HC Deb 01 February 2000 vol 343 cc1017-24

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Betts.]

9.53 pm
Mr. Jim Murphy (Eastwood)

This debate is about the Child Support Agency's handling of the case of one of my constituents. The issues are difficult and affect families—especially young children—in my constituency. I would not normally give the names of the people involved, but my constituent has already spoken publicly about the case. As the matter is in the public domain, thre is no difficulty about mentioning his name.

I unreservedly welcome many of the positive reforms that the Government are carrying out in respect of the CSA. I hope that those changes will mean that the circumstances of my constituent's case are never repeated.

A summary of the case will enable the House to understand how badly my constituent, Mr. Reilly, was treated by the agency. I shall go over the case, deal with some of the issues and perhaps request my hon. Friend the Minister to investigate some of the more pressing concerns of my constituent and myself.

The agency made deductions from Mr. Reilly's earnings, and as a consequence he could not maintain his mortgage payments and then lost his house. Mr. Reilly's health suffered; indeed, his own GP is on record as stating that he suffered stress. As a consequence, he also lost his job.

I have been involved in this terrible case for a long time. Mr. Reilly came to my first ever constituency surgery, in the month after the general election. I believe that he has been at every one since. I have written more than 50 individual letters about the case, to officials, the agency, the independent case examiner and Ministers. I have met representatives of the agency on two separate occasions at two different venues to discuss the specifics of the case. I even attended the tribunal hearing relating to the case. Despite the years of effort and the many hours of meetings and letter writing, we still have not obtained any justice for Mr. Reilly.

Let me explain the facts of the case. I shall deal with the issue of the assessment and how the tribunal dealt with the case, and then I shall make a plea for proper compensation for Mr. Reilly.

In the process of assessment that contributed to so many of the difficulties, the agency did not take into account all the figures, all the factors and all the circumstances involved in the family. Mr. Reilly paid more than £7,000 in maintenance. He has since received £1,600 of that back, but not all the figures relating to the relationship between the agency and the Benefits Agency were properly administered, communicated or dealt with. The independent case examiner, who recently reported on the case, said that the Agency performance over this issue has been very poor". That contributed to the serious problems that my constituent experienced.

We then sought the tribunal hearing—which I attended, as I said—and the tribunal made certain recommendations arising from the case. However, the recommendations were not acted on and they did not improve my constituent's life. Then the case was closed, despite the fact that the recommendations had not been acted on. The independent case examiner said in his report that he was concerned about the way in which the agency had acted upon the tribunal's decisions, and recommended that £1,600 of the £7,000 be returned.

I emphasise that, although I attended the tribunal; although more than 50 letters were written; and despite the meetings that I had with officials, the tribunal's findings and recommendations were not acted on.

I shall now discuss compensation—a subject that I recently had reason to discuss with the chief executive of the agency, Miss Faith Boardman. I also had correspondence from the special payments unit of the Child Support Agency. I quote the recent correspondence: Compensatory payments for financial loss are intended to restore a person to the financial position that they would have had it not been for Agency maladministration". The purpose of compensation payments is clear, and the special payments unit has publicly stated it.

Throughout that process, Mr. Reilly received a £100 compensation payment while an independent case examiner's report was being prepared and written. Point 25 of the report recommended that a "substantial" compensation payment should be made to my constituent for the harassment and the consequences of the CSA's maladministration in terms of loss of employment, loss of health and loss of home.

Inevitably, I have become closely involved in the case and feel strongly about it. On the day on which Mr. Reilly received that letter, he came into my parliamentary office. For the first time he had come not seeking advice but offering thanks—in fact, bringing presents of a very small monetary value, well below any level of declarable interests. He was delighted by the independent case examiner's recommendation that there should be substantial compensation, as was I. After more than two years of effort, I thought that we had achieved some justice for my constituent. At best, I was surprised—

It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.

Motion made, and Question proposed, That this House do now adjourn.—[Mrs. McGuire.]

Mr. Murphy

I did not expect to have to give way to my Whip during the debate, but I shall not detain the House for much longer.

When we received the letter, we felt a sense of achievement. I have written more correspondence, had more meetings and expended more energy on this case than on any other of the many cases with which I have been involved. I thought that, finally, we had achieved justice and compensation.

The sense of disappointment, surprise and annoyance—however one wishes to describe it—was considerable when the Child Support Agency acted on the recommendation of the independent case examiner. It provided by post a cheque to my constituent, as compensation for its maladministration and mistreatment of him over several years, for the princely sum of £50.

I have not had time this evening to check a dictionary definition of the word "compensation". However, I know that under no circumstances would £50 be thought to be considerable or substantial compensation. We felt real disappointment at the way in which the compensation issue has been dealt with on my constituent's behalf.

In recent discussions with the Child Support Agency, I asked it whether £50 was considered to be substantial. It admitted that it was not. I therefore make a plea for justice on my constituent's behalf. I would not normally try to secure an Adjournment debate or detain the House on an individual case, but I hope that the Minister understands that I believe that I have exhausted every other avenue, including writing an incredible amount of correspondence. That is my job, and I am not asking for acknowledgment of that. However, there has been so much correspondence and so many meetings, and I have felt so frustrated by the highs and lows that I have experienced that I felt that there was no other option than to apply for an Adjournment debate.

I hope to achieve three things from the debate. First, I hope that there will be a thorough investigation of the communications between the Child Support Agency and the Benefits Agency and that the full facts, the full figures and, crucially, the dates relating to the case are put into the public domain. The key to that is the communication that did or did not take place between the Child Support Agency and the Benefits Agency.

My second aim is related to my first. I hope that there will be an investigation into how much Mr. Reilly should have paid. He is comfortable about contributing and wishes to pay his fair share based on the formula, but how much should he have paid? If the investigation finds that he has paid more than he could fairly be expected to pay, some of the £7,000 should be repaid to him. Of course, £1,600 has been repaid as a result of the case examiner's report, but an investigation should still be carried out into the substantial sum that he paid.

My third aim is perhaps the most important. I know that there is no formal appeal process, but I urge that there should be a review of the level of compensation that is paid. Bearing in mind all the difficulties that my constituent and his new family have experienced over a number of years and the stress and the impact on Mr. Reilly's family life, there should be a full review of the level of compensation. I know that others—probably rightly—have received much more substantial payments than £50. I urge that, in the review, the £50 figure is upgraded substantially in line with the independent case examiner's report, so that Mr. Reilly can at least have some financial recompense to help him and his family to rebuild their lives.

10.4 pm

The Parliamentary Under-Secretary of State for Social Security (Angela Eagle)

I congratulate my hon. Friend the Member for Eastwood (Mr. Murphy) on being successful in the ballot for Adjournment debates and on the excellent way in which he has represented his constituent in this difficult case.

As my hon. Friend will appreciate, I am bound by the rules of confidentiality and cannot therefore respond in detail in the House to the points that he has made about the CSA's handling of this case. I share his concerns, however. It is clear that the standard of service that Mr. Reilly received falls far short of what is acceptable. I shall be happy to meet my hon. Friend in a more discreet environment to discuss the details of the case.

I apologise on behalf of the agency for its mishandling of the case. The problems date back over six years and flow from a succession of errors and failures on the part of the agency. I understand that the CSA's independent case examiner has now investigated my hon. Friend's constituent's complaints about the way in which his case was handled, and ex gratia payments have been made to him in recognition of those failures. I am also told that arrears of maintenance that were wrongly paid have also been refunded. Perhaps I can discuss with my hon. Friend whether all those arrears have been refunded, because he raised the issue of amounts that do not tally.

My hon. Friend tabled four questions last summer about the operations of the CSA's independent case examiner, and he has corresponded with my ministerial colleagues on this case, with the most recent response having been sent last week.

My hon. Friend has raised a number of issues about the way in which the Child Support Agency handled his constituent's case, and I shall try to respond to those in general terms, but in particular to four key issues that the case highlights.

First, there were clear failures in keeping Mr. Reilly, and indeed my hon. Friend, informed about decisions of crucial importance in the handling of the case and subsequent inquiries. As many hon. Members know, the CSA has always had difficulties with clear and effective communication. That is partly because it uses a computer system that was already 20 years out of date when it was bought in 1990. As a consequence, it issues notification letters that pose more questions than they answer and could rarely be described as being written in a clear and understandable way.

There is a further failure on the part of the CSA to share information with other parts of the benefits system, which can make difficult cases even more confusing. That has happened in the case that we are discussing.

The changes to the decision-making provisions in child support, which we implemented in June 1999, gave us the opportunity to simplify and enhance the way in which the CSA communicates with its clients. In particular, the reasons for decisions are now explained more clearly, and parents should now have a much clearer understanding of how they can get a decision with which they disagree reconsidered.

The second point concerns the way that allegations of fraud and undeclared income are approached by the CSA. I am sure that my hon. Friend will appreciate that that is inevitably a difficult matter for an agency that has to amass the vast range of information needed to complete an assessment using the existing unwieldy child support formula.

Too often, parents come to the CSA already highly suspicious of each other and all too ready to believe the worst. Given that the CSA's involvement usually begins as a result of a claim to benefit by the parent with care, there is often suspicion on the part of the non-resident parent that benefit has been claimed fraudulently.

In the past, the CSA has simply passed such allegations to the Benefits Agency and failed to follow them up. However, that has changed since the Government took office. I can assure my hon. Friend that allegations of fraud are taken very seriously. All well-founded allegations of benefit fraud are investigated and further action is taken when appropriate.

That may take a little time and it is not always obvious to the person who has made the allegation that the suspect is under investigation. That may of course be frustrating for the parent concerned, but I hope that hon. Friend will understand that data protection principles do not allow the person who has made allegations of benefit fraud to be kept informed of progress with any investigation.

In the summer of 1998, the chief executive of the CSA, Faith Boardman, invited the benefit fraud inspectorate to inspect the agency and help to develop a security strategy. The resulting fraud and security strategy was published as part of its report. It included a number of specific commitments to support the Benefits Agency's fight against fraud, in particular by the introduction of better, streamlined fraud referral processes, clear service level agreements with the BA and better information sharing.

It should be remembered that, even if it is proved that benefit has been claimed fraudulently, maintenance liability might not be affected. That is because child support action that began with a claim to benefit does not cease automatically when a parent with care is found not to have been entitled to the benefit concerned. The simple fact of benefit being paid begins the child support process; it only stops after entitlement to the benefit has ceased and the parent with care asks the CSA to stop acting.

Thirdly, the case raises issues about the treatment of payments made between the parents and the interaction between such direct payments and the amount that the CSA seeks to collect if asked to do so by either parent. It is right that the CSA should, if asked to do so, seek to collect maintenance by the method that will best ensure that maintenance due becomes maintenance paid. When there is no agreement with the non-resident parent that ensures that maintenance will be paid, maintenance can, and should, be deducted directly from the non-resident parent's earnings.

That does not mean that the CSA can ever be justified in failing to ensure, before action of that sort is taken, that liability and any debts have been calculated properly; that the non-resident parent is given every opportunity to discuss alternative means of payment; and that any difficulties deductions from earnings may cause are considered sympathetically. Clearly, the handling of Mr. Reilly's affairs fell far short of acceptable in that respect.

We have already taken steps to improve the service that the CSA offers to non-resident parents. Longer opening hours and more use of the telephones mean that staff are available at times that suit working parents. In addition, the CSA is working with the private sector to improve compliance, to ensure that where possible parents do not fall into arrears with payments.

Fourthly and finally, Mr. Reilly's case highlights problems in getting tribunal decisions put into effect. Hon. Members will appreciate that, given the complexity of the child support formula, appeal tribunals are often not equipped to work out the new assessment when they allow an appeal. In the past, the tribunals were required to send all appeals that they allowed back to the CSA for action. That often entailed further investigation and long delays before people who appealed had their liability put right. Those delays simply added to the months that parents had had to wait for the appeal to be heard in the first place, thus piling frustration on frustration.

As I have mentioned, we have now changed the way in which child support decisions are made; we have also changed the way in which tribunals work. Delays in hearing appeals will be reduced and the way in which successful appeals are handled has been streamlined. Where necessary, the tribunal can still refer the assessment back to the CSA for determination; inevitably, that will continue to take time. However, where the tribunal can decide the issue under appeal, it will be free to do so.

We have all encountered such cases via our constituency postbags—I have dealt with some myself—and they are the main reason that we are determined radically to reform the agency. I understand my hon. Friend's concern that the agency has provided him with information that was wrong. There is no excuse for that, but the complexity of the current system substantially increases the risk of it happening, especially in connection with cases that go back many years.

Ever since the CSA was launched in April 1993, there has been a catalogue of complaints from parents with care who do not get the maintenance to which they are entitled, and from non-resident parents who have been let down by receiving a poor service. With hindsight, we can see that the problem lies with the way that the child support system was designed. The complex rules do not fit, either with the lives of separated families, or with other systems that provide support for those families.

Parents are left baffled and angry with a system that seems bureaucratic and insensitive to the very real difficulties that they face. When things go wrong, they can go very wrong indeed, as Mr. Reilly's case shows. The way in which the system operates too often adds to the tensions between parents, thus denying children a good relationship with both their mother and their father. Complexity leads to delay, which leads to maintenance debts as the non-resident parent's liability mounts waiting for the CSA to makes an assessment. That leads to anger and resentment all round.

That is why we plan to abolish the current scheme and replace it with a simple, more deliverable system that is focused on the needs of children and of good, responsible parents. Parents who face up to their responsibilities will receive a better service, whereas irresponsible parents will face effective and speedy sanctions.

As I said earlier, the case to which my hon. Friend referred has been the subject of an investigation by the CSA's independent case examiner. The agency takes complaints about its service very seriously and has developed a system to analyse them and to identify and correct the weaknesses that they reveal. For example, there is now an earlier recognition of clients' problems, and early efforts are made to put them right. More cases that reach the independent case examiner are resolved by an early resolution procedure that prevents the need for a full-blown and lengthy investigation.

The case which lies behind tonight's debate highlights problems of which we are all only too aware, many of which surfaced in the early days of the CSA. There have been substantial improvements in the agency's performance since then. As a result, the CSA has seen its numbers of complaints fall by more than 20 per cent. as compared with 12 months ago, at a time when its case load has increased by more than 20 per cent. The agency now has nearly a million cases on its books.

Ultimately, however, the only answer lies in radical reform. That is why we must introduce a new child support service with a simple, transparent and predictable formula for working out child support. In the reformed scheme, non-resident parents will know in advance what their maintenance liability is likely to be and can plan accordingly.

A more effective and efficient child support service coupled with the introduction of a £10 maintenance premium in income support and the 100 per cent. disregard of maintenance in working families tax credit will mean that more than 1 million children will gain, many of them seeing the benefit of maintenance for the first time.

The case that my hon. Friend has raised tonight underlines the need for reform, but that does not excuse the errors which have occurred. I am very sorry for the poor service that the CSA has given in this case. I will be happy to meet my hon. Friend to discuss it in more detail. I have asked the chief executive of the CSA to consider urgently whether adequate compensation is being paid to Mr. Reilly, especially in the light of the recommendation of the independent case examiner that substantial compensation should be paid. It must be borne in mind, however, that there are some constraints in this respect. The Government are determined to address these problems, and our reforms for child support are the right way in which to do that. In the meantime, we shall be looking to the CSA to learn the lessons from cases such as that raised tonight.

Question put and agreed to.

Adjourned accordingly at seventeen minutes past Ten o'clock.