think we will discuss later. However, it is likely that a request for accelerated passage will be made for all social security, child support and pensions legislation, simply because of timing and the need to maintain parity. The Minister will decide whether she wants to seek accelerated passage; if she does, she will come to the Committee and will also seek the support of Executive colleagues.
The Chairperson:
If she decides to request accelerated passage, when is she likely to come to the Committee? Would it be before recess?
Ms Sisk:
Yes, absolutely.
Mr J O’Neill:
If she requests accelerated passage, she will try to get the legislation through before recess because under current proposals certain developments may occur in Great Britain in the autumn that flow from the legislation.
The Chairperson:
The Clerk requested that the Department’s initial documentation on the Bill be presented in a revised format. The current format is helpful, as it lets members know the current policy position and what the proposed changes will mean. Members can see the potential benefit or disbenefit at a glance. Can we ensure that the format is the same for information on future Bills?
Mr J O’Neill:
As far as possible, yes. It may not always be appropriate to format the information in such a way; for example, if the policy is totally new and there is no other policy with which to compare it.
The Chairperson:
Obviously if there is no existing policy, it will not be possible to present the information in that format.
Mr J O’Neill:
Where existing legislation is being amended, we will try to present the information in that format.
The Chairperson:
OK. Thank you very much for appearing before the Committee today.