The Child Maintenance Compliance and Arrears Strategy
There is much reported evidence to show that children from separated families are more likely to have positive outcomes in later life if their parents can work together. A positive contribution towards this is when parents feel able to make arrangements between themselves regarding the payment of child maintenance without state intervention. For those who cannot make a family based arrangement an effective statutory scheme is critically important and this takes the form of the Child Maintenance Service.
Any parent can pay a £20 administration fee and ask the CMS for a formal assessment. Once carried out the CMS will advise parents on their options for the collection and payment of maintenance. If for any reason the parents cannot agree this themselves, the CMS can become involved in this process. The CMS will charge the paying parent 20% on top of what they have been assessed to pay and will deduct 4% of the funds before money is paid to the receiving parent.
The CMS also have wide extensive powers to deal with the enforcement of child maintenance payments and also try and tackle any arrears from old claims under the Child Support Agency (CSA), which is no longer in effect. On 14 December 2017 the Government published ‘Child Maintenance: A New Compliance and Arrears Strategy’. This public consultation put forward a range of proposals intended to further improve compliance in the CMS. The consultation invited responses to 15 questions covering proposals for changes to how child maintenance liabilities are calculated, new enforcement powers for the CMS and how to deal with CSA arrears.
From this consultation the Government intends to bring changes to various child maintenance regulations already in place in order to allow the CMS to do the following:
- enable deduction to be made from joint and business accounts with safeguards in the form of checking up to the last six months’ bank statements to establish ownership of funds before progressing deduction orders. Where this isn’t possible, a pro-rata approach will be taken that assumes 50% of the funds in the account belong to the paying parent unless evidence is received to the contrary.
- A new power to confiscate passports from those who repeatedly refuse to meet their child maintenance obligations (for England, Scotland and Wales). The ban can be revoked or reduced where full and part payment of arrears covered by the disqualification order is made. Parents will be given 48 hours to surrender their passport.
- Make improvements to maximise the use of current powers, for example setting up Deduction from Earnings Orders at the point of application where the paying parent does not set up a payment method. There is also on-going discussion with HMRC over options for making better use of the data they hold with the aim of developing specific proposals with HMRC to meet the needs of the CMS in the light of the consultation.
It is proposed that these changes be implemented by Autumn 2018.
Amanda Erskine is a solicitor in the Family department at Barker Gotelee Solicitors.