Schedule 1
Child Maintenance and Other Payments Bill
1:30 pm
Paul Rowen (Shadow Minister, Work & Pensions; Rochdale, Liberal Democrat)
In the latter part of an earlier speech, the Minister touched on some of the CSA’s current problems with regard to historic debt. The amendments seek to ensure that proper arrangements are in place to deal with that issue when CMEC becomes operational.
The first amendment would ensure that the auditor general of the National Audit Office included the matter of historic debt in that body’s report to Parliament, when CMEC’s accounts are discussed. That is important because the debts are substantial. We need to ensure that they are taken into account, given that a different model was suggested in the Henshaw report, whereby CMEC would not deal with historic debt.
The second amendment adds the matter of historic debt to the remit of the annual report that the commission must present to the Secretary of State. Again, it is important that a regular report is made to the Secretary of State and to Parliament, through the Select Committee on Work and Pensions, to ensure that we know what has happened in that regard, given the size of the debt. We want to ensure that the historic debt functions of CMEC are mentioned explicitly in the Bill, and that accountability for the historic debt is established. That is important because we do not want historic debt to be overshadowed by the introduction of the new assessments process and the so-called clean break. New arrangements do need to be put in place, but there must be increased concentration on ensuring that the historic debt, which affects a substantial number of children, is not forgotten or washed away.
A generation of children is growing up—some of them have already grown up—without the maintenance that they are owed, because the CSA failed to take into account proper debt collection and enforcement. I submit that that is a contributory factor to the high level of child poverty in this country. We need to understand the nature of the debt and how much of it can and should be collected. In setting up CMEC, we must work to ensure that that money will be collected.
The CSA annual report 2006 refers to at least £1 billion of child support money that the CSA regards as collectable. I hope that when the new enforcement powers in the Bill are introduced in 2008, the debt recovery target—currently £213 million by March 2009—will be reconsidered. It will be intolerable if it is not made a priority to recover that £1 billion, which should be being used to give children the start in life that they deserve by enabling them to be looked after. We seek, through the amendment, to ensure that the target is even higher than £213 million. I hope that the Minister will give us an indication as to what he believes will be collected, given the substantial new powers in the Bill.
I accept that only a small percentage of the historic debt has been written off, which we welcome. However, we are concerned that the real reason for that is that the collection of large sums of money has been quietly dropped, because it is too difficult or too expensive to pursue. In England and Wales, for example, debts of £760 million are currently not being pursued, because they are more than six years old and therefore cannot be subject to a liability order in the courts. We need to know what CMEC will do to ensure that more of the money is collected.
If the commission decides not to take action to recover the debt, the parent with care needs to be told that the debt is going to be written off. At the moment, many constituents who come to us about the fact that the CSA is not bothering to recover debt have not been told. If a decision is taken that a debt will not be collected because it is too difficult, we would like the parent with care to be informed. More than that, if it can be proved that it is the fault of the CSA or CMEC that the debt has not been pursued, some form of compensation should be paid to the parent with care to ensure that account is taken of that non-recovery. In the evidence-taking session on Tuesday, we heard what people had to say about the level of child poverty and why it is important that the money should be paid. If there is to be a write-off, it should come with compensation paid by CMEC.
The debt recovery problems that the CSA has encountered are listed in the 2006 NAO report on the agency: inability to list all non-resident parents who have accrued debt either in the CSCS, the original computer system, or CS2, the new one; inability to mark as high-risk those cases with a history of high enforcement action; inability of CSA accounting systems to identify the debtors with the largest debts or the most persistent offenders; and the fact that the CSA’s enforcement directorate dealt with only 19,000 of the 247,000 cases of non-compliance or partial compliance in the UK, which is only 7 per cent. of the total.
Although I welcome a new start and a new organisation with tougher enforcement powers, we want a commitment that those enforcement powers will be used to ensure that the children who have been left behind and have not had the start in life that they were guaranteed get what they deserve. Considering the CSA’s powers, if debt is written off, it is CMEC’s responsibility to pay compensation.