Welfare Reform Bill

My Lords, clearly I am very aware of the strength of feeling that has featured in previous debates on child maintenance, and I look forward to hearing the views of noble Lords today. Perhaps I may start from a rather different position from the one I took in the debate when we last looked at this issue. I shall quote the right honourable Frank Field, who is an acknowledged expert in this area. Even though he sits on a different side, he makes a point that is absolutely smack-on. He said: "““Is not the really big change that we are discussing the fact that when the CSA was first established, the maintenance moneys went to the Treasury to offset what taxpayers were putting up because, generally speaking, fathers were not prepared to do so, whereas now that money remains with the family? Is it not reasonable, in such circumstances, if people are going to get a top-up to their benefit that they should contribute to the cost of gaining that extra money? On the timing, should we not charge people once they are getting the money, not before?””.—[Official Report, Commons, 1/2/12; col. 910.]" That quote highlights the central point to the debate. We need to look at the proposed charges in the context of all the other financial support that the Government provide for lone parents. Child maintenance is only one aspect of that support. I have made some rough calculations to give noble Lords a sense of the relative orders of magnitude involved. In the 12 months to December 2011, the CSA collected or arranged maintenance of more than £1 billion. However, by far the largest amount of money going from the Government to support lone parents is through the benefits and tax credits systems. The benefits system provides well over £5 billion of support to lone parents, and the Government provide more than £10 billion of further support through tax credits. Thereby, the total support going to lone parents—a few lone parents are bereaved but the bulk, 95 per cent, are not—in either direct state funding or with funds from state mechanisms is well over £16 billion. Let us now look the other end of the telescope. What are we asking the parent with care to pay for collecting that extra money? By the end of the next spending review we will collect each year between £50 million and £100 million in collection charges from parents with care. Those figures are based on the 7 per cent to 12 per cent range of collection charges set out in the Green Paper. Let us take the figure of £75 million and compare it to the £16 billion of support that is being provided to this group, either directly or through the state. That ratio works out at less than one half of one per cent. I do not think that Barclaycard or other credit cards charge as little as that.