Child Support Agency

– in the House of Commons at 6:50 pm on 15th June 2004.

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Motion made, and Question proposed, That this House do now adjourn.—[Jim Fitzpatrick.]

Photo of Eric Joyce Eric Joyce PPS (Mr Mike O'Brien, Minister of State), Foreign & Commonwealth Office, PPS (Mr Mike O'Brien, Minister of State), Department of Trade and Industry 7:15 pm, 15th June 2004

I am aware that we are holding the second debate on the subject today and that my hon. Friend the Under-Secretary has had the joy of dealing with a long Adjournment debate about it this afternoon. Sadly, I was unable to attend and I therefore apologise in advance if I cover some of the same points that were raised in the longer debate in Westminster Hall.

The Department for Work and Pensions employs around 1,500 workers at the Child Support Agency office at Callendar business park in the centre of my constituency. The office deals with all CSA cases in Scotland and the north of England. In addition, the Department employs another 300 or more workers in jobcentres and other offices across the Falkirk and Stirling areas. Some of the workers in Stirling, in the constituency of my hon. Friend the Under-Secretary of State for Scotland, Mrs. McGuire, also work for the CSA and serve my constituency as well as hers and other parts of central Scotland.

I would like to raise the subject of staffing levels at the CSA in Falkirk, about which there is considerable concern locally. The issue has been raised with the Under-Secretary by several trade unions, including by the general secretary of the Scottish Trades Union Congress. I hope that my hon. Friend can give some indication of what will happen in the near and middle-distance future.

Before I go into detail about figures, I want to say a few things about the importance of this strategic Department for Work and Pensions asset—the CSA—to my constituency and the surrounding areas, and, of course, to everyone in Scotland and the north of England who is affected by the CSA's work.

The role of the CSA is perhaps best laid out for members of the public in the helpful question and answer section on the CSA website. It explains the services provided by the CSA in an easily understandable format, describes some of the technical terms and, importantly, provides the public and potential clients with an understanding of the intent and underlying objectives of the agency. The website sets out how calculations are currently made, essentially applying three rates of 15 per cent., 20 per cent. and 25 per cent. of a net weekly income of more than £200 of the non-resident parent's income, depending on the number of children involved.

The website is helpful and clear and provides good case examples. In any one week, doubtless in common with all Members of Parliament, I receive several new contacts from clients of the CSA or people who are not clients but who seek advice on whether to approach the agency.

In my experience, clients of the CSA fall into three groups. First, there are those, mainly but not exclusively men, who are required to pay a given amount, calculated by the CSA, to their former partners to help with the upkeep of their children until the children are 18. Secondly, there are those, mainly but not exclusively women, who receive such payments. Constituents are often accompanied by new partners and perhaps new dependants. That illustrates the potential complexity of the chains created by people moving naturally into new relationships when earlier ones have come to an end. The relationships can be complex. Members of the first group have come to see me, bringing their new partners, and it has become clear to me that the new partners belong in the second group but were perhaps not aware of that. I have suggested that they approach the agency.

In general, people in the first group—mainly men and their new families—contact me because they feel that the level of payment that they are required to make is too high, that there have been historical errors in their case or that certain factors are not being properly taken into account by the CSA. Those in the second group contact me because they feel that they are not receiving enough money, that there is an historical debt, or that some factors are not properly being taken into account.

For about a year, a growing number of people have begun to form a third group. It comprises those in the first group who accept—albeit sometimes reluctantly—that they are paying the right amount under the old system, but believe, sometimes incorrectly, that they would be paying less under the new one. This group—which is technically a sub-group, I suppose—relates to the nub of the staffing issue that I want to raise tonight. I shall expand on that in a moment, but first I want to give the Minister the impression of the CSA that I have gained through my experience over the last two or three years. I say "two or three years" because I know that the situation was considerably more complex and difficult before I arrived in the House, and I understand from my more senior colleagues that things are much better now than they were heretofore.

It is patently clear to me that the staff at the CSA are highly professional, extremely courteous and fully aware that they are dealing with people at a very difficult time in their lives. They are also aware, however, that from time to time clients may be less than accurate in their dealings with them, and also that the well-being of the children who should be in receipt of funds in such cases sometimes depends on the tenacity of CSA staff.

As the Minister knows, virtually all clients of the CSA have most, if not all, of their contact with the agency by telephone. I have toured the facility, which resembles—indeed, in some ways, is—a large call centre. That is potentially a highly efficient model and my constituents report that, on the whole, the agency has slickly designed systems for dealing with people on matters of detail and fact. To be fair, they also report that, owing to what appears to be a high staff turnover—I have no details of how high it actually is—they sometimes have to go through the same loop on the telephone several times. That can be frustrating for constituents who feel that their lives are on hold until their cases have been sorted out. Perceptions are important in this regard. If people feel that they are not being treated sensitively at such a difficult time, they can become upset. That in turn is reflected back on the CSA workers, whose jobs can therefore be stressful, thus adding to what I understand anecdotally to be a modestly high staff turnover.

The caseworkers at the CSA are not highly paid, yet, as I have witnessed, they are most certainly committed and professional. Errors are sometimes made, of course, and miscommunications can happen on that imperfect medium, the telephone. It can sometimes be difficult to clear up difficulties on the phone, and it is often when clients have reached the end of their tether that they come to me for assistance and advice.

The CSA has an excellent parliamentary unit that accepts and deals speedily with inquiries from MPs on behalf of their constituents. It is often useful to arrange a face-to-face meeting between a constituent and a senior caseworker in my office. I have found those face-to-face meetings a revelation, in that the officer who attends the meeting, knowing that they may be about to meet an unhappy client—or an unhappy client plus family—without fail arrives with an impressive command of the facts of the case and armed with an exemplary direct but diplomatic manner.

I am not sure why, but Ms Cath McLaughlin is more often than not the officer who attends those meetings and she has my gratitude, and that of many of my constituents. She is one of the most impressive public servants whom I have met in my constituency in my time as a Member of Parliament. I was chatting to my hon. Friend Mr. Dalyell, whose constituency borders mine, just before this debate and he has precisely the same impression of the agency and its officers as I do.

I find that while constituents may not always walk away from the face-to-face meeting ecstatic, they virtually always leave with greater understanding, and more often than not, with the satisfaction of having had their concerns taken seriously and sympathetically, with a human face rather than a voice at the end of a telephone. I appreciate that in most cases the telephone system works, and that human contact is labour-intensive, but that personal service epitomises the human face of an organisation that provides an enormously valuable service to society at large.

I mentioned the third sub-group of CSA clients earlier. All essentially have the same complaint. The details at the website questions and answers section that I mentioned earlier pertain only to new claimants and those who have been in the system since the rules changed in April last year. Those who were in the system prior to that are still dealt with under the old rules, which are more opaque and complex, and more specific in many ways. The challenge of making things simpler is that they will be less specific for specific cases. The new system seems unquestionably a marked improvement, but as the Minister knows, the migration of old clients to the new system is behind schedule, owing to difficulties with putting the new system in place.

The complaint of the third group of people is that they know of others who are in exactly their circumstances but who pay a very different amount owing to having come into the system since changeover and therefore being considered under the new rules. Owing to the simplicity of the new rules, such people are often, in my view, likely to be correct, because the calculation can be done as a percentage of their income. I accept, of course, that there will be those who know that they would be paying more under the new rules and who are therefore less likely to seek my assistance. It is not ideal that two systems should be operating at the same time for far longer than Ministers anticipated originally. It is important to recognise, however, that that is essentially the fault of the contractor, as I understand it, and that a penalty element is now built into the contract, which will apply until the Department is satisfied that the situation has been properly rectified.

Crucially, it seems to me and many of my parliamentary colleagues that the assumptions made by staffing planners projecting likely efficiencies, which arise as a result of the computing system, may well not be valid. That is the nub of my speech tonight. Of course, organisations must make themselves as efficient as possible and have a duty to do so. In this case, however, possibly significant staff reductions are juxtaposed with what seems to be a systemic problem, which is of particular note.

At this point, it is important to mention the political and managerial assumptions and imperatives behind the new system at the CSA. Those are politically relevant and relevant to the contact that I have with trade unions and constituents. The Government's goal is to deliver world-class public services through sustained investment and outcome-focused reforms to ensure that taxpayers receive the value for money that they expect and to which they are entitled. That means that the Government are committed to placing public sector efficiency and effectiveness at the top of the agenda. The Government's 2004 Budget set a target of a 2.5 per cent. reduction in public administration costs each year over the three years of the 2004 spending review. That will be in conjunction with a 2.5 per cent. per annum increase in current spending and a public sector net investment rise of GDP to 2.25 per cent. by 2007–08 to address the historic under-investment in the UK's infrastructure while remaining consistent with the Treasury's sustainable investment rule.

The Treasury and the Government as a whole are committed to delivering high-quality public services and the Treasury website gives ready access to the public of a document with exactly that title, "Delivering high quality public services", which introduces the crucial Gershon report on efficiency in the public services. Paragraph 6.7 states:

"achieving greater efficiency in the public sector will enable the government to deliver high and continuously improving standards within the public service by releasing extra resources for front line services. This means moving resources, as a result of more efficient procurement and streamlined back-office functions"— such as those at the CSA in Falkirk—

"away from administration and closer to public service customers. The greater scale of the efficiencies that can be achieved within the public sector, the lower the increase in total expenditure that is required to achieve further improvements in the performance of key public services. Efficiency gains, therefore, also enable the Government to fulfil its responsibility to deliver value for money to taxpayers."

Paragraph 6.8 states that efficiency in the public sector involves making the best use of the significant investment in information and communications technology, which is precisely what is being put in place at the CSA. It also involves work-force reform and the sharing of best practice agreed for the spending review period. Other investments designed to modernise and enhance the delivery will build on that. The pursuit of efficiency also includes reducing bureaucracy, which both cuts headquarters administration costs—including those of organisations such as the CSA—and frees the time of front-line professionals so that they can respond better to the needs of their customers.

The Lyons review—a parallel process also aimed at achieving the best outcome for taxpayers and service users, and conducted for the Treasury by Sir Michael Lyons—is intended to enable Departments to lower costs and provide a benefit to regional economies by moving significant elements of large Departments located in London. As a central Scotland Member, I would naturally like my constituency to benefit from such movement. Who knows whether it will, but I suggest that the various large Departments consider relocating to Scotland.

The general Lyons principles seem to have considerable merit. Moreover, as a Labour MP, I am committed to the importance of bringing about ever-higher standards of social justice through continuous improvement of our vital public services.

The local branch chair of the Public and Commercial Services Union has given me some figures, in good faith, to which I should like the Minister to respond. They may well be accurate; who knows? I am sure that in any case the Minister has access to absolutely accurate figures. I am informed that the Department aims to reduce the local work force of 1,500 by around 30 per cent. over the coming three years. Naturally, local workers and the PCS fear that that will be done before the new system is fully embedded and cause greater stress among the workers who are left. It has also been suggested to me that the CSA centre in Falkirk could close altogether. It is said that the building has structural problems and may not stand up to the alterations required for modernisation. I would be grateful if the Minister could clarify the situation.

In summary, let me ask the Minister three questions. First, can he assure me that there will be no precipitate reduction in the work force at the CSA in Falkirk, certainly until the new system has been embedded in the CSA? Secondly, can he give me some assurance that there are no plans to close the Falkirk office in the near future? Thirdly, can he indicate the likely levels of change in staffing at Falkirk over the next year?

Photo of Mr Chris Pond Mr Chris Pond Parliamentary Under-Secretary, Department for Work and Pensions 7:32 pm, 15th June 2004

I congratulate my hon. Friend on securing a debate on a subject that is so important to the lives of his constituents—CSA staff, and the parents and children whom the agency exists to serve. I am delighted to be responding to my second Adjournment debate on the CSA in one day.

Let me begin by emphasising that my ministerial colleagues and I are committed to the improvement of public services across Government, and specifically to the aim of creating an efficient, effective child support service. Modernisation of public services is vital to ensuring that our constituents receive the services to which they are entitled, and that taxpayers' money is properly spent. As one of the largest Departments, the Department for Work and Pensions is significant in the drive for efficiency and quality, as is the CSA itself.

The child support reform programme aims to create a child support system that is simple, transparent and easy for parents to understand. As my hon. Friend knows, the new child support scheme was introduced in March 2003. A vital component of the reform programme is the new information technology system, which is essential to the delivery of the scheme.

In introducing such sweeping and major reform to an organisation, we have made it a priority to maintain a good level of service for clients and to ensure minimal disruption. We did not want to make the mistakes from which the agency suffered when it was set up in 1993, so we decided to introduce the new scheme for new clients only in the first instance. Only when we could be satisfied that the new scheme was working well, and were confident that the system could cope with the large number of cases—more than a million—that would have to be transferred, would we decide when old scheme cases would migrate and be converted. I believe that that incremental approach was the most sensible and appropriate, even though I understand the frustration of those who want to see the new, simpler and fairer system in place immediately.

Although in the majority of cases liabilities will change under the new scheme, new liabilities will in any case be phased in via a series of steps to allow parents to adjust to the financial changes. It is worth remembering that if one parent sees an advantage in moving to the new scheme, the other probably will not. We are keen that all clients should benefit from the new reforms, but it would be irresponsible to move old scheme cases to the new scheme until we are sure that the IT can cope properly.

Inevitably, as part of the efficiencies that modernisation brings, it was always planned that the number of staff would reduce as the reforms were implemented. The agency has been planning that for some time. I am sure that my hon. Friend is well aware of the unexpected difficulties that the agency has encountered with the new IT system, and I can confirm that payments have in fact been withheld from our IT contractor, EDSElectronic Data Systems—of between 15 and 20 per cent., to take account of that non-delivery. Those problems have impacted on some clients, and I want to take the opportunity, for the second time today, to apologise for that.

We must ensure that disruption for clients is kept to a minimum. Inevitably, some clients will have complained about the service that they have received, and the agency acknowledges that in some cases, the service that it has provided is not of an acceptable standard. I know that the agency places great emphasis on ensuring that complaints are properly dealt with, and during the past year it has improved the way in which it handles complaints, including accepting and registering complaints by telephone to make the process quicker and easier for clients. That has inevitably led to an increase in the overall number of complaints logged, although the number of complaints in relation to the old scheme has actually decreased.

It is not yet possible to set time scales for when all cases will be converted on to the new scheme, although I wish that I could do that. We will not do that until the IT system is working effectively—to do anything else would be irresponsible, and do a disservice to our clients and constituents. Where the new IT does work well, the feedback from staff and clients has been very positive: they say that the system is much quicker and simpler. Performance has improved and continues to do so, and there are plans for improving the system to prepare for the migration of old scheme cases.

The delays that the child support reform programme has encountered have meant that plans for staff reductions in the agency have been revised, but the fact remains that the new scheme will not only improve the quality of the service but release resources through greater efficiency and cost-effectiveness, as my hon. Friend acknowledged. The agency is currently undergoing a review of the business to ensure that the required reductions in the number of staff will not impact adversely on the service to clients, or prevent the successful implementation of the rest of the reform programme. That will ensure that greater efficiencies in working practices are identified and implemented.

Doing business by telephone and electronic means is, as my hon. Friend acknowledges, quicker and more efficient, and the agency is making great progress in developing the business in that way. However, I accept and appreciate my hon. Friend's comments on the importance of face-to-face contact between CSA staff and clients. I should like to take this opportunity to thank my hon. Friend for his generous comments about the professionalism and commitment of CSA staff, with which I fully agree, and particularly his comments about Cath McLaughlin and her colleagues.

Times of major change are understandably unsettling for some staff, and the agency is managing a number of support initiatives for managers and staff throughout the period. Consultation with the trade unions is, of course, ongoing. My hon. Friend asked for an assurance that there are currently no plans to reduce staffing levels in Falkirk, West by 500 staff, and I can give him that assurance. The current plan does include a reduction in staff of 94 by March 2005, a plan that has been discussed with the trade unions, which constitutes not a 30 per cent. but a 9 per cent. reduction in staff.

As part of the DWP, the agency will work with the other businesses to plan and manage reductions in staff in an integrated and joined-up way, in order to benefit the wider Department and the people whom we serve. The Department will manage these reductions through natural wastage, and I can confirm to my hon. Friend that staff turnover at the Falkirk centre is about 13 per cent., which is about average for the agency throughout the country as a whole. We will also seek to minimise compulsory severances. My hon. Friend also sought assurance that there are no plans to close the Falkirk centre, and again, I can give him that assurance. He will agree with me that the public deserve to receive quality services, and that taxpayers deserve to get value for money.

The vision for my Department is that it should become a leaner, more focused and efficient organisation, delivering first-class services to clients; the Child Support Agency inevitably has its part to play in this. Major reform is not simple or easy, but I have every confidence that, ultimately, the agency can deliver it successfully.

I would like to take this opportunity again to thank the agency staff in my hon. Friend's constituency and elsewhere. They work in difficult circumstances, dealing with clients at an often very emotional and sensitive time in their lives. It is because of the hard work of such staff that the implementation of the reforms will be successful, and that a reduction in staff numbers will not have an adverse impact. I should underline that where we have to make such reductions, we will do so whenever possible through turnover and voluntary severance.

The Government's aim remains to have an efficient and effective child support service that benefits parents and, ultimately, children. After all, they are our No. 1 concern.

Question put and agreed to.

Adjourned accordingly at nineteen minutes to Eight o'clock.