The Conservative Government of the late 80s and early 90s did much to redefine the relationship between the private family and the state. In particular, they placed the involvement of state agencies, when ‘things go wrong’ in families, on an entirely new footing. The Children Act 1989 was a seminal piece of legislation that established clear principles of safeguarding the welfare of children, promoting their best interests, and critically, advocating that the people best placed to care for children are their own families (unless substantial evidence demonstrated this is no longer the case). While it was an evidence-based and meticulously crafted piece of legislation, politically, it bore all the hallmarks of right-of-centre policy making, in as much as respect for the privacy of individuals – and their families – lay at its heart. So when, two years later, the Child Support Act came in to force, many commentators saw it as an infringement of the rights established in the previous piece of legislation, because it sought to involve the state in the financial affairs of divorcing parents in a manner not seen before. The Department of Health (who had masterminded the 1989 act) and the Treasury (who established the Child Support Agency via the 1991 legislation) were seen to be at odds.
Twenty-three years later we are seeing a turning of the tide, and a return to approaching the arrangements between separated parents as ultimately their own affair. The Child Support Agency (CSA) is to close, and in its place, the new Child Maintenance Service (CMS) opens its doors, with a rather different remit to its predecessor. The DWP has informed, by letter, all those who use the CSA to extract financial support from their ex-partner that if they want to continue using the CMS to perform the same task, they will, in six weeks’ time, be charged to do so. Here’s the detail;
- The majority of parents making a new application to the Child Maintenance Service (CMS) will have to pay a £20.00 application fee (this includes parents that are transferring from the old service provided by the Child Support Agency to the new CMS).
- If parents use the collect and pay service that is arranged through the CMS to collect and pass on payments, which is an arrangment based upon when the paying parent receives their wages, pension or benefit, then, a fee will have to be paid each time a payment is made and received.
- Paying parents will pay a 20% fee on top of their regular child maintenance payment.
- Receiving parents will have a 4% fee deducted from their regular child maintenance payment
Parents can avoid these charges by;
- making their own informal arrangements. This is called a family based agreement. The child maintenance calculator can be used to work out how much should be paid and the family based agreement can then be based on this figure. Parents can still use the CMS service and set up ‘Direct Pay’ arrangements without been charged an administration fee. The easiest way to pay is by standing order. The payments go direct from the paying parent’s bank, building society or Post Office account into the receiving parent’s account.
- Parents who are under the age of 19 will not have to pay the application fee.
- Parents can still use the CMS service and set up ‘Direct Pay’ arrangements without been charged an administration fee. The easiest way to pay is by standing order. The payments go direct from the paying parent’s bank, building society or Post Office account into the receiving parent’s account.
- People who have suffered domestic violence will not have to pay the £20.00 application fee if they have sufficient evidence of the domestic violence suffered.
Work and Pensions Minister Steven Webb has said “The goal here is to get more child maintenance for more children and to make the default for parents, even though they have separated, to sort things out for themselves rather than rely on the state bureaucracy… “If we don’t raise a penny in charges I will be the happiest minister in government… Crucially, because there is a 20% penalty on the dad in most cases, he has a strong incentive to pay direct to mum, in which case all these charges drop away. So it’s a much better system for children and for parents.”
In contrast, Gingerbread’s chief executive Fiona Webb fears that the new system will lead to unstable arrangements that ultimately lead many families to being worse off, estimating that 100,000 parents will find it hard to reach an amicable agreement once their CSA cases are closed. She states, “Child maintenance can make a big difference to children, so we encourage all parents not to be put off by the charges but to seek help, if they need it, to make arrangements for their children. Case closure and charges will act as a barrier for many poor parents trying to secure regular support for their children.”
Only the passage of time will tell us whether this new system brings about savings for the state, and an improved method for making payments for the families involved. Rest assured however, that we here at Prince Family Law can assist you in understanding these changes and ensuring that, whether you make or receive payments, the best deal is being achieved for you and your little ones.