New child maintenance charges
New child maintenance charges
From Monday August 11th, parents using the government’s Child Maintenance Service’s ‘Collect & Pay’ facility to pursue their former partners for child maintenance will lose a percentage of each payment. Under the changes, individuals registered as parents with care (PWCs) will see 4% deducted from their instalments while the partner paying the maintenance, non-resident parents (NRPs), will have to pay a 20% surcharge.
The Government says that the introduction of the fee is designed to push separated couples to come to their own financial arrangements. The change is part of plans to phase out the Child Support Agency and phase in the Child Maintenance Service.
Non-payment of child maintenance worries
It is estimated that at present there are 2.5 million separated families with children in the UK. Some 1.4 million of these are outside the Department for Work and Pensions system, either making their own arrangements, going through the courts or just cutting off contact.
The new maintenance system is thought to have worried many PWCs who are concerned about the charges. A major concern among mothers is that NRPs may just stop paying, leading to them having to endure months of non-payment before the Child Support Agency’s enforcement powers can be used to try and collect payment.
Responding to criticisms that many mothers will feel aggrieved about the 4% reduction in the maintenance they receive, Stephen Webb, the Liberal Democrat minister responsible for implementing the scheme, says: “For that 4 pence in the pound you are getting a much better service. This will improve people’s quality of life.” He noted that one of the benefits of the new system is that it will see NRPs’ income information picked up automatically from Her Majesty’s Revenue and Customs, meaning that payments can be calculated, in most cases, “in days, rather than weeks”. The news system will also see income data updated automatically each year leading to PWCs receiving an annual increase in maintenance payments in line with the pay rises their former partners are getting.
IBB Solicitors commented,
“I would not hold my breath that the CMS will be better than the CSA – but it certainly cannot be worse. It does seem unfair to the PWC that any charge will be levied when I expect the only reason they have gone to the agency is because they expect difficulties and possibly non-payment from the NRP”.
Further background of the Child Support Agency
As part of the reforms to child maintenance, single parents in England, Scotland and Wales should have been issued letters informing that the Child Support Agency is closing and being replaced by the Child Maintenance Service.
On the 30th of June 2014, the Child Support Agency begun the process of closing its cases, with parents whose cases are being closed given 6 months’ notice of the closure.
The first cases being closed are those relating to parents who have been “nil-assessed”, cases where the other parent does not have to pay child support. After that the Child Support Agency will begin to close those cases in which no money is being paid and where the CSA is not trying to enforce the payments.
Anyone who has their case closed will have to apply to the Child Maintenance Service should they require assistance collecting child maintenance.
For parents receiving money through the Child Support Agency it is unlikely that their cases will be closed before 2015.
An alternative secure solution
Many parents choose to reach a voluntary agreement as to what should be paid in the way of child support. It is recommended that any such agreement is formalised in writing under the guidance of a family law specialist, thus allowing it to be enforced by either party.
Parents who wish to avoid the ongoing charges where maintenance is to be dealt with by the new Child Maintenance Service should explore the possibility of entering a voluntary, enforceable agreement for the payment of child support
If you would like to discuss any aspect of family law, are considering divorce proceedings or a trial separation, or want to draw up a pre or post-nuptial agreement, call us in absolute confidence on 01494 790058 or 01494 790047. Alternatively, email us at familylaw@ibblaw.co.uk.
