My Lords, I congratulate the noble Baroness, Lady Deech, on securing the Second Reading of her Bill. Indeed, I thank her for all the work she has done, and no doubt will continue to do, in this vital area. Although currently much maligned, it is a strength of your Lordships’ House that noble Lords such as the noble Baroness, Lady Deech, with a passion for and deep understanding of an issue, can work tirelessly with Governments of all persuasions to encourage reform. It has been my pleasure to listen to your Lordships today. I thank all noble Lords for the insight they have brought to the debate. I will encourage my colleagues in the MoJ to study them carefully.
The resolution of financial matters is one of the many challenges of divorce or civil partnership dissolution. Although there are differences of opinion within your Lordships’ House and beyond, it seems that there is an agreed and twofold objective: that the process should be as supportive and clear as possible, and that the outcome for both parties and any children involved should be fair.
From the debate it is very clear that there is consensus among your Lordships that reform of the law governing divorce finances is overdue, but it is also the case that consensus on the type of reform is not universal. The President of the Family Division, Sir James Munby, who, as the noble Baroness, Lady Deech, noted, favours reform, also recently observed that,
“views on what form such reform should take are sharply divided”.
It seems that this divide comes from the differences of opinion about how we should balance the law. We can all agree that the current legal framework gives the court wide-ranging flexibility in making financial orders and that judges skilfully exercise that flexibility and discretion every day. For those who see the virtue of the existing law, that flexibility allows for fairness. For those who see a problem with the law as it is, that same flexibility makes for uncertainty. For example, the noble and learned Baroness, Lady Hale, the President of the Supreme Court, has suggested that, sometimes, open-ended periodic payments are the only way to,
“give each party an equal start on the road to independent living”.
It is clear to me that the breadth of views, including from those at the very top of the legal profession, warrants careful consideration by the Government.
Rebalancing a law such as this—if we are satisfied that it needs rebalancing—cannot be an easy undertaking. The law—one law—must allow the court to deal equitably with the widest range of cases, from shorter marriages of young people, both with successful careers and great prospects, to longer marriages of older people where it was jointly decided that one of them should give up a career to build a home and raise children. Here I must note that, although there might be a perception that the law is out of step with how men and women live their lives today, the law is gender-neutral. Equality of spouses is in statute, so how does it get put into practice? One might conclude—indeed, some have alluded to this—that it is not the law that needs to change but the attitudes of some of those who apply it.
It is clear that the law must retain a measure of flexibility. The question before your Lordships’ House is how much flexibility is needed to allow the court to make orders that are fair to both parties in a very wide range of cases and circumstances. This must be balanced with the need to provide greater certainty about financial outcomes to inform and manage the expectations of the separating couple. The Government want to encourage couples to agree financial arrangements themselves where it is appropriate and safe for them to do so.
In 2014, the Law Commission noted criticism that the law on financial needs was not always consistently applied, but it concluded that the law on this did not need statutory reform. Instead, it recommended that the Family Justice Council prepare guidance on the meaning of “financial means”. The Government listened and took action. With government funding, the Family Justice Council produced detailed guidance for the judiciary and legal practitioners. The noble Baroness, Lady Deech, commented on the guidance’s complexity, but it is for those with the skills and experience to deal with complexity, not for the divorcing couple. It was only relatively recently that this work was completed—indeed, within the last few years. It is only right that we give it time to bed in. If, in due course, it is decided that it is not fulfilling its purpose, perhaps it will need to be reviewed.
There is good guidance for the divorcing couple—a topic mentioned by the noble Baroness, Lady Falkner. The Government produced an excellent guide for divorcing couples to help them agree their finances. The guide, Sorting Out Your Finances When You Get Divorced, is accessibly written, is just 50-odd pages long, is well presented and has been available since September 2015. It explains the options available and how the court makes decisions, so that divorcing couples can have a realistic perspective on their separate financial futures.