Research and analysis

Introduction of single maintenance collection and transfer service in the Child Maintenance Service – impact on child poverty levels

Published 23 June 2025

Introduction

1. In June 2025, the government announced that, from 2027 to 2028, the Child Maintenance Service (CMS) would move to a single streamlined service where it can quickly identify, and tackle missed payments. This will replace the current service where the majority of parents are in Direct Pay and pay one another directly according to a maintenance schedule issued by the CMS, and only those who report and provide evidence of failures have money collected and transferred by the CMS in the Collect and Pay service. Full details of these changes can be found in the Child Maintenance: improving the collection and transfer of payments – Government Response to consultation publication.

2. This publication provides estimates of the impact of the policy change on the numbers of children in poverty.

Methodology

3. Streamlining the CMS into a single service aims to reduce child poverty by improving compliance as all payments will pass through the CMS to increase oversight. As payments will be monitored by the CMS in all cases, steps can be taken as soon as payment breaks down to re-establish compliance.

4. In the absence of detailed income and compliance data for matched receiving and paying parents in Direct Pay, we have taken a broad approach to the estimation using recent Family Resources Survey (FRS) and Households Below Average Income (HBAI) data, together with Child Maintenance Service Administrative data and DWP research with Direct Pay customers.

5. To estimate the impact of the policy change:

a. We used administrative data to estimate the average value of child maintenance paid through Direct Pay arrangements in the CMS by family size.

b. We then used FRS/HBAI data linked to CMS data for the three years from 2021 to 2022 to 2023 to 2024 to estimate the number of children in families with receiving parents who have Direct Pay arrangements and could move over each of the poverty lines if their equivalised household income increased by up to the relevant average liability for their family type.

c. This was offset by the number of children in families with paying parents who could move into poverty if they were to pay up to the average liability.

d. The resulting difference in children gaining and losing was adjusted to reflect estimated non-compliance levels in Direct Pay and expected compliance in the streamlined service.

6. As these estimates are based on survey data and assumptions, they are subject to sampling and non-sampling uncertainty^{[footnote 1]}.  An average of the impacts for each of the three financial years ending 2022 to 2024 is taken and estimates are rounded to the nearest 20,000, in line with the approach to poverty estimation in the Separated Families Statistics^{[footnote 2]}.

Poverty Impacts of the Policy Change

7. Averaged over the latest 3 years of HBAI data, it is estimated that had the policy applied in the relevant years, there could have been around 20,000 fewer children in relative poverty after housing costs, as a result of streamlining the Child Maintenance Service into a single collection and transfer service^{[footnote 3]}.

8. For all other measures of poverty for children, see table 1.

Table 1: Other measures of poverty for children

Estimated change in poverty levels, averaged over the financial years ending 2022 to 2024	Relative poverty AHC	Absolute poverty AHC	Relative poverty BHC	Absolute poverty BHC
Children (number)	20,000	<10,000	<10,000	<10,000

Notes to Table 1

1. Figures are rounded to nearest 20,000.

2. Estimates relate to Great Britain.

3. Internal of analysis of CMS Statistics, September 2023, showed an average Direct Pay liability of around £48 per week for one qualifying child, £68 per week for two qualifying children and £77 per week for three or more qualifying children and £58 overall in the middle of 2023/24, the latest year for which we have FRS and HBAI data and to which we have matched CMS data.

4. Assumed underpayments by up to the average liabilities for different numbers of qualifying children.

5. Assumed changes in household income were equivalised for household composition.

6. Assumed around 36% of the children in receiving or paying parent households with Direct Pay arrangements and household incomes near the poverty line stand to gain or lose respectively from improved compliance in the new service, as this is the proportion of receiving parents who reported in Direct Pay research usually getting less than the full amount of maintenance owed to them^{[footnote 4]}. Some will have been getting partial payments while others will have been getting nothing.

7. For simplicity, assumed there is one paying parent for every receiving parent when in reality there are slightly more paying parents for every receiving parent.

8. Assumed that 68% of those who are paying less than the full amount in Direct Pay will make some increase to the amount they pay, in line with Collect and Pay compliance^{[footnote 5]}.

Statement of application of the Code of Practice for Statistics

9. This analysis has been produced as far as possible in line with the Code of Practice for Statistics. The code is built around 3 main concepts, or pillars:

• trustworthiness – is about having confidence in the people and organisations that publish statistics
• quality – is about using data and methods that produce assured statistics
• value – is about publishing statistics that support society’s needs for information

The following explains how we have applied the pillars of the Code in a proportionate way.

Trustworthiness

10. DWP analysts work to a professional competency framework and Civil Service core values of integrity, honesty, objectivity, and impartiality. Analysts have produced these statistics and conducted rigorous quality assurance in line with the standards usually applied to ad hoc releases. Background and methodology information is also included in the release.

11. The analysis has been signed off by the expert lead analyst and the Department’s Head of Profession for Statistics was consulted on the production and publication process and the timing of the publication was pre-announced.

12. To support financial planning and management of departmental business, figures have been seen in advance by Ministers and officials.

Quality

13. The process to produce the analysis in this report was conducted by professional analysts taking account of the latest survey, administrative data and research and applying methods using their professional judgement. The analysis has been through a rigorous quality-assurance process and sign off by other DWP analysts.

Value

14. The publication of this ad hoc release ensures the statistics are equally available to all users as well as providing transparency and up to date data.

1. Read further information on uncertainty in the underlying survey data Separated families statistics: background information and methodology  ↩

2. As the average liability and poverty thresholds for each year are in 2023-24 prices, the average liability is not deflated for previous years. Differences between general inflation and the rate of change in Direct Pay liabilities could mean that comparisons for historical years are not entirely consistent, but the impacts are assumed to be small. ↩

3. Estimate is rounded to the nearest 20,000. ↩

4. Child Maintenance Service Direct Pay Research ↩

5. Child Maintenance Service statistics: data to December 2024 ↩