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Child Support Bill

3.34 p.m.

Report received.

Clause 1 [Applications for departure directions]:

Lord Carter moved Amendment No. 1:

Page 1, line 26, leave out from beginning to end of line 7 on page 2.

The noble Lord said: My Lords, in Committee I moved an amendment which dealt with the question of how applications for a departure direction made outside the 28-day time limit without good reason should be handled.

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The Minister kindly indicated that he was sympathetic towards the intention behind the amendment and agreed that we would be able to deal with it on Report.

The amendment achieves the effect which both the Minister and this side of the House agree is desirable; namely, that persons who apply for a departure direction outside the normal 28-day time limit without good cause can nevertheless have their applications considered from the date of their application. The Minister was kind enough to write to me to say that he has examined the question, has consulted parliamentary counsel and has been advised that the powers in new Section 28G(4) inserted by Clause 7 are sufficient to enable regulations to be made to achieve the results that we want and that subsection (4) of the new Section 28A inserted by Clause 1 can simply be removed, and that is the effect of the amendment.

It would be helpful if the Minister would give some commitment as to the content of the regulations under new Section 28G(4). One of the effects of the amendment would be to delete the reference in the amendment tabled in Committee to allow claims to be considered where there is good cause for their application. I understand from the Minister that that will be catered for in regulations. He was kind enough to send me an example of the existing regulations which makes it clear that that can be achieved.

I look forward to hearing the Minister's explanation as to the content of the regulations. I beg to move.

The Minister of State, Department of Social Security (Lord Mackay of Ardbrecknish): My Lords, in Committee I listened carefully to the comments on this subject of the noble Lord, Lord Carter. I indicated then that I would reflect on what he said. I have decided that I find his arguments persuasive. Our purpose in including a time limit for applications for a departure direction was to reduce as far as possible the period of uncertainty which would exist for both the parent with care and the absent parent while there was a possibility that the amount of maintenance fixed by the formula assessment might be altered.

We were concerned that people should not delay making application, although of course if there were good cause for so doing we proposed that late applications should be accepted. We felt that it would be unfair to the other party if the absent parent or the person with care was able to let the matter slide but then ask, perhaps some time in the future, for a departure which would affect the amount due right back to the date when liability first started.

As I have said, on reflection I agree that it would be equally unfair to exclude someone from any chance of a departure because he or she had failed to act promptly. I am content to accept the proposal that an application made later than 28 days from the issue of a maintenance assessment should be considered but that any direction which results will not be backdated beyond the date of the application unless there was good cause for the delay.

In due course, we shall bring forward regulations to that effect, using the delegated power in subsection (4) of the new Section 28G as introduced by Clause 7. I am happy to recommend that the amendment be accepted.

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Lord Carter: My Lords, I am extremely grateful to the Minister for his explanation and for the letter that he sent me. I hope that he finds this habit-forming as the day wears on—the evening, I suspect—and it is therefore with some confidence that I seek the opinion of the House.

On Question, amendment agreed to.

Clause 2 [Preliminary consideration]:

Baroness Hollis of Heigham moved Amendment No. 2:

Page 2, line 37, at end insert:
("(c) that the entitlement of a person with care to any maintenance disregard calculated in accordance with section 36(5) (bb) of the Social Security Contributions and Benefits Act 1992 would be lost or reduced.").

The noble Baroness said: My Lords, it may be for the convenience of the House if I speak also to Amendment No. 13. This is an amendment about the maintenance disregard—one of the most important issues in the Bill. We on this side support the principles of the Child Support Agency: that absent fathers should support their children and should do so by paying maintenance consistent with their means, thus allowing many first families to float off of benefit. We agree entirely with that. Where the father can pay, he should pay. It is not the taxpayers' job to pick up that bill and his responsibility. The trouble is that in paying maintenance most fathers will make their first families no better off. In many cases, they will make them worse off than if they had avoided their responsibilities and not paid. The amendment addresses that issue.

Why are first families no better off and often worse off on maintenance than they are on income support? Eighty pounds of maintenance would displace £80 of income support, which is what a lone parent with a couple of children might receive. In that situation, a lone parent with two children would be no better off but no worse off. However, when that same lone parent was receiving £80 per week from income support, the benefit carried with it a passport, a portfolio, of other benefits; for instance, free school dinners worth £10 a week for two children, access to the Social Fund for cold weather payments and budgetary loans, and even housing renovation grants.

A woman receiving the same sum from maintenance as from income support loses those passported benefits that are attached only to income support. She is therefore worse off. She received the additional benefits on income support because it was thought that at that level of income she was so poor that she needed additional support. Yet with no extra income, the same sum being paid by maintenance, that additional sum has been taken away from her.

Therefore, given that first families will be worse off if the absent father does his duty and pays maintenance why should those fathers willingly pay and why should mothers willingly co-operate with the CSA to make themselves poorer? The Child Support Agency has lacked consistency. We all know that, and the Minister has accepted it. It has lacked consistency because it has lacked legitimacy and it has been seen as unfair. Hence this amendment, which allows the mother to keep a

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modest fraction of the maintenance. We are talking about £5 to £10 per week—a disregard—before it is deducted pound for pound from her income support. That modest disregard would, roughly speaking, compensate her for the loss of passported benefits such as free school dinners which she would have received if she had stayed on income support. She would be no worse off for obeying the law. Surely that is what we want to see. Surely that is reasonable.

To what are the Government objecting? They have offered three reasons for objecting to the proposal. Their first argument was cost, their second was disincentive, and their third was that the Government were helping mothers anyway by a back-to-work bonus. None of those arguments is sufficiently persuasive to overturn the amendment.

As to cost, a modest disregard to the mother of, say, £5 per week would cost about £85 million after the back-to-work bonus had been netted off. I accept that that is not a small sum but it is almost exactly the sum which the Government have allocated to absent fathers to soften the effect of the CSA. When the Government allocated that £85 million they did not talk about additional costs but about reduced savings. I agree with them; we too are talking about reduced savings for the parent with care. Fewer savings will be flowing because some modest protection will be given to the mother with children in order that she is not worse off. I am sure that today the Minister will not wish to argue that £85 million given to fathers is reduced savings but that £85 million given to mothers is additional costs. I am sure that in all consistency he will wish to apply the same standard in an even-handed way to both parties.

The Government made more of their second argument that a modest disregard would deter lone parents from returning to work. I ask the House in all reasonableness whether a modest disregard of £5 to £10 per week will make a difference as regards a lone parent returning to work. Will £5 per week be the key determinant of whether a mother returns to work? Of course not—we know that that is not the case. Most lone parents want to work. They remain on benefit for an average of only two to three years until the youngest child is of school age. They usually then come off benefit and go back to work. They have been unable to return to work earlier because they have small children of one or two years of age and they do not wish and often cannot afford to find alternative child care for their infants. Are we really pressing reluctant mothers to leave tots of one to two-and-a-half years of age in the hands of others? Are we really saying that having lost their fathers they should now lose their mothers to work, against the wish of their mothers? And that from the party of the family!

What above all restricts women returning to work is child care on the one hand and the lack of available jobs on the other. But once the children are of school age, most lone parents find their way back into the labour market. Whether they do or not, I am sure that all noble Lords will acknowledge that a £5 or a £8 disregard will make no difference whatever. In any event, the Government have accepted that part of the maintenance will be rolled up and returned to the mother at the rate of £5 per week as a back-to-work bonus when she

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returns to work. Why? This is not a Jobseekers Bill; it is meant to be a Child Support Bill. Why then are we giving her a rolled up maintenance disregard, called a "back-to-work bonus", when she is returning to work and therefore has the prospect of being better off rather than when she has children who are dependent on her and when she cannot work and is poorer? That is deeply perverse.

The Government have accepted that with the back-to-work bonus women receive a modest fraction of the maintenance as a disregard. However, they give it to the mothers when they need it less rather than when they need it more. They give it to them when they are leaving their children to work rather than when they are staying at home to care for them. I call that wrong-headed. Lone parents on benefit are very poor. They are often ill-fed, ill-clothed, in poor health and in deep debt. Replacing income support with maintenance will make many of them poorer still.

At a time when the Government are aiding absent fathers—and quite rightly—it is not fair that they are ignoring the plight of mothers who are always much worse off than absent fathers, given the construction of the maintenance system. It is not fair. But we know that mothers with care will not go on strike; they will not desert their children; they will not defy the law; and they will not refuse to do what they are required to do. Whatever the price, they will look after, stay with, and care for their children and to that extent be law-abiding. We punish women for the fact that they obey the law and we have been rewarding the men who break it. I believe that that is unfair.

This amendment would be more even-handed. It would balance the situation between mothers and fathers. It is simple and it is not expensive. It would stop women being worse off by going from income support to maintenance and it would support what will always remain a fragile first family. I beg to move.

3.45 p.m.

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