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Baroness Buscombe moved Amendment No. 10:

The noble Baroness said: My Lords, in moving Amendment No. 10, I shall speak also to Amendments Nos. 11 to 20.

Perhaps I may begin by reaffirming that our overriding interest--which I believe is shared by all Members of the House--is the welfare of children. With that priority in mind, we are very concerned to see significant improvements in the CSA. We listened with care to what the Minister had to say in Committee and, notwithstanding her very clear and full reply, we have felt it nevertheless necessary to revisit the issues at Report stage. It is necessary because we believe that the provisions in Clause 2 will have an enormous impact upon the system--an impact that will not necessarily improve the CSA.

The provisions in the Bill as currently drafted mean that any party, whether or not on benefit, in receipt of a court order after the commencement of the Act will be able to approach the Child Support Agency to have their child maintenance reassessed after 14 months. This may and will cause many problems.

It will see the end of clean-break settlements between husband and wife which provide certainty to both parties and, vitally, to the children of the relationship. It will tie the hands of the courts, which will be forced to assume child maintenance in line with the CSA's formula, even when it is totally inappropriate and unjust to do so. It will make the negotiation of a package of measures almost impossible, as each party will refuse to agree terms knowing that this sword of Damocles will be hanging over their heads with the potential to undermine completely an agreement made in or out of court. It will result in a more confrontational process, with the risk of domestic violence.

The Bill will limit the ability to achieve resolution through mediation, or orders by consent through the new ancillary relief scheme. It will also increase

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spending on legal aid. It will skew maintenance agreements, with the non-resident parent likely to want to pay spousal maintenance purely as a bargaining mechanism, to be traded off against an increase in child maintenance brought about by a referral to the CSA. It will increase the use of sales and charge back and other arrangements relating to the family home, which will be detrimental to children and ex-wives.

The provision runs counter to the fundamental principles of mediation and negotiation that have guided family law reform for more than a generation--principles that complement the general direction of European law and practice.

How do we respond? It is widely felt that, at present, the jurisdiction of non-benefit cases, including top-up, should remain with the courts. Parties must be able to make their own binding agreements. Subsequent referral to the CSA, as now, should be possible only if one of the parties claims benefit or if the parent with care wishes to use the powers of the agency to enforce collection. In the latter case, the agency should be able to collect the maintenance level agreed by the court.

Our amendments seek to respond to these proposals. In our efforts to allay some of the concerns I have raised, I should like to draw the Minister's attention to Amendment No. 15, which was tabled only a few days ago prior to Report stage. It is a probing amendment designed to gain clarification of the Minister's statement in Committee on 8th May regarding the provisions in Clause 2, which are recorded in Hansard at cols. 1301 to 1309. The Minister indicated that,

    "Very simply, no private cases need ever come to the CSA...Only those cases where the parent with care is on a prescribed benefit--normally, income support--would come to the CSA".--[Official Report, 8/5/00; col. 1305.]

Amendment No. 15 is designed to confirm that cases in these circumstances will be accepted by the CSA, as well as cases where maintenance payments are not being paid reliably and the parent with care wishes to approach the CSA.

If cases need only come before the CSA 12 months after a court order is made where the parent with care goes on to a prescribed benefit, couples who agree financial arrangements that are subsequently converted into court orders will continue to be able to do so in the future. The courts will be able to regulate and vary where necessary the maintenance agreement over the following years.

Parents will also have a wide ability to make agreements between themselves. They could, for example, trade off capital or spousal maintenance in return for differing levels of maintenance for the children. The freedom to do this would be lost if either party were able to renege on an agreement by approaching the CSA after 12 months in the belief that they could better an agreement that was fairly made between them previously. Neither party would be prepared to make concessions or a trade off if they thought it could be overridden in a year's time by the

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CSA, which would make a completely fresh assessment and completely ignore the concession or trade-off which was made 12 months previously.

Clause 2 would also undermine government policy on family matters--which is, wherever possible, that parents should be encouraged to enter into mediation and discussions in order to settle spousal maintenance. There are circumstances where parents may wish to make agreements without involvement from the CSA, and these could include the following.

First, the parents could agree that the payments for the children will be greater than the CSA would assess. The most common reason for this is likely to be in return for a trade-off--for example, the mother will agree to make no maintenance claims for herself (known as a clean break) in return for a better level of maintenance for the children. This can have benefits all round. The non-resident parent is happier to pay the money because it is deemed to be going to the children, and it gives a definite length to the maintenance obligation. In turn, the mother no longer has to concern herself about forming new relationships and the effect that that could have on the maintenance.

Secondly, parents could agree to a lesser sum than the CSA would assess. Again, this will often be as a result of financial trade-off. For example, the non-resident parent may transfer capital or the house to enable the mother and child to remain housed, with the mother accepting a lesser level of maintenance for the children in return. The scope for this kind of settlement is likely to increase under the new CSA where the resident parent's income is no longer taken into account. One could have situations where the resident parent works and has sufficient income, but there is a need for capital to secure accommodation for the children.

To benefit from these exemptions the parents need to have their agreements approved by the courts. This provides an important protection against a parent being pressurised into unsuitable agreements, while, at the same time, providing a straightforward and established procedure. It is a procedure that is frequently used when divorcing parents have been able to reach agreement on general financial aspects, because it enables them to ask the courts to confirm the terms of an overall settlement that may well include spousal maintenance and capital at the same time as child maintenance.

The effect of allowing the CSA to consider cases that were decided in the courts 12 months previously would mean that either parent could call upon the state to intervene and override an agreement that they had reached, even if that agreement had been reached after full advice and after a court had approved the terms. On the other hand, one can see many benefits in allowing the current situation to continue, which enables separating parents to agree their own financial arrangements, subject to the protection of court approval, which will ensure that those arrangements are both reasonable and realistic.

Finally, I should like to turn in particular to Amendment No. 20, where the court is to consider a variation. Briefly, the new arrangements will allow a

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court order to be assessed after it has been in force for 12 months, although the assessment will in fact take place after 14 months--12 months plus two months' notice. At present, this assessment cannot take place, but a court can vary an existing order. Under the new arrangements, it will not be possible to apply for a variation, even if both parents wish so to do. If they can agree, they will have to go through the rigmarole of discharging the old order and making a new one, which is all grist to the lawyers' mill. If they cannot agree, they will be forced to go to the CSA. I beg to move.

5 p.m.

Lord Goodhart: My Lords, I rise to support what has been said by the noble Baroness, Lady Buscombe. We have always held the position that the child support system is basically crude and formulaic. It is far less effective in reaching fair and balanced arrangements than maintenance orders made by the court on the basis of the facts of the individual case or, even better, agreements reached between the parties and approved by the court.

The only advantage offered by the child support system is its cheapness, although even that seems to be a matter of considerable doubt. Our view, therefore, is that it is both wrong and counter-productive, where it is possible for orders to be made by the court or by agreement between the parties, for the result which will have been worked out based on the individual circumstances to be capable of being overridden on application to the CSA by whichever party feels that they would do better out of it, thus applying this very crude child support formula. For that reason, we feel that these amendments are plainly a move in the right direction and we support them.

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