The Government has unveiled detailed plans for the new and radically reshaped child maintenance system in Great Britain. There will be extra help for separated parents who want to support their children and new penalties for those who won’t.
Ministers believe the current system, which costs £0.5bn a year, and focuses on purely collecting and transferring money has proved inefficient and has damaged separated families. The Government wants to reshape the system so it is focused on supporting families to make their own arrangements which are in the best interests of the children involved.
To do this, £20m is being invested to provide a network of support services, capable of reaching out to help separated families, wherever they are, whatever their background, online, on the phone, and in person.
DWP Minister Maria Miller said:
For too long we’ve had a child maintenance system in this country that fails children, parents and the taxpayer. Half of children living in separated families do not benefit from an effective child maintenance arrangement and there is little support for parents to work together and for reluctant parents to take their responsibilities seriously.
The new system will place a greater emphasis on supporting parents to make their own arrangements which are in the best interests of the children. We are investing in extra support services - including mediation and counselling - to make this happen.
The statutory scheme will still be heavily subsidised for those who are unable to come to their own arrangements, but the changes we are proposing will offer greater fairness to the taxpayer and a financial incentive for parents to work together.
The policy document; Supporting Separated Families; Securing Children’s Futures sets out key improvements including:
Coordinating existing services Better co-ordination of existing support services and to build an evidence base of ‘what works’ in helping parents to collaborate.
Telephone and online support Several existing helplines already do an excellent job in helping parents with separation. These organisations will deliver a new service that will help mothers and fathers to work together whenever possible. A specially developed web ‘app’ will provide online information and support.
Local support Funding for regional coordination and training to help join- up support services and the wider community on the ground. For example, health professionals would be able to signpost a parent to expert help with the financial issues surrounding separation.
An Innovation Fund for pioneering new services for separating parents was also announced in June.
The overall purpose is to help the experts in the field who work with families day-in and day-out, rather than creating more government bureaucracy. An expert steering group drawn from the voluntary sector, education and leading social media has advised the Government. Its members include Justine Roberts from the popular parenting website ‘Mumsnet’:
Parents on Mumsnet who are going through divorce and separation rarely find all the information and guidance they need in one go. Different advice is needed at different times so there’s a real value in having a wide variety of services. The innovation fund is also good because it can be used to test what works and what doesn’t before putting too much resource into any one model.
An extra layer of support to help parents make their own maintenance arrangements will also be provided by a gateway service; for the first time, all parents considering applying for child maintenance payments via the state will be invited to discuss their situation and consider possible alternatives. Where appropriate, it will signpost them to community-based support services.>
The new statutory maintenance scheme, to be known as the Child Maintenance Service, will take cases where parents cannot make their own arrangements. In order to motivate and create incentives for parental collaboration, a system of charging will apply.
It is proposed, as well as a £20 application fee, the parent paying maintenance will pay an additional collection fee of 20% on top of each assessed payment. The parent receiving maintenance will have 7% deducted from each assessed payment.
But parents who fail to pay will face additional penalty charges reflecting the cost of enforcement action. For example, it is proposed that a Liability Order from the courts will carry a £300 surcharge, while £200 will be charged if money has to be removed from their bank account via a lump sum Deduction Order.
Both parents will avoid collection fees if the paying parent opts to pay the other directly without use of the collection service. This is designed to build trust between separated couples.
The new Child Maintenance Service will continue to be heavily subsidised but will be faster and fairer, better for parents and taxpayer.
Payments will usually be based on the paying parent’s latest tax-year gross income, reported by HM Revenue & Customs. Use of tax data means assessments will depend less on what parents choose to disclose about their income.
Maintenance calculations will be reviewed annually to ensure they remain fair accurate and up to date.
The Child Support Agency currently costs almost £0.5 billion per annum on top of the £6bn the Government already pays out in income-related support for lone parents.
Notes to editors:
- For more information about the changes that are being made, please visit the DWP website dwp.gov.uk/consultations/2012/childrens-futures.shtml
- In January 2012 the Government announced investment of £20m over three years to support separated and separating families. The money will be dedicated to working with groups with expertise in helping parents on the range of issues that arise with separation - including child maintenance. It will streamline and bolster existing support. Up to £14m of it will form the ‘Innovation Fund; Support for Separating Families’ for new and innovative solutions such as intensive counselling and mediation.
- Parents who have been the victims of domestic violence and have reported it to a list of prescribed organisations will be exempt from the upfront application charge for the Child Maintenance Service. If parents nominate to use Direct Pay, then the other parent can pay them directly using a blind-payment facility which withholds the receiving parent’s bank account and contact details. This would mean both parents will also escape the ongoing collection fees.
- The Child Support Agency’s 1.1m current cases will be gradually closed, with liability to pay maintenance on those cases ending. The case closure process is expected to take around three years from 2014. Parents will then have the chance of a fresh start by arranging their own family-based arrangement - or applying to the new Child Maintenance Service.