Danny Alexander (Shadow Secretary of State for Work and Pensions, Work & Pensions; Inverness, Nairn, Badenoch & Strathspey, Liberal Democrat)

I have a few brief questions to put to the Minister. Because clause 12 relates to the transfer of functions from the Child Support Act 1991, and therefore, in many cases, effectively from the CSA to CMEC, this is a good opportunity to ask some questions about the nature of, and planning for, the transition between the two organisations, although there may be further opportunities to raise such issues.

The clause cuts to the heart of questions about the administration of the transition. It will transfer a substantial number of functions under the 1991 Act to CMEC, except those listed in subsection (2)—the exceptions are dealt with clearly in the explanatory notes. I note in passing that the Work and Pensions Committee, in a report in March this year, stated:

“The CSA has an unfavourable history regarding transition between systems.”

If transitions from the old to the new within the CSA have proved to be such a problem, what consideration has the Minister given to the framing of the clause to deal with the potential pitfalls in transferring functions from the CSA to the new body? In his report, Sir David Henshaw stated:

“I believe there are strong reasons to justify making a clean break from the current Agency and creating a new body with a  mandate to deliver a ‘fresh start’ for child support. This body should be separate from the task of dealing with legacy issues from the current system, including the management of existing debt.”

I am probing the Minister to go a little further on the matter. Perhaps he has not had an opportunity so far in the Committee to explain why the Government have chosen not to follow up that recommendation to keep the functions separate and to use the CSA to wind up historic debt and so on and to deal with other issues under the old system. That would allow CMEC to make a fresh start with future applications.

There is a question of the extent to which the creation of CMEC is delivering the clean break that Henshaw recommended and which the Committee wants to see. Two members of the Select Committee are here: the hon. Member for Weston-super-Mare and the hon. Member for North-East Derbyshire. Although one must remain silent, we hope to hear from the other in our debates. As they will remember, in its evidence to the Committee, One Parent Families stated that

“it would appear that the CSA (its staff and computer system) will simply be re-branded as C-MEC from 2008 onwards.”

Natascha Engel (North-East Derbyshire) (Lab) indicated dissent.

Danny Alexander (Shadow Secretary of State for Work and Pensions, Work & Pensions; Inverness, Nairn, Badenoch & Strathspey, Liberal Democrat)

The hon. Lady shakes her head: I am sorry that we shall not be hearing from her any more.

The question is that if the previous functions under the 1991 Act are to be transferred nem. con., with the exceptions of the six listed items in subsection (2), to what extent is the measure really a clean break? That is open to question. I invite the Minister to explain how he sees the issue. The Select Committee also expressed concern that CMEC will run three different systems in parallel for a time. Again, that seems not to represent the clean break proposed by Henshaw.

In that context, it is worth referring briefly to the issue of public confusion and misunderstanding about what is happening. CMEC will take over roles from the previous system. There has been talk in the press of the abolition of the CSA and a clean break, which has rightly reflected the Government’s own line on the matter, but it has given rise to a great deal of confusion in the general public and among the base of people who make use of the CSA and who may in future make use of CMEC.

Simply lumping everything in with the new agency is perhaps not the best way to make things clear. I hope, therefore, that as well as the points that the Minister will undoubtedly wish to make, he will also respond to the important issues of the public’s understanding of what is going on and whether the Bill really is the fundamental change that my party wishes to see.

Mark Harper (Shadow Minister, Work & Pensions; Forest of Dean, Conservative)

I have a couple of brief points to make. On the point that the hon. Gentleman has just raised, when reviewing Sir David Henshaw’s report I looked at some of the work on transition between organisations. I would appreciate it if the Minister outlined the thinking within the Department about how the transition from  the existing organisation to the new one might be managed. Many hon. Members, including the Minister and his colleagues, talk about a clean break. Sir David’s report said that there are a number of successful business models in the private sector for making a success of a clean break and on how to deal with a new business, a new model and the old arrangements. A key lesson from successful operations of that type was that the two different activities require different skills, organisational cultures and performance management.

As the hon. Member for Inverness, Nairn, Badenoch and Strathspey said, we have not heard a great deal about how transferring all of the functions and all of the people, as proposed by the next clause, will create a new organisation with a new mindset, a new culture, and—most importantly for the outside world—a new image. By that I do not mean just a new brand or identity, but a difference in performance that people can see as a real change. Persuading people that there has been a real change and a break with the past when they see effectively the same processes, the same people and very little difference, is going to be quite difficult.

It will be encouraging for the Committee if the Minister outlines some of the thinking in the Department because the commission will have to hit the ground running. If that culture change does not succeed right at the beginning, I am afraid that it will be too late. If the new organisation starts working without successfully doing that, it will not be possible to do it later. Will the Minister run through that for the benefit of the Committee?

James Plaskitt (Parliamentary Under-Secretary, Department for Work and Pensions; Warwick & Leamington, Labour)

I shall begin with the points raised by the hon. Member for Forest of Dean and work back to the others. In a sense, there are real problems with what he is asking. On the one hand he wants to ensure a clean break and is raising questions about whether that can be achieved by transferring functions. The implication, as I hear it, is that he wants to achieve a clean break by completely bringing all the functions of the CSA to a full stop somehow, as if it were possible to switch off one system, pack it up, put it away and then switch on another one and start again with something new. With respect to him, that cannot be done because there are at least 650,000 children involved for whom the most critical thing is that we ensure an uninterrupted and steady flow of maintenance. It is therefore extremely important to have as smooth as possible a glide path, if I might use the phrase again, from the existing cases within the agency into the new commission. Let me put it this way: despite all the problems that we are familiar with in the context of the agency, I would hope that those parents for whom the system currently works—and there are many for whom it does work—will not notice the difference. It is important that smoothly running flows of child maintenance should continue. For that reason, it is not possible simply to switch off one agency and start another. The carry-over from one to the other is critical.

Mark Harper (Shadow Minister, Work & Pensions; Forest of Dean, Conservative)

For the avoidance of doubt, I was not suggesting that. That is not what is happening; the commission is going to pick up the responsibility for those cases that do work. However, given that we know that the CSA has not been the most successful of organisations, how can we be sure that we are going to get a successful commission that works across the piece  both for its new customers and for those who have not been very well treated, as well as for collecting the historical debt?

James Plaskitt (Parliamentary Under-Secretary, Department for Work and Pensions; Warwick & Leamington, Labour)

Remember that it will not happen all in one big bang. As we set out in the White Paper, it will take a number of years to achieve the transition from the state that things are in now to the state in which the commission is fully up and running and is responsible for every aspect of child maintenance. It will be about 2013 before that happens, and we will apply the lessons learned from the CSA about the importance of taking time to get a complex transition such as this right. I hope that that reassures the hon. Gentleman.

The hon. Member for Inverness, Nairn, Badenoch and Strathspey asked why we had not proceeded with David Henshaw’s recommendation to have, in effect, two bodies: a legacy body and a new commission. We thought carefully about that but did not accept it because we want to go down what we believe to be the more efficient route. It is our firm view that it is crucial to have a single controlling team overseeing all aspects of the legacy cases as well as the new ones. The process needs to be as seamless as possible for all the clients who are involved in it. I am sure that if we were to move to a two-body situation, that would add confusion for clients. In dealing with matters relating to their family, they might find themselves working with one organisation handling legacy cases while also having to have a relationship with another body dealing with subsequent cases. There are many complex cases, and that would not be a satisfactory state of affairs. For those reasons, it was much more sensible to go for a single body overseeing all the legacy work as well as the new cases.

Michael Weir (Spokesperson (Energy; Work and Pensions; Trade & Industry); Angus, Scottish National Party)

I understand the Minister’s position. However, given that at least two systems run side by side in the CSA, the unfairness felt by many parents will be made worse by the fact that there will be a third system in CMEC, that one organisation will be running all three, and that it will be several years before all cases get on to the new system. The public perception is that it is a new organisation with a new system. Many of us fear that the fact that there are three different systems will undermine that perception and might institutionalise in CMEC the problems that exist in the CSA.

James Plaskitt (Parliamentary Under-Secretary, Department for Work and Pensions; Warwick & Leamington, Labour)

I do not share that concern. There is a difference between a transition between institutions—such as moving from the agency to CMEC—which is what we are talking about, and a transition between formulae, which is what happened within the agency after the 2003 change. Those are not the same thing. In fact, the formula change that came in as a result of the Child Support, Pensions and Social Security Act 2000 has been widely accepted and is supported as being a clearer way of arriving at maintenance assessments than was the previous model.

Tim Boswell (Daventry, Conservative)

Does the Minister agree that it will be important to give consideration to the right kind of communication to service users? It would be possible to drown them with too much information, or the wrong kind, or to stir up or alarm them unnecessarily about  destabilising changes in the arrangements. He wants a seamless transition of institutions, which is sensible, but at the same time there will be words on the street and people will jump to conclusions. Will he think long and hard, in conjunction with the new management, to ensure that this is got right and explained both passively, on websites and so forth, and by active communication as well?

James Plaskitt (Parliamentary Under-Secretary, Department for Work and Pensions; Warwick & Leamington, Labour)

Yes, it has to be seamless for clients. That is the bottom line. We are trying to ensure that we are providing the best possible level of service to clients. The smooth transition from one service to the other is of critical importance and will, of course, inform us as we think about how we deal with the detail of the switch, over time, from agency to commission.

Danny Alexander (Shadow Secretary of State for Work and Pensions, Work & Pensions; Inverness, Nairn, Badenoch & Strathspey, Liberal Democrat)

Hearing the Minister’s response to the intervention from the hon. Member for Angus led me to feel rather sorry for the staff of the CSA, about whom we will talk more under clause 13. However, it is appropriate to mention that, because we have already debated how staff numbers are dwindling. The Minister has answered that point—not to my satisfaction—but it now seems, from the way he did so, that staff in the same teams will, potentially, be dealing with three different systems for a while and there will still be a limited number of staff. That is a critical issue. What are the Minister’s intentions in terms of staff training, so that people can manage the substantially increased work that it sounds as though they will have? If necessary, is he prepared to make the resources available, so that the commission can employ the additional people that may be necessary to handle this transfer of functions?

James Plaskitt (Parliamentary Under-Secretary, Department for Work and Pensions; Warwick & Leamington, Labour)

The hon. Gentleman is taking me into the next debate. Suffice it to say it will be for the commission to devise the necessary transitional arrangements and for it, as I have said to him before, to determine the appropriate staffing level. There will be a constant dialogue on the resources between the commission’s senior officials and my Department. I think that his points are covered, but I will have more to say about staffing when we get to clause 13.

We are currently dealing with clause 12, which is a key element of the Bill and transfers to the commission those functions that the CSA currently carries out on behalf of the Secretary of State. For example, from the day appointed for the transfer, the commission will have responsibility for functions relating to the assessment, collection and enforcement of maintenance and to the duty to have regard to the welfare of the child. To be precise, the clause transfers the statutory child support functions as amended by the Bill. The transfer of staff and of property, rights and liabilities are provided for in subsequent clauses. The clause also gives effect to schedules 2 and 3. A few functions are excepted from transfer, as set out in subsection (2): some are retained solely by the Secretary of State, while others are both retained and transferred to the commission. I would like to mention each of those briefly and explain why they are excepted.

The right of appeal will be both conferred on the commission and retained by the Secretary of State. Although the commission will be a non-departmental public body, the policy that it operates is still ultimately the responsibility of the Secretary of State. It is  therefore essential that the Secretary of State is still party to the proceedings for any appeal to the child support commissioner or a higher court, so that he can challenge legal interpretations that might undermine the policy.

Functions under section 46 of the 1991 Act relate to decisions on the amount of benefit a person is to receive. They do not relate to child support, and are therefore not transferred to the commission. The power to authorise a responsible person for the disclosure of information will be both conferred on the commission and retained by the Secretary of State. It is important that the Secretary of State retains that function, as he will continue to have some child support functions, such as making legislation, and his work may involve handling information. However, it will also be necessary for the function to be exercised by the commission, and paragraph 16 of schedule 7 makes the necessary amendment to ensure that that is so.

Legislative functions—that is, commencement powers, powers to make consequential amendments and the power to make secondary legislation under the 1991 Act—will also remain solely with the Secretary of State, because it is he or she who is ultimately responsible for legislation.

Finally, the provisions of the 1991 Act which provide for the Secretary of State for Scotland to pay travel expenses for a person attending proceedings before a child support commissioner in Scotland, will remain with that Secretary of State and will not be transferred.

Establishing the Child Maintenance and Enforcement Commission is a key part of creating the new and radically different child maintenance system that we seek. Transferring the revised child support functions and duties to the commission simply allows us to establish it as a new independent body, specifically empowered and focused on promoting parental responsibility and choice and maximising maintenance arrangements.