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Child Support (Miscellaneous and Consequential Amendments) Regulations 2009

My Lords, it is a pleasure to follow the noble Viscount, Lord Eccles. He has done the House a service with his forensic analytical examination of these regulations and I agree with what he said. I am one of those poor unfortunates who have been looking for clarity and simplicity in child support legislation since 1991, but it has always eluded me and continues to do so. I take a slightly different view from the noble Viscount. He has taken a very legal approach and I understand his analysis and support his attempt to solve the problem. Furthermore, he is right that these amendment regulations do not do the job at all. But from my perspective, this is all about clarifying rules and variations. I hate it when people say to me, ““I told you so””, but I cannot resist saying to the Minister that during our consideration of the Child Maintenance and Other Payments Bill 2008, I did tell him that we needed a general, catch-all provision for gratuitous alienation, as it used to be known in the old Benefit Agency days. There is no end to the creativity of non-resident parents when it comes to finding ways of not discharging their legal maintenance responsibilities for their children in the hands of the caring parent, and it is a false hope to think that we can draft a law to cover every eventuality. We have been discussing the particular loophole in relation to pensions, but if it is not pensions, another diversionary tactic will be along in a moment. The amendment regulations we are now considering are a direct result of the fact that a non-resident parent was shovelling two-thirds of his earnings into a pension scheme and thus reducing his income for child maintenance purposes. Not the agency, not the commission, not the commissioner and not the decision-maker could find a legal basis to challenge him, despite the fact that what he was doing was a denial of common sense that destroyed the spirit of the legislative base for the Child Maintenance and Other Payments Act 2008. None of those bodies could touch him because of the strict nature of the variation scheme introduced in that legislation. Everyone who applied their mind to it was left wanting in terms of a power to do anything about it. It is a simple fact that the variations rules are now so tightly drawn that they prevent common sense prevailing. I suggested an amendment to pave the way forward, and I dug out the briefing I used when I tried to introduce a new paragraph to Schedule 4 to the 2008 Bill entitled, "““Prevention of maintenance evasion by non-resident parents””." Admittedly it was a blunt instrument and drawn in a way that would give a decision-maker the discretion to apply a test of reasonableness on potential diversions of income. If that amendment to the schedule had been accepted and the power existed in the Bill, the decision-maker could have dealt with this case in a clear and straightforward way. We would not have needed this set of amending regulations. My charge to the department is this: it should have seen this coming. The noble Viscount, Lord Eccles, is right when he says that the legislative ink on this Act has yet properly to dry, and here we are, bringing forward in regulations fundamental amendments which, in a sensible system that produced watertight legislation—I hope we all aspire to do that in this place—would not be necessary. We failed in this case, in a way that I believe was foreseeable. The variation scheme is going to become even more important because as the Child Maintenance and Enforcement Commission progresses into the new regime, it will have to rely far more on HMRC data. That is going to be rough justice. The variation scheme will have to be applied to HMRC data in a way that will create all sorts of problems of this kind if we do not undertake a review of the current strictness of the variation regime that was introduced in the 2008 legislation. It pains me to say that under the old 2003 system before the last set of reforms were brought in we had an element of discretion to get a decision-maker to apply a common-sense test to attempts to alienate income. We made a complete hash of it in the 2008 legislation. I support these regulations as far as they go but they are not adequate. The noble Viscount, Lord Eccles, is right; we will need to return to this unless the Government rigidly and urgently undertake a review of the current variation scheme. There will nothing but trouble of this kind in the future until that gets done.