Work and Pensions Committee open Child Maintenance Service inquiry

The cross-party Work and Pensions Committee has launched a new inquiry into the child maintenance payment watchdog which facilitates and enforces payments between separated parents to help pay for their child's day-to-day care. 

The inquiry will examine how to boost the Child Maintenance Service's effectiveness in increasing payment compliance rates, improve the way it deals with families, how maintenance payment levels should be set, and the impact of the Government's proposed changes to Direct Pay and Collect and Pay. 

Over 1 million children are in the CMS system, of which 760,000 are managed by them in cases where the parents have been unable to agree payments between themselves. A Department for Work and Pensions survey published in June says that around 2 in 5 of receiving parents report non-compliance with payments, while in 31% of Collect and Pay cases, impacting 70,000 receiving parents, no payments were made at all between January and March.  

The Government's proposals to abolish Direct Pay and reform Collect and Pay will also be scrutinised in the inquiry. Direct Pay is the current default plan where the CMS sets payment levels and schedules for parents who then organise payments privately but where the body does not have enforcement powers.  

Instead, cases will move to Collect and Pay, where the CMS acts as a middleman between paying parents. This process will undergo a fee restructuring to come into force in 2027-28. Compliant and receiving parents will be charged 2% of their child maintenance to use the service. Currently, charges are set at 20% for paying parents and 4% for receiving. 20% will remain the charging rate for paying parents who fail to comply with their payment plans.  

Committee Chair Debbie Abrahams said, “Millions of children and parents are served by the Child Maintenance Service which has a key role in ensuring mediation between parents, so that the best interests of the child are being met.” 

“However, there are concerns over how it calculates payments, how it handles people who have sometimes been through long ordeals, and over its enforcement. Increasingly, we're hearing as MPs from people about how unhappy they are with how they have been treated by the service. This applies to both paying and receiving parents.” 

“We will explore each of these topics to check the service's performance, but also to examine how improvements can be made, and we want to hear from anybody with expertise or experience of it.”    

“The start of the summer holidays comes with the extra costs of childcare, naturally bringing family finances into sharp focus. Ensuring the service is working effectively is essential as it would help alleviate some of the stress not just caused at this time of year.” 

Call for evidence and terms of reference 

If you wish to give evidence to the inquiry and you have the expertise or experience to answer any of the questions below, please visit the inquiry's evidence submission page and submit your answers before 16:00 on 6^th October. 

·         To what extent has safeguarding been considered in the design and delivery of the Child Maintenance Service (CMS)? How might a systems-based approach to safeguarding support the CMS and people who use it?2 

·         Are there any changes that could be made to the CMS to make the system less adversarial for parents? 

·         How can parents be supported to reach and adhere to Family-based agreements? 

·         If and when a child maintenance agreement breaks down between parents, how might they be supported to find a resolution? 

·         How adequate is the support provided by the CMS to Paying Parent, Receiving Parents, and victims of domestic abuse? How could this be improved? 

·         Is the Government's current approach to calculating Child Maintenance rates appropriate? How should child maintenance rates be calculated? 

·         How could child maintenance payment rates be calculated to prevent child poverty, and avoid creating poverty for parents? 

·         How can the CMS ensure it receives all the information it requires from parents to calculate rates? 

·         How can new legislation, determining Child Maintenance calculations, provide greater flexibility to allow governments to make changes where necessary? 

·         What are the benefits and drawbacks of the Government's plans to remove Direct Pay arrangements? 

·         What support will parents who move from Direct Pay to Collect and Pay require, to enable a smooth transition? 

·         What are the benefits and drawbacks of the Government's plans to charge a 20% fee for non-compliant parents? 

·         What other mechanisms could be used to help improve compliance with the CMS? 

·         Has the Department made any improvements to how it assesses fraud and error in the child maintenance service? 

·         Are there any groups of parents who find it particularly difficult to interact with the CMS? For which parents is the system not working? 

·         How quickly does the CMS respond to queries from parents and Members of Parliament? How might communications be improved? 

·         How effective is the CMS at complaint handling and complaint resolution 

ENDS 

Notes to editors 

·         The Child Maintenance Service offers three services: 

o    Family-based arrangements (FBA): where parents make an agreement privately. 

o    Direct Pay: CMS calculates maintenance and arranges a payment schedule, at which point the parents privately arrange payments.  

o    Collect and Pay: CMS calculates maintenance and collects and transfers payments from the paying to the receiving parent. Fees apply – 20% for paying parent and 4% for receiving parent. If maintenance due under Collect and Pay is not voluntarily paid, the CMS can take various enforcement measures. 

·         57% of all CMS arrangements use Direct Pay and 41% Collect and Pay (DWP)