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Child Maintenance and Other Payments Bill

My Lords, while I am grateful to the Minister for introducing this Bill so clearly, as he always does, and for describing the changes that it is already planned to make to it, my immediate reaction is that it is mechanistic. The reason is simple. I am sure that we would all agree that the ideal place for children to be brought up is in a two-parent family—children and parents living together in the same house, which we call a nuclear family. There is, though, no encouragement in the Bill for a nuclear family to stay together, nor to maintain any relationship once it has split up. The Bill—at least the first three parts of it—is solely concerned with achieving a flow of money between separated parents to ensure that part of the earnings of the absent parent is donated for the support of his or, occasionally, her children who are living with his or her former partner. The Bill, like its predecessors, calls that person ““the parent with care””. The first three parts of the Bill might be better described as the Child Support Agency revamp Bill and in normal circumstances would warrant a Bill of their own. However, I fully understand why the Government have used this opportunity to tack on the somewhat disparate ““other payments””. So much legislation is emanating from other departments of state that, having got a legislative slot, the DWP must use the opportunity to the full—more of that anon. I return to the subject of the CSA’s reformation, which is the Bill’s primary objective; as the Minister said, isn’t it needed. The CSA has had an ignominious history. The House will remember that it was set up by the previous Conservative Government with all-party support. As I have said, and it remains as true today as it was in 1993, children should be supported by both parents. Even low-earning or benefit-recipient parents when absent should make a contribution to the upkeep of their children according to their means. This was assessed by a formula—changed to fairly popular acclaim in 1995 and 1996—which made it considerably more acceptable, particularly by reducing the maximum level of maintenance and so making it more affordable for absent parents. The Government inherited a system which was beginning to work well enough. The noble Baroness, Lady Hollis, to whom I pay tribute as one of the three Ministers in this Government who have struggled—I think that ““struggled”” is the appropriate word— with the CSA, said in May 1998 that: "““Around 80% of assessments for child maintenance are now correct to the last penny, and some 98% of maintenance is passed on to the parent with care within 10 working days””." However, the complicated formula that was used was leading to quite large debts. The Government, therefore, came up with a new one in 2001, which was amended several times due to a new computer system which finally went live in 2003. In passing, why is it that every time this Government commission a new computer system, it turns out to be disastrously late and over budget? The Minister will remember that I asked him the same thing the other day when we were discussing the annulment of the Social Security (National Insurance Credits) Amendment Regulations. I am grateful for the letter I received from the Minister last week which essentially validated my solution. Be that as it may, a Select Committee of another place described the CSA's £456 million IT system as defective, over-spec and overdue. On this side of the House, the jury is out on whether a computer manager will stay in post long enough to make a difference. I mentioned the claim by the noble Baroness, Lady Hollis, in 1998. By February last year, however, the situation was very different. There was a backlog of almost 330,000 cases and more than £3 billion of debt was stated to be uncollected. Unsurprisingly, the agency received 63,678 complaints in 2004-05. Regretfully, I have been unable to discover any more recent figures. That was an increase of almost 30 per cent on the previous year. ““Something””, in the words of King George VI on his visit to south Wales, ““must be done””. So the Government appointed Sir David Henshaw to conduct a root and branch review. The Bill is the result of his findings. It is notable to start with that he did not recommend departure from a formulaic approach, although we have a different formula to be found in Schedule 4. He did though suggest a different approach in other areas. First, as we have heard, the CSA is to be disbanded and a new body, CMEC, is to be created. That is all well and good, and, if it works, we will lose the stigma that has been attached for far too long to this children’s welfare support system. I welcome that. I also welcome the fact that the money going to the parent with care will be a percentage of the absent parent’s income, which can be varied if that income changes. This income, as we have heard, will be verified by HMRC through the PAYE returns. This variation is accompanied by rough justice. The Bill currently intends that once an award has been made, it should only be altered if the absent parent’s income rises or falls by 25 per cent. That percentage is far too high, especially if the income is falling. I further believe that both the absent parent and the parent with care should be treated fairly. Incidentally, I failed to find ““fair”” until I reached Clause 21. Is it fair that if an absent parent’s income falls by 24 per cent he should still be paying the same amount? Surely that would put him in some financial difficulty. I welcome the fact that no longer will the parent with care be obliged to go to the new agency. Indeed, the Bill goes further and encourages people to make their own arrangements, or, in the case of divorce, accept the settlement of the court. I am worried by the fact that once these settlements have been reached, the parent with care can apply to CMEC for a new approach after only one year under this formula. This is certainly something we will want to explore in Committee, not least because there is anecdotal evidence—which I shall try to pin down before then—that divorce lawyers are advising their clients to delay settlement for as long as possible for this very reason. I spoke about fairness just now. In its administration, CMEC should be as fair to both parents as possible. This fairness extends to the recovery of debt from the absent parent. Just because a child has turned 18, is it fair that the absent parent should get away without paying anything at all? Is it fair that CMEC should charge one parent for its services and not the other? I have other concerns with the Bill. The stigma attached to the CSA is due in large part to the phrases ““absent parents”” and ““parents with care””. Both sets of parents hate being referred to thus, however appropriate the phrases might be in legislation. If any of your Lordships come up with alternatives, I am sure that the Minister will consider them seriously. As the gracious Speech says: "““Other measures will be laid before you””," in committee. However, there is one technical matter that the Minister tried to address in his opening speech. I hope that he will be able to deal with it more fully when he winds up. As he said, the Government announced something at Third Reading in another place that may or may not be a major change to the Bill, or at least to the staff of CMEC; I of course pay tribute, as did he, to the staff of the existing CSA, who presumably will be transferred on the whole to the new body. It is no longer to be a non-departmental public body, but a Crown agency. While I understand that the staff welcome this, what precisely, if anything, does it mean for the parents? What effects will it have on individual Members of Parliament, occasionally including your Lordships, who have raised parents’ problems with Ministers from time to time, as the Minister knows? Over many years, I have had the privilege—often with long intervals—of either promoting or responding to asbestos, pneumoconiosis and other similar orders in your Lordships' House; in other words, the ““other payments”” part of the Bill. This concerns the horrible illness of mesothelioma, a medical complaint associated with the inhalation of asbestos which kills within months of diagnosis. The current position is that the Government make payments to the sufferers which are repaid by the employer’s insurance company at minimum cost to the taxpayer. However, up to now, there has been no payment for what one might call secondary infection. That would include a home owner who contracted the disease because a builder, for example, was careless in removing asbestos from a ceiling. That home owner will be covered, insurance-wise, for the first time, and the builder’s insurance company will ultimately pay. There was quite a debate about plural plaques in another place which, although a feature of this disease, can, I am told, arise from other causes. I am not in favour of including them per se in the Bill. I welcome the opportunity to discuss the Bill in Grand Committee. I hope and trust that when we have finished with it we can be proud of it and say, as I can now with the mesothelioma provisions, that it is a far, far better thing to do than has been ever done.