§ Mr. Waldegrave
asked the Secretary of State for Social Services whether he is aware of the growing practice of maintenance for children being made payable to the children rather than to the mother so as to increase the amount of supplementary benefit payable to the mother; and what action the Supplementary Benefits Commission proposes to stop the resulting loss to public funds.
§ Mr. Prentice
The chairman of the SBC has told me of the Commission's concern about recent developments in cases where maintenance for children is expressed as payable to the children. Prior to July 1976, in assessing a family's entitlement to supplementary benefit, the requirements and resources of a child under 16 were normally aggregated with those of the parent he lived with. But from that date the Commission decided to exclude both the child's requirements and his resources where a maintenance payment exceeded his scale rate and was payable to him—as opposed to being payable to the parent. This change was made in the light of a Court of Appeal judgment which interpreted the law on aggregation in the context of a case relating to damages under the Fatal Accidents Acts, which did not involve maintenance payments.
Since then the number of such cases has increased and some maintenance payments have clearly been artificially arranged in order to increase the amount of benefit payable. The Commission has, therefore, reconsidered its policy and has decided to revert to its former practice of taking maintenance payments in these circumstances fully into account against the requirements of the family.112W
I strongly support this decision. Continuing the former practice would have led to an increasing number of cases of inequity, with gross differences between claimants who could arrange their incomes in this way and others who could not. This inequity would have arisen from a notional allocation to a child of income that in real life was available to the whole family. The loss to public funds would have reached something like £10 million a year within two or three years.
Claimants in receipt of benefit already assessed under the policy that is now being changed will not have their benefit reduced as a result of the change. It will stay at its present level until other changes take place and the amount payable is increased to a higher level.