The History of the CSA

In the late 1980’s, the increasing cost on the Treasury of benefits paid to lone parent families was brought to the attention of the then Prime Minister Margaret Thatcher by an MP.

This proved to be the beginnings of a scheme that started out with the best of intentions, but very quickly became little more than a mechanism for reimbursing the Treasury and in so doing creating financial hardship for thousands of families.

Government had two stated aims—to reduce child poverty and to make non resident parents responsible for the financial upkeep of their children, thereby relieving the taxpayer of that burden. Ministers initially supported the proposed legislation and its approach. However, despite being advised against doing so, the focus of the child support scheme was on recovering monies for the Treasury rather than on the welfare of the child and the legislation was written to reflect this. Parents with care were to see no financial gain in co-operating with the scheme, and non resident parents objecting because the legislation was made in retrospect, which overturned previous divorce settlements. Such settlements were disregarded and the non resident parent was made to pay all over again.

The Child Support Act 1991 was passed to give the necessary powers for a system to collect child support. Within 2 years of the Child Support Act being passed, the CHILD SUPPORT AGENCY was born and became the vehicle by which this Act was to be executed. The system they introduced was extremely complex and, as it turned out, directly conflicted with the aim to reduce child poverty. The agency was manned by inexperienced staff using an IT system that was hopelessly inadequate for the workload placed upon it.

Dogged by error and conflicting aims, the agency was a failure, with inefficient administration and problems caused by the IT system being evident from the outset. What MPs and Ministers had feared had come to pass.

Ill trained staff was subjected to increasing pressure to meet unrealistic targets, and as the volume of work increased, it led to a high absence rate and low morale. Before long, the agency received an instruction to “maximise the maintenance yield”. Staff reacted to this by targeting those non resident parents who were more likely to pay maintenance than those who would require time and resources to pursue. And so the ‘brown envelope’ culture was formed. The parent with care, who had previously struggled to secure maintenance and had turned to the CSA as their saviour to retrieve money from the non resident parent, soon realised this was not going to happen. Non resident parents who had private arrangements in place were told these arrangements were no longer valid and payments were to commence as instructed by the formula laid down in law. The system quickly became the target of fierce opposition and parents took to the streets in protest. Finally, Government began to realise the truth of the concerns previously raised by Ministers.

A New Beginning:
Public resistance and high levels of criticism lead to the new Labour Government introducing a simplified system in March 2003 (CS2). This system was to use a new, simplified formula to calculate the liability for maintenance based on percentages and this, together with a new £450 million computer, was meant to be the saving of the CSA. The vision was never realised. The reality was that parents with care with errant ex partners continued to struggle to secure regular maintenance, despite the CSA’s new campaign to target non paying parents. Non-resident parents who had no intention of paying up were, once again, able to slip easily through the net.

A New, New Beginning:
After 13 years of more errors, criticism, and millions of pounds of taxpayer’s money wasted, Sir David Henshaw was asked by the Secretary of State for Work and Pensions to produce a redesigned child support system. A damning report, written by Sir David in July 2006, recommended the Child Support Agency as it stood should cease to exist and a ‘radical’ new system put in place. The report focused on the welfare of the child and to reduce child poverty, which the CS Act had painfully failed to achieve. Government took on board these recommendations and responded with their proposal for the Child Maintenance and Enforcement Commission (CMEC). This commission will work at ‘arms length’ from the Government and will primarily encourage parents to make their own arrangements for child support.

Whilst there are some measures within the proposals for CMEC to be welcomed, overall they amount to nothing more than a re-hash of the old system, despite the ‘radical new approach hyped by the Secretary of State for Work and Pensions in his announcement. Some of the new powers of enforcement to be given to the commission will have far-reaching effects.
Many of NACSA’s members have given their views on some of these proposals and NACSA does not believe that CMEC will address the concerns and problems voiced by them. Today’s changing family structures demand a more pragmatic approach to child support and will continue to lobby government and ministers in an effort to get a fair and acceptable system of child support established.

The Key elements of CMEC include:
• Remove the compulsory element for parents with care claiming a prescribed benefit to use CSA services for child support arrangements. Parents with care will be free to make private arrangements with the non resident parent and will no longer suffer a reduction in benefit.
• Oversee an administration process in which parents can register their own private arrangements for child support.
• Provide extensive information, guidance and support to parents to fully inform them of the options available to them.
• Increase the maintenance disregard. Currently parents with care (on the new rules system) receive the first £10 of any maintenance paid. Legislation will extend these rules to encompass old rules PWCs to benefit from the £10 disregard. By 2011 this disregard is proposed to be substantially increased.
• CMEC will operate on the percentage based scheme as seen in CS2 rules but income of the NRP will be taken from the latest available tax information.
• Child maintenance will be calculated on the gross income of the NRP.
• Percentage rates will be set at 12% for one child 16% for two children and 19% for three or more children.
• Increase the capping of income from £2000 pw to £3000 pw
• One year fixed term payment schedules will be imposed, with variations to maintenance payable allowed only if a minimum 25% change of income is reported.
• Increase current flat rate amounts from £5 pw to £7 pw
• Using Deduction from Earnings Orders as a first method of collecting maintenance payments. This will allow CMEC to take the maintenance directly from the wages of the non resident parent.
• Remove the need to take non resident parents to court before pursuing a debt. Currently a liability order has to be granted by the courts before recovery action can be taken. CMEC will introduce an administrative process to replace the court based liability order process.
• Extend avenues available to secure information on non resident parents.
• Outsource debt collection to Debt Collection Agencies who will have extended powers of entry.

Other proposals under consideration are:
• Introduce powers to confiscate passports, driving licences, introduce curfews, and tagging of non paying non resident parents.
• Introduce a “name and shame” program, making public the details of non resident parents who have failed to pay maintenance. Further consultation is in place for this particular proposal.
• Introduce a charging regime for the use of CMEC services.
• Shared care arrangements to remain as that in CS2, but with the provision to allow an interim decision on presumed shared care arrangements until the matter has been confirmed.
• Consideration and further consultation is being given to make joint birth registration compulsory.

These proposals are currently working their way through the parliamentary process, with an expected date of introduction as 2011-2013. Some of the proposals are not yet defined, others may be altered as they work through parliamentary debate. If you have any concerns about the CMEC proposals now is the time to raise them. It is imperative that you write to your MP to express your views before the proposals become law.

NACSA gave evidence to the Dept. Works and Pensions Select Committee in January 2007 in which we expressed our concerns over some of the CMEC proposals. We also provided a written submission to the consultation process. You can read our submission here.

Dept from Works and Pensions makes 35 recommendations to ensure CMEC operates effectively. Read the recommendations here.

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