The story of Britain’s child maintenance system Before the creation of the administrative child maintenance system, many
non-resident parents evaded financial responsibility for their children altogether, as many parents with care did not pursue their former partners through the courts, often leaving it to the taxpayer to step in to support
children through the benefits system.
The Government created the Child Support Agency (CSA) in 1993 to act as an alternative to pursuing child maintenance through the courts. The main benefit of this administrative system was that it compelled non-resident parents who might otherwise have evaded financial responsibility for their children to meet their child maintenance responsibilities.
The CSA extended access to child maintenance to less well-off people who may not have otherwise had any child maintenance arrangements in place, and did so at a lower cost to the taxpayer than funding both parents through the court system. However, the costs of providing an administrative child support system have nonetheless been significant.
Initially, where the parent with care was on benefits, any maintenance recovered from the non-resident parent was used to offset the cost
of the benefits that the parent with care was receiving. In 2007/08, the Department for Work and Pensions recovered over £105 million in
this way against the CSA’s running costs that year of £563 million.
In 2003 a revised statutory scheme, together with new administrative
systems, was introduced. This was dogged by serious IT problems and the planned closure of the original scheme never took place. It became clear
that more fundamental reform was needed.
In 2006, Sir David Henshaw published his independent report, Recovering child support: routes to responsibility, on how the child support system
might be redesigned. One of the report’s recommendations was that
child maintenance payments should be disregarded in calculating benefit entitlement in order to encourage both parents to co-operate and increase
the amount of maintenance flowing to children.
A complementary recommendation was that, to encourage parents to
make their own arrangements, charges for using the administrative
service should be introduced. This would also discourage parents
whose circumstances are better suited to the legal route from using
the administrative service.
In April 2010, the Government delivered on the first of these recommendations, allowing parents with care to keep all the child maintenance payable without any effect on benefit entitlement. The Government introduced new legislation to allow it to charge for services
in the Child Maintenance and Other Payments Act 2008.
The Government subsequently spent £428million on administering
child support throughout its statutory schemes in 2011/12, without
recouping anything from the £1,186 million in maintenance arranged or collected that year.
This is on top of the near £6 billion in income-related support that the Government spent on single parents in 2011/12, support that includes
Housing Benefit, Council Tax Benefit, Income Support, and In-Work Credit.
Operationally, the current statutory scheme has been plagued by well-documented IT failures. As of March 2012, these failures have resulted in 104,100 cases having to be managed off the main computer systems at significantly greater cost than those cases managed on-system. Inefficient systems mean that it can sometimes take up to six months to process
an application, which then leads to a build up of arrears even before the
non-resident parent has been informed of the amount they must pay
in regular maintenance.
Because the proposals in the 2008 Act were not fully implemented, it remains the case that, as Henshaw noted, the current system provides no incentive for parents to collaborate in their children’s best interests. The recalcitrant non-resident parent can sit back and wait to be pursued for money, delaying support for their children and incurring cost to the state.
Similarly, the current system gives the parent with care no incentive or encouragement to make a family-based arrangement outside of the state service. Child maintenance must cease to be a weapon of control or revenge among former partners.
The result of all of this is a system where only half of all children in separated families benefit from effective child maintenance arrangements.
As the Government’s Social Justice Strategy reports, children who
receive support from both parents throughout their childhood tend to enjoy better outcomes in later life. Parental relationship breakdown often has an adverse effect on children, although the majority are able to adjust after a period of instability.
If we can help to ensure that both parents play a role in the upbringing of their children, taking joint responsibility, then we can alleviate the often debilitating after-effects of coping with parental relationship breakdown, including anxiety and depression, increased aggression, hostility and
The reform programme, outlined in some detail in this paper, seeks to preserve what is best about the administrative system, i.e. the extended
reach of child maintenance arrangements to a wider range of people,
while also addressing its policy, operational, and IT failings.
The improvements to support services and the introduction of the Gateway
will ensure that the appropriate support required to make family-based arrangements is available. The introduction of charging will contribute
towards meeting the dual aims of incentivising collaboration to achieve
family-based arrangements, and reducing the net cost to the taxpayer of providing a statutory system for parents who, despite our best efforts,
need to rely on the backstop of the state system.
The reform programme aligns closely with two of the main recommendations of the Henshaw report: encouraging co-operation between parents through support and financial incentives; and the maximisation of maintenance flowing to children.