The child maintenance calculation is initially based on paying parent’s historic income information received directly from HM Revenue & Customs for the latest complete tax year.

If historic income is not available, or a paying parent’s actual income is at least 25% different from the historic income figure then current income can be used. This is based on evidence from a wide range of credible sources which ensures liabilities remain fair and based on accurate income information. The liability is reviewed annually or at either parents’ request if the income changes by at least 25%.

On 3 July we published ‘Gender equality at every stage: a roadmap for change’, which sets out our plans to address the persistent gendered barriers people face at every stage of life. As part of the development of the roadmap the Minister for Women and Equalities engaged with ministers across government, including the Secretary of State for Work and Pensions, on a range of issues related to gender equality.

Child Maintenance Group (CMG) have only recorded Compensation Payment details for CMS separately since 2017/18, so we are unable to identify CMS only costs prior to that financial year.

For 2017/18 and 2018/19 the CMS figures are as follows:

However the data for the volume of consolatory payments is not routinely recorded.

Both paying and receiving parents have a responsibility to inform the Child Maintenance Service of any change in circumstances. There are no sanctions for receiving parents who do not report circumstances where a child is no longer eligible for maintenance. If either party reports changes that confirm a child cannot be treated as a child for the purpose of child maintenance liability, then the Service will update the maintenance calculation. This change can be retrospective, as the effective date of this decision is treated as the date the child ceased to qualify for child maintenance.

The Child Support Maintenance Calculation Regulations 2012 introduced a new gross weekly income threshold for child maintenance, for those earning between £800 and £3000 a week.

The number of paying parents in maintenance arrears, and the amount of unpaid maintenance on their cases as of September 2018 for the constituency of Lanark and Hamilton East are outlined in the table below.

Note: Paying parents are rounded to the nearest 10, unpaid maintenance is rounded to the nearest £10,000.

Paying Parents using the Child Maintenance Service can either arrange the payments between themselves (Direct Pay) or if the parents cannot do this or they don’t pay, the Child Maintenance Service have the Collect & Pay service which can collect and manage the payments between the parents. The Department has no knowledge of what has been paid for Paying Parents using the Direct Pay service as parents manage the payments between themselves. In September 2018, 65% of Child Maintenance Service arrangements were Direct Pay.

The Department does hold data on compliance rates for Paying Parents using the Collect and Pay Service which can be seen in ‘Table 7: Paying Parent Compliance’ of the Child Maintenance Service statistics: August 2013 – September 2018.

https://www.gov.uk/government/statistics/child-maintenance-service-august-2013-to-september-2018-experimental

Please note that the table does not accurately represent the proportion of Paying Parents who are in arrears. “Compliance” means that the paying parent paid some child maintenance in the last three months. So a parent may have paid some child maintenance but may still be in arrears. If a parent is not compliant they have not paid any of their liability in the quarter.

My Department is fully committed to supporting victims of domestic abuse to ensure they receive the help and support they need to use the Child Maintenance Service safely.

Charging is key to our policy of encouraging collaboration between separated parents and research shows that receiving parents who have received a waiver of the £20 application fee due to reporting domestic abuse are just as likely to have an effective arrangement as other receiving parents.

The Child Maintenance Service is designed to be a safe service for victims of domestic abuse and support includes:

• ensuring staff are trained to respond sensitively to domestic abuse issues.
• facilitating the exchange of bank details.
• ensuring personal information is not shared.
• providing information about setting up bank accounts with a sort code, which do not allow parents to be traced.
• waiving the £20 CMS application fee.
• signposting to organisations able to provide parents with specific support on the issue of domestic abuse.

We remain of the view that there is no evidence to justify a change to the charging structure but we continue to keep our policy under review.

Real Time Information is not currently included within the income information provided by HMRC to calculate a child maintenance liability. Income information is provided by HMRC for the most recent complete tax year they hold within the previous six years.

More recent income data can be used in specific circumstances where a paying parent’s circumstances have changed in a way that breaks the 25% tolerance, requiring their calculation to move from historic to current income.

The income information HMRC provide is based on Pay As You Earn (PAYE) and self-assessment records. This captures income from a range of taxable benefits, including Income Support; Incapacity Benefit; income related Jobseekers Allowance; and Employment and Support Allowance.

The information requested is not collated centrally and could only be provided at disproportionate cost.

The annual review ensures that the child maintenance liability is based on the paying parents most up to date earnings and reflects any changes in their income during the most recent complete tax year.

Paying parents are legally required to inform the Child Maintenance Service of any change to their circumstances which could affect their child maintenance liability, including changes with regard to other children they are responsible for.

The Service’s definition of a day-to-day care for the purpose of establishing the receiving parent is broadly aligned with that of Child Benefit, where an overall care test is used to determine entitlement. Entitlement to receive Child Benefit is used as an indicator at the application stage. There are currently no plans to change the process of establishing maintenance liability.

As company directors are considered to be employed by the company, we use the most recently available income data directly from HMRC to calculate how much child maintenance should be paid. Where company directors receive additional income from dividends, property, savings or other investments, this can be taken into account through an unearned income variation.

There is no plan to publish this information. As specified in the original response, the tax year information was only available due to a recent sampling exercise which would not be appropriate for ongoing publication.

In the first instance the Child Maintenance Service (CMS) will use HMRC data to assess liability. If this is not available, CMS sources information directly from the paying parent or their employer. CMS have powers to estimate income where the information provided is insufficient or atypical. This estimation will initially be based on the most recent HMRC information available or, depending on the circumstances of the case, the Annual Survey of Hours and Earnings (a sampled survey of employers taken by HMRC).

Where there has been a reported change in Paying Parents income which exceeds the 25% tolerance, the first step we would take is to obtain evidence to verify the income. Dependant on how the change is reported, this could be via the employer, receiving parent, HMRC or the Paying Parent. Where an income change is proven, the next step would be to complete a reassessment/supersession and pursue any arrears payments with the Paying Parent. All steps /actions will be specific to the detail of the case. Ultimately where there is evidence of criminal activity CMG can pursue a criminal prosecution through the CPS.

Basing the assessment on HMRC data has enabled the Child Maintenance Service to significantly speed up the set-up of new cases which can be key to securing regular payments. The previous approach of obtaining the information from parents often led to considerable delays and significant arrears building up on cases right from the start.

Child maintenance is reviewed annually using HMRC data to make sure it is in line with a parent’s circumstances. Between those reviews, parents are required to report any changes in their income that are greater than 25 percent – such changes will trigger a reassessment of the maintenance due.

Income information is provided by HMRC under a data sharing agreement for the most recent complete tax year they hold within the last six years. HMRC determines a tax year as complete when they have accounted for all Pay As You Earn (PAYE) and Self Assessment records.

Each year HMRC receive and process income figures from 33 million Pay As You Earn (PAYE) and 3.3 million Self-Assessment customers. HMRC undertakes compliance activity to ensure that the data reported to them is accurate.

My Department has recently laid regulations which would allow a notional income to be assessed from certain assets. This will ensure that parents who are able to organise their financial affairs to minimise their taxable income, still have an obligation to pay maintenance for their children at a level which reflects their financial circumstances.

Basing the assessment on HMRC data has enabled the Child Maintenance Service to significantly speed up the set-up of new cases which can be key to securing regular payments. The previous approach of obtaining the information from parents often led to considerable delays and significant arrears building up on cases right from the start.

Child maintenance is reviewed annually using HMRC data to make sure it is in line with a parent’s circumstances. Between those reviews, parents are required to report any changes in their income that are greater than 25 percent – such changes will trigger a reassessment of the maintenance due.

Income information is provided by HMRC under a data sharing agreement for the most recent complete tax year they hold within the last six years. HMRC determines a tax year as complete when they have accounted for all Pay As You Earn (PAYE) and Self Assessment records.

Each year HMRC receive and process income figures from 33 million Pay As You Earn (PAYE) and 3.3 million Self-Assessment customers. HMRC undertakes compliance activity to ensure that the data reported to them is accurate.

My Department has recently laid regulations which would allow a notional income to be assessed from certain assets. This will ensure that parents who are able to organise their financial affairs to minimise their taxable income, still have an obligation to pay maintenance for their children at a level which reflects their financial circumstances.

We do not currently report on the tax years used in the calculation of Annual Reviews. In the spirit of answering the question asked, at the Initial Calculation stage we use income from the following: 82% from HMRC, 9% from Benefit systems and the remaining 9% from Paying Parents or Employers. Recent sampling of the HMRC supplied information shows 82% of Initial assessments use income data from the last two tax years (2017/18 & 2016/17), 10% from previous years and 8% have no tax year provided and will not be used to calculate the assessment.

Basing the assessment on HMRC data has enabled the Child Maintenance Service to significantly speed up the set-up of new cases which can be key to securing regular payments. The previous approach of obtaining the information from parents often led to considerable delays and significant arrears building up on cases right from the start.

Child maintenance is reviewed annually using HMRC data to make sure it is in line with a parent’s circumstances. Between those reviews, parents are required to report any changes in their income that are greater than 25 percent – such changes will trigger a reassessment of the maintenance due.

Income information is provided by HMRC under a data sharing agreement for the most recent complete tax year they hold within the last six years. HMRC determines a tax year as complete when they have accounted for all Pay As You Earn (PAYE) and Self Assessment records.

Each year HMRC receive and process income figures from 33 million Pay As You Earn (PAYE) and 3.3 million Self-Assessment customers. HMRC undertakes compliance activity to ensure that the data reported to them is accurate.

My Department has recently laid regulations which would allow a notional income to be assessed from certain assets. This will ensure that parents who are able to organise their financial affairs to minimise their taxable income, still have an obligation to pay maintenance for their children at a level which reflects their financial circumstances.