HC Deb 17 July 1995 vol 263 cc1348-51

Lords amendment: No. 9, in page 29, line 33, at end insert—

(". In section 33 (liability orders), at the end add— "(5) If the Secretary of State designates a liability order for the purposes of this subsection it shall be treated as a judgment entered in a county court for the purposes of section 73 of the County Courts Act 1984 (register of judgments and orders).")
The Minister for Social Security and Disabled People (Mr. Alistair Burt)

I beg to move, That this House doth agree with the Lords in the said amendment.

The amendment gives the Secretary of State power to apply for a liability order to be entered in the register of county court judgments. Hon. Members may be aware that when an absent parent fails to pay maintenance liability and arrears have built up, the Child Support Agency will make every effort to reach an agreement to repay. If the absent parent refuses to reach such an agreement or reneges upon it, enforcement action must be considered.

In the majority of cases, the first stage in that process is likely to be a deduction from earnings order. However, when that fails or when it cannot be imposed—for example, when the absent parent is self-employed—the agency will ask a magistrates court to make a liability order. There is always a hearing before such an order is granted. A liability order can lead to distress action or to a garnishee or charging order. The amendment will allow an alternative course of action—the placing of the order on the register of county court judgments.

An entry in the register can lead to difficulties for an individual if he seeks credit for personal or business purposes. Experience in other areas has shown that, for that reason, the threat of an entry in the register is an incentive to debtors to pay their liabilities, especially if they are self-employed.

As I said, liability orders are needed only in cases where the absent parent has refused to pay his legal liability and will not co-operate on the repayment of arrears. Absent parents have it within their own hands to avoid a liability order and entry in the register. I stress that liability orders will not be entered automatically in the register. The absent parent will be given ample opportunity to change his mind and co-operate with the agency before it takes the step of having the liability order entered in the register of county court judgments.

Even before an application for a liability order is made to the magistrates court, the absent parent will be advised that if the order is granted, the debt may be entered on the register. When the liability order is granted, he will be given a further warning that registration will be considered if arrangements to meet the liability have not been made within a reasonable period. Therefore, the absent parent can easily avoid the consequence of registration by co-operating and meeting his obligations on child maintenance even after a liability order has been obtained.

5.45 pm

It is regrettable that there are some obstructive absent parents who deliberately attempt to delay or avoid their responsibility to their children. It is right for us to do all that we can to ensure that parents with care receive promptly the payments to which they are entitled. Our experience of enforcement to date has been such that we think that the extra power would be useful. We took advice from those who regularly deal with such matters, as the House had wished us to do.

I hope that the House agrees that the amendment provides a further effective means of enforcement in cases where absent parents seek to evade their liabilities. I thank all those who have worked so hard in recent years to make what will be the Child Support Act 1995 more workable. That includes Opposition and Government Members, people outside who work on policy developments and people in the agency. I hope that the amendments and the Bill are evidence that the Government have listened to concerns and that they will give the assurance that the Government will continue to listen to representations about problems related to child support. Over the next couple of years, we hope to see improvements built upon the hard work that has been so patiently done by so many.

Mr. Bradley

No one would deny the Minister an opportunity for a reprise on the Child Support Agency. He is already looking 10 years younger than when he was last at the Dispatch Box. I am grateful for his explanation about the introduction of the liability orders. There is a clear need to be even-handed in our approach to the employed and the self-employed and we must ensure that, where possible, there is co-operation on these matters. I am grateful for the assurance that the liability order will not automatically be placed on the register, because the fact that the matter is now in legislation means that there is more likelihood of the self-employed person making his maintenance payments. In that context, we support the amendment.

Lords amendment agreed to.

Lords amendment: No. 10, in page 29, line 46, at end i n sert—

(". In section 46(5) (circumstances in which child support officer may give a reduced benefit direction), after "may" insert ", except in prescribed circumstances,".")
Mr. Andrew Mitchell

I beg to move, That this House doth agree with the Lords in the said amendment.

A parent with care who receives or whose partner receives a relevant benefit must give her authority for child maintenance to be sought from the absent parent if she is required to do so by the Secretary of State. If she refuses to give her authority without good cause, section 46 of the Child Support Act 1991 provides that her benefit may be reduced.

The amendment was tabled in another place in response to an Opposition amendment. It would enable the Secretary of State to prescribe the circumstances in which the benefit reduction should not apply, thus adding flexibility to the provisions relating to reduced benefit deductions, which already allow for a direction to be suspended.

We listened to what was said in another place and are persuaded that where a parent with care or any child living with her is disabled, the benefit reduction may cause particular hardship. Therefore, we intend to introduce regulations as soon as practicable to exempt parents in such circumstances from the reduced benefit direction. The Government have also undertaken to introduce regulations at the same time, to suspend the reduced benefit direction in cases where the parent with care has deductions made from her income support—for example, to repay fuel debts or rent arrears. The benefit reduction is intended to make the parent with care think carefully about her decision not to co-operate, and the Government think that that is right. The amendment will mean that in specific circumstances, where the reduction could cause particular hardship, the reduced benefit direction will not be imposed. I invite hon. Members to accept the amendment.

Mr. Bradley

I am grateful for the Minister's explanation of the amendment. Clearly, however, we shall need to see the precise wording of the regulations to be able to determine how they will work in practice and who will be covered by them. Yet again, as we said on several occasions in Committee, we need to see and debate the details of the regulations before we can be certain that they cover the points raised not only in the other place, but in Committee.

We are pleased that the Bill is about to complete its passage. We were supportive in the way in which we tabled amendments to the Bill, particularly in terms of the departure direction, and we have facilitated its progress. However, we are still extremely disappointed that the Government have not yet agreed to another fundamental change—introducing a proper child care disregard to make the legislation truly put children first, by making an additional amount available to the parent with care who so desperately needs the money, rather than having all the money absorbed by the Treasury.

There is continuing concern, as shown in the evidence that is being compiled, about the operation of the agency. Recent evidence to the Public Accounts Committee was extremely disturbing in terms of what it showed about the amount being collected and the amount passing from the absent parent to the parent with care.

The Labour party will continue vigorously to monitor the operation of the Act, to ensure that the further amendments that will be required to ensure equity and fairness in the system are brought forward at the earliest opportunity. Although we have facilitated the passage of the Bill, that does not mean that we are satisfied with the operation of the agency or that we are satisfied that the legislation covers all the aspects necessary to ensure that the principle we support—that all parents should take responsibility for the upbringing of their children—is properly defined within legislation.

We shall continue to monitor and look carefully at all aspects of the Act, including the way in which it is administered through the agency, to ensure that there is even-handedness and fairness between the parent with care and the absent parent. We also need to ensure at the end of the day that the real beneficiaries of child support legislation are the children who so desperately need the income to maintain a proper living standard and that the parents caring for them, especially those on income support, are not kept in poverty because of the Government's failure to recognise a proper child care disregard.

Mr. Andrew Mitchell

I am grateful to the hon. Gentleman for what he said about the Bill. I am sorry that we were unable to persuade him of the superior benefits of the child maintenance bonus. I have, however, heard what he has said—indeed, I heard it throughout the Committee stage when I was the Government Whip responsible for the Bill. I am, therefore, very familiar with his arguments.

The hon. Gentleman emphasises the importance of the administration of the agency getting better and rendering the service to the parent with care, the absent parent and the taxpayer that we all expect. That is a point that is well made and an aspiration with which hon. Members on both sides will agree.

Lords amendment agreed to.

Lords amendment No. 11 agreed to.

Lords amendment No. 12 agreed to [Special Entry].

Lords amendments Nos. 13 and 14 agreed to.