This statement summarises the changes the Government intend to make in response to the consultation. We will publish a full response later this year.
As previously outlined, once the 2012 scheme has been opened to all applicants and has been shown to be working well, the Government intend to begin a gradual process of ending liabilities on cases in the previous Child Support Agency schemes. Parents in these “CSA” schemes will be invited to consider making their own family-based arrangements for maintenance or to apply to the new child maintenance service, which operates the 2012 scheme.
The Government will also begin charging application, collection and enforcement fees in the 2012 scheme. We have listened to concerns that the proposed 7% parent with care collection fee is too high a figure and therefore we will be reducing the proposed fee to 4%. The proposed fee for non-resident parents will remain at 20% calculated on top of the maintenance calculation.
In addition, we will extend the list of organisations to which an incident of domestic violence and abuse may be reported in order to qualify for the exemption from the application fee to include local authorities, legal professionals and specialist support organisations.
Separately, we have reconsidered our position on the flat rate of maintenance and have decided to set the 2012 scheme flat rate at £7 rather than £10 as previously proposed.
We intend to carefully manage the process of ending liabilities on cases in the CSA schemes so as to minimise the risk of disruption to child maintenance, particularly where maintenance is flowing as a result of enforcement action, such as deduction from earnings orders. We aim to do this in different ways.
First, we will change the proposed order in which liability is ended on CSA cases, starting with those CSA cases where a nil liability has been calculated, and therefore there is no possibility of payment disruption. We expect around 50,000 previously nil-assessed cases to be positively assessed in the 2012 scheme, resulting in maintenance flowing to these children for the first time; we will then end liability on cases that are not currently compliant, again because there is no current payment arrangement to disrupt; followed by any cases that are compliant but not subject to enforcement action, starting with those cases managed clerically. Finally, we will end liability on CSA cases that are in legal enforcement—and where money is flowing—or where money is only flowing as a result of an enforced method of payment. We anticipate this process of ending liability in CSA scheme cases to take approximately three years from start to finish.
Children living in lone parent families tend to be at greater risk of falling below low-income thresholds. By prioritising those cases where no maintenance is flowing, we aim to maximise the contribution of the statutory scheme to the welfare of these children.
Second, we will take a firmer line on which non-resident parents will be given the choice of paying the parent with care directly. We will offer a “compliance opportunity” to those non-resident parents who are subject to enforced methods of payment, such as deduction from earnings orders. We will write to non-resident parents nine months before their CSA maintenance liabilities are due to end, offering them the opportunity to prove their compliance voluntarily by paying via an unenforced method of payment such as direct debit for the final six months of their CSA liability.
Those non-resident parents who accept the invitation and then comply would have access to the “direct pay” option and thereby avoid the collection fee. Non-resident parents who refuse or fail this invitation will, if a case is opened on the 2012 scheme, be placed on the same enforcement method that they were subject to in the CSA schemes, thereby minimising the potential for payment disruption.
Finally, although this statement concerns changes to the statutory scheme, our reforms go wider than this. Our starting point is that children tend to do better when they have a positive relationship with both parents, so we are supporting both parents to play an active and positive role in the life of their child through the help and support for separated families (HSSF) programme. As part of this, we have launched the sorting out separation web app; an HSSF mark; the HSSF telephony network; and an innovation fund to test and evaluate new interventions to help separated parents work together.
Taken overall, these reforms are an important part of the Government’s wider social justice strategy, strengthening the support we provide to families and promoting the welfare of their children.