Child Maintenance Service

Stephanie Peacock Excerpts

Tuesday 23rd July 2019 Westminster Hall

[The Parliamentary Under-Secretary of State for Work and Pensions (Will Quince)]

It is a pleasure to serve under your chairmanship for the first time—and hopefully not the last, Sir Edward. I congratulate the hon. Member for Linlithgow and East Falkirk (Martyn Day) on securing this important debate on the Child Maintenance Service. I also thank hon. Members from both sides of the House for their contributions, which have been passionate, compelling and based largely on constituency cases. I know that, at the heart of it, everyone is driven by doing the right thing by the children involved.

I have met several hon. Members present to talk through some of the issues that their constituents have raised about the service. I have committed to making sure that we get things right first time. I also had the opportunity to hear directly from single parents during a recent visit to Gingerbread, where I heard at first hand about some of the important issues that they face.

Many points have been raised, so we have a lot to get through in a limited time. I stress that I hold regular surgery sessions, as many hon. Members present know, and I am happy to take offline any of the questions that I cannot cover in my response. I stress that I have been in post for just three months, and I would urge hon. Members across the Chamber not to underestimate my determination, while in this role, to improve the service.

I will start by setting out the Government’s approach. My Department is currently delivering a new child maintenance system, run by the Child Maintenance Service, which is designed to specifically address the shortcomings of the CSA.

[Stephanie Peacock (Barnsley East) (Lab)]

My constituent understood that his case with the Child Support Agency was closed on agreement in 2003, and there had been no attempt to collect any moneys for the past 16 years. It is only as part of this closure programme that my constituent has been contacted and asked to pay £30,000. Does the Minister share my concern that there has been such a big gap and no attempt to collect the money? There is also conflicting guidance implying that some CSA arrears incurred before July 2006 can be statute-barred. Will the Minister clarify that and meet me to discuss the matter further?

[Will Quince]

My door is always open to colleagues from both sides of the House, and I would be happy to meet the hon. Lady to discuss that particular case in detail.

I mentioned the shortcomings of the CSA, which did not provide the right support to parents and was expensive to run. We have learned from mistakes of the past: where the previous system often drove a wedge between parents by taking away their responsibility and choice, the new system encourages collaboration at every stage. We know that a constructive, co-operative relationship between separated parents has a direct positive impact on child outcomes such as health, emotional wellbeing and academic attainment—a point made by my hon. Friend the Member for Henley (John Howell). That is why, wherever possible, we support separated mothers and fathers to work together in the interests of their children and set up their own family-based maintenance arrangements.

Private family-based arrangements allow families to create flexible arrangements that work for their individual circumstances. Such flexible arrangements can include sharing of care, agreements over who will pay for essentials and treats, and financial transfers. They can change as the children grow and can help children to experience having both their parents take an active role in their lives.

We recognise that, post separation, the majority of parents want to continue to do the right thing for their children. We want to ensure that as many families as possible have an effective arrangement for maintenance in place; for those who are unable to make a private arrangement, the Child Maintenance Service provides the support of a statutory scheme. The Child Maintenance Service delivers a simplified statutory system with increased levels of automation, which allows cases to be processed much more quickly and with higher levels of accuracy than was achieved under previous schemes.

The CMS provides an effective, efficient service, to be used as a last resort where parents are unwilling to meet their responsibility to financially support their children voluntarily. This means that cases in the statutory service tend to be more difficult and relationships between the parents in these cases are often fraught and conflicted. While we continue to use all the tools at our disposal to maintain compliance and recover arrears, it is sadly inevitable that some arrears will accrue, as some parents go to great lengths to avoid their responsibilities. That is not acceptable and we are taking action to tackle it. Last November, this House approved regulations tackling a number of issues—closing down loopholes, introducing tough new sanctions for those who evade their responsibilities, and dealing with the historic arrears that built up under the Child Support Agency.

The hon. Member for Linlithgow and East Falkirk and my hon. Friend the Member for Stirling (Stephen Kerr) raised questions about the CMS’s performance. The Child Maintenance Service is performing well. The most recent statistics show that 94% of new applications were cleared within 12 weeks and 79% of change of circumstances actions were cleared within 28 days. We are seeing unprecedentedly high levels of compliance, with 67% of parents due to pay child maintenance through the collect and pay service having paid some maintenance in the quarter ending March 2019, up from 60% one year earlier.

Although the case load on the service has been growing steadily since it opened in 2012, the number of complaints and appeals received still represents less than 1% of that case load. We have continued to refine our processes to maximise compliance and debt recovery. Debt as a proportion of all maintenance arranged by the service has fallen since the launch of the 2012 scheme, from 17% in March 2015 to 11% in March 2019.

A number of colleagues, in particular my hon. Friend the Member for Stirling and the hon. Member for Motherwell and Wishaw (Marion Fellows), rightly mentioned customer service. The focus so far has largely been on tackling arrears and on recovery of debt, but my clear steer to officials is that I want the focus to be on customer services. We know that more than 80% of calls are answered, although I still think the 20% that are not is too many, and I want them answered in a timely fashion. My focus, while I remain in this role, will be on customer service.

A number of hon. Members raised the issue of enforcement, and we are taking far more action in that regard. We now have several court-based powers, including the use of enforcement agents, otherwise known as bailiffs, to seize goods, forcing the sale of the paying parent’s property. Approximately 7,100 paying parents in England and Wales are currently being pursued by civil enforcement agents for unpaid maintenance following a referral by the CMS.

Hon. Members also mentioned that the service can apply to have the paying parent sanctioned—by being committed to prison or disqualified from driving, for example. In addition to that, in regulations in November last year we launched the ability to disqualify non-compliant parents from holding a UK passport, which we believe will act as a strong deterrent. The service initiated 900 sanctions in the quarter ending March 2019 as a last resort against non-compliant paying parents.

The hon. Member for Strangford (Jim Shannon) raised the question of complex earners. We are aware of a small number of parents whose maintenance liability is inconsistent with their financial resources. Some choose to support themselves via a complex arrangement of assets rather than taking a salary. We are taking action to address that.

Parents can request a variation so that most forms of taxable income can be taken into account in the maintenance calculation, which will make it harder for individuals to avoid their responsibilities by minimising the amount of child maintenance they pay. The new powers that we introduced last year allow us to target complex earners via a calculation of notional income based on assets. In addition to the gross annual income provided by Her Majesty’s Revenue and Customs, we can capture income derived from property, savings and investments, including dividends, and other miscellaneous income. We also have the Financial Investigation Unit, which can investigate those parents who declare suspicious earnings or, where appropriate, refer to HMRC for tax fraud.

The FIU was first introduced in 2014, and since 2017 we have tripled the number of staff in that unit. It will look at any case where the receiving parent raises a concern over income and provides basic evidence to support it. I should stress that around 60% of FIU cases show no evidence of suppression of income. Nevertheless, it is an important part of the service. The hon. Gentleman also referred to the self-employed, which I suppose is similar to the situation of complex earners. We have new powers, enabling us to do deep-dive exercises and get to the bottom of cases where individuals are trying to suppress or disguise income. Perhaps I will meet him separately to go through that in a little more detail.

My hon. Friend the Member for Henley raised a number of points about the accuracy of CMS assessments. The accuracy of maintenance assessments has significantly improved; our annual client fund account shows that it is at 99%. Furthermore, the National Audit Office has not qualified CMS accounts for the past two years, which represents a significant improvement.

The hon. Members for Ellesmere Port and Neston (Justin Madders) and for Motherwell and Wishaw brought up the 25% threshold. I understand the concerns that they have raised. The point of the 25% threshold is to ensure that maintenance calculations are relatively stable, so both clients know what to expect in terms of payments. It also ensures that both parents are able to budget with certainty and provide ongoing maintenance for the child. I have met with the hon. Member for Motherwell and Wishaw to discuss this, and it is important to stress that most people’s income does not change to that degree over the course of one year.

My hon. Friend the Member for East Renfrewshire (Paul Masterton) and the hon. Member for Ellesmere Port and Neston—

Inequality and Social Mobility

Stephanie Peacock Excerpts

Wednesday 12th June 2019 Commons Chamber

[Stephanie Peacock (Barnsley East) (Lab)]

Only 9% of kids on free school meals in Barnsley go on to university. Does my hon. Friend share my view that that is absolutely outrageous and that we need such things as the education maintenance allowance back under a Labour Government to change that?

[Margaret Greenwood]

My hon. Friend makes an absolutely crucial point and it is important that young people in Barnsley get the support that they need.

Oral Answers to Questions

Stephanie Peacock Excerpts

Monday 13th May 2019 Commons Chamber

[Guy Opperman]

It was a great pleasure to visit Barrhead with my hon. Friend and meet his outstanding credit union, which is one of 1,290 employers providing 5,000 employees across his East Renfrewshire constituency with automatically enrolled pensions. It is a cross-party success story, with 10.4 million people now automatically enrolled.

[Stephanie Peacock (Barnsley East) (Lab)]

If it is true that work is the best route out of poverty, why did food banks in Barnsley give out more than 1.5 million food parcels last year, many to people in work? Why is it that in the Secretary of State’s own constituency low income has overtaken benefit delays as the biggest reason people are referred to Hastings food bank?

[Amber Rudd]

I am aware of the challenges faced by people on low incomes, which is why I am focusing on making sure that there is better access to higher-paid jobs. I am working on a number of projects with jobcentres across the country to see what we can do to get better training for people, setting up projects relating to job switching, and working particularly with employers in the local area so that they can get more involved and recognise that there are opportunities for them to promote people and give better training to those on lower incomes to get them into higher-paid jobs.

Oral Answers to Questions

Stephanie Peacock Excerpts

Monday 19th November 2018 Commons Chamber

[Amber Rudd]

I thank my hon. Friend for reminding the House of the tremendous benefits of universal credit and the tremendous advantages of an economy that is growing and providing so much new work for our constituents. Yes, of course universal credit has an important part to play in delivering those advances.

[Stephanie Peacock (Barnsley East) (Lab)]

In March, I wrote to the DWP regarding a systematic error in the housing element of universal credit that was incorrectly deducting £70 from claims. I was assured that the fault was known and the fix was on its way, but eight months later my constituents are still having their money taken. When will the Government sort out this mess?

[Alok Sharma]

If the hon. Lady would like to have a discussion about this case, I will of course look into it. Quite a lot of the time, I find that when Opposition colleagues raise issues, they do not always follow up with the individual cases. I hope that on this occasion, she will do so.

Universal Credit

Stephanie Peacock Excerpts

Tuesday 13th March 2018 Commons Chamber

[Angela Rayner]

Thank you, Madam Deputy Speaker.

The Government are phasing out childcare vouchers as they transition to a policy of tax-free childcare, but that policy is simply not working. The introduction of tax-free childcare has been so shambolic that the Government fell 90% short of their take-up target, and spending was less than 5% of their projection. Instead, nearly £1 billion that was earmarked for childcare was returned to the Treasury. Yet the Government are still pushing ahead with their plan to phase out childcare vouchers, which will leave families hundreds of pounds worse off and directly transfer Government support to those who are better off.

[Stephanie Peacock (Barnsley East) (Lab)]

My hon. Friend may have seen written answers I have received from the Government showing that 10,000 of their own officials still use childcare vouchers, and the same number are signed up to a Ministry of Defence scheme. Does she agree that if Ministers will not protect their own officials, they should at least stand up for our armed forces?

[Angela Rayner]

I absolutely agree with my hon. Friend. The armed forces do a magnificent job for us and it is an absolute scandal that they will also be caught up in this and made worse off as a result of these measures.

Members from all parties will know that hundreds of their constituents have written letters and signed petitions to express their concerns about these policy changes, yet the Government continue to push ahead with them, and have tried to do so by the stroke of a ministerial pen. The only legislation that has come to this House is the regulations before us, which complete the phase-out for those who change employers after April. We have therefore called for a vote on the regulations, and we want to make it clear that if the House passes our motion, we are sending a clear message to the Government that it is time to think again and keep childcare vouchers available.

The regulations on universal credit apply new sanctions to those who are currently protected and cut the time period that claimants have to provide evidence. Despite the Government’s rhetoric on people with disabilities and mental health needs, it will be them who suffer. Charities have urged the Government to reconsider, with Mind saying that the regulations will

“make the system harder to navigate at a time when people are unwell and most in need of support.”

Why is the Secretary of State for Work and Pensions ignoring those voices and making the system even harder for the very people the Government claim they want to support?

Self-employed people are the absolute bedrock of our economy. The Chancellor spoke of start-ups and new businesses in his statement earlier, but this legislation will make things harder for self-employed people. The TUC warns that a short start-up period for the minimum income floor could close businesses with the potential to become sustainable and profitable. The rules could discourage people from self-employment entirely. So, again, why is the Secretary of State making things so much harder for the people her Government claim to support? We know that the self-employed are more likely to be on lower earnings than employees, yet in its recent welfare trends report, the Office for Budget Responsibility confirmed that the low-paid self-employed face a much tougher benefits system under universal credit. On average, those affected are set to lose around £3,000, so the savings seem to be coming from the pockets of the low-paid self-employed. Why is the Secretary of State pursuing a policy that will make so many self-employed people much worse off?

The regulations make the universal credit system even more complicated, with the introduction of the surplus earnings rule. As universal credit is based on the previous month’s income, a self-employed claimant could get substantially less universal credit than an employed claimant earning a similar annual income. Successive Secretaries of State for Work and Pensions have said that universal credit will be simpler and will make work pay, but once again they are proposing the opposite.

All these statutory instruments share a common theme: they are about the support that we offer to families and their children, particularly those already struggling to get by. I remember when the Prime Minister said that the mission of her Government was the acronym JAMs—I am starting to think that really it stood for “Just about May’s survival”. It was meant to be about those who are just about managing, yet under this Government, there will be JAMs today and there will still be JAMs tomorrow, because instead of helping them to get on and get by, the Government are making their lives ever harder. Today is a chance to say that enough is enough. I commend the motions to the House.

Work Capability Assessments

Stephanie Peacock Excerpts

Wednesday 13th December 2017 Westminster Hall

[David Linden]

I know that the Minister is respected across the House for listening; I am sure she will have heard that point, and I hope the hon. Gentleman gets an answer to it in the wind-ups.

Finally, I will touch on the impact of assessments, frequent reassessments and poor decision making on the physical and mental health of claimants. We could easily spend the next hour and a half trading statistics across the Chamber, but I prefer to focus on real people and those whom I have been elected to represent. Throughout my short time as Glasgow East’s MP, I have seldom had a surgery in which a constituent has not come to me having been the subject of a flawed work capability assessment.

One such case was that of my constituent, David Stewart from Baillieston. David suffers from hidradenitis suppurativa and has had numerous abscesses over the years requiring extensive surgery and skin grafts. It is not uncommon, at times, for him to receive morphine up to six times a day. His own general practitioner stated clearly that David should not be working, yet he was found fit for work at a work capability assessment. It was only after my office intervened and helped him draft a mandatory reconsideration that that decision was finally, and justly, overturned. That brings me to the first issue I want to raise with the Minister today: the astonishingly high level of successful appeals against work capability assessment decisions.

[Stephanie Peacock (Barnsley East) (Lab)]

In my constituency, two thirds of residents who are initially rejected for PIP and ESA are shown to be eligible on appeal. Does the hon. Gentleman agree that that suggests the whole work capability system requires much more reform?

[David Linden]

The hon. Lady makes a good point; I very much agree.

The latest quarterly release on appeals of work capability assessments shows that 59% of decisions are overturned at appeal. To be blunt, that means that six in every 10 decisions are wrong. That is incredibly alarming.

There is, of course, a wider point about the undertaking of work capability assessments by a private sector provider, which I oppose on ideological grounds—I agree with the hon. Member for Coventry South (Mr Cunningham) on that point. I doubt, therefore, that it will come as much surprise that I very much welcome the commitment by the Scottish Government to ban private firms from carrying out benefit assessments. I wholly concur with the Scottish Social Security Minister Jeane Freeman, that

“profit should never be a motive nor play any part in assessing or making decisions on people’s health and eligibility for benefits.”

Over and above my ideological objection to private sector provision, I am sure that all hon. Members will be concerned to note that, according to the DWP’s own data released only last week, the ESA assessment provider has consistently failed to meet the contractual expectation for the quality of assessment reports.

Work, Health and Disability

Stephanie Peacock Excerpts

Thursday 30th November 2017 Commons Chamber

[Mr Gauke]

I am grateful to the hon. Gentleman for raising that case. I agree that that does not in any way sound like a sensible situation. The good news I can give him is that such a situation will not happen once universal credit is brought in.

[Stephanie Peacock (Barnsley East) (Lab)]

One of the major concerns of disabled people in my constituency is about the impact of universal credit. I note that in the right hon. Gentleman’s statement last week, he postponed the roll-out of universal credit in his constituency and those of the Prime Minister and the First Secretary of State. As he is in the mood to reconsider the policy, will he do the same and pause the roll-out of universal credit for the people of Barnsley East?

[Mr Gauke]

The previous question provided an example of how universal credit will actually be much better for disabled people. We are rolling out universal credit in a way that is safe, and we are making adjustments as and when we need to, but I am pleased to say that the date on which universal credit will be fully rolled out remains unchanged—March 2022. If it could be earlier, I would make it earlier, but that is the safest point at which we can do it. As I have said, universal credit will be an advantage for many disadvantaged people, because they will not be faced with some of the current disincentives, such as not working more than 16 hours a week.

Oral Answers to Questions

Stephanie Peacock Excerpts

Monday 9th October 2017 Commons Chamber

[Damian Hinds]

I return to what I said earlier: with universal credit, we are improving the incentives to work. This has to be seen in the context of the previous system, where far more people would face considerably higher marginal withdrawal rates. This important reform means that people can always see that they are better off going into work and, once there, they can see that they are better off always progressing in work.

[Stephanie Peacock (Barnsley East) (Lab)]

I find the Minister’s previous response surprising because a response to a recent written question showed that about two thirds of decisions against awarding PIP and ESA in Barnsley East are eventually overturned on appeal, with these appeals taking an average of 15 weeks to be decided. Does the Minister believe that it is acceptable to make my constituents who are eligible for vital financial assistance wait nearly four extra months?

[Penny Mordaunt]

No. That is why we are trying to get better decisions earlier in the process. We have made progress. As I said, the number of PIP cases going to appeal has fallen by 22% over the last quarter. We will continue—