On top of that – the Government is proposing that there are extra charges levied on maintenance, on a percentage basis. They have proposed that a percentage of between 15 and 20% is added to the maintenance that the NRP pays. The CSA would then take their cut, taking it back to the current level of maintenance. Then the CSA would take another percentage cut from the maintenance before they pay it out to the PWC. They have proposed that this will be between 7 and 12%. Which would leave the PWC with 7-12% LESS than they currently receive as maintenance.
What does this mean in real terms? There is a thread on Mumsnet that spells out the financial implications of this, for both the PWC and the NRP. Here are some of the posts that show how this would affect both PWC and NRP’s, and obviously, by default, how it would financially affect the children involved:
If the NRP has an income of 20K pa: Normal, current maintenance for one dc would be £57.75 per week.
Best case under new rules: NRP pays £8.66 per week more than now. RP receives £4.04 less per week than now. Government makes £12.70 per week.
NRP pays £66.41 a week.
RP receives £53.71 a week.
Worst case under new rules:
NRP pays £11.55 per week more than now. RP receives £6.93 less per week than now. Government makes £18.48 per week.
NRP pays £69.30 a week.
RP receives £50.82 a week.
So even if the NRP is only on 20k pa, the Government will be making between £12.70 and £18.48 EVERY WEEK. Which is between £660.40 and £960.96 A YEAR from EACH CHILD.
If the NRP has an income of 40K pa: Normal, current maintenance for one dc would be £115.35 per week.
Best case under new rules: NRP pays £17.30 per week more than now. RP receives £8.07 less per week than now. Government makes £25.37 per week.
NRP pays £132.65 a week.
RP receives £107.28 a week.
Worst case under new rules: NRP pays £23.07 per week more than now. RP receives £13.84 less per week than now. Government makes £36.91 per week.
NRP pays £138.42 a week.
RP receives £101.51 a week.
If the NRP is on 40k pa, the Government will be making between £25.37 and £36.91 EVERY WEEK. Which is between £1319.24 and £1919.32 A YEAR from EACH CHILD.
If the NRP is on JSA: Normal, current maintenance for one dc would be £5.00 per week.
Best case under new rules: NRP pays 75p per week more than now.RP receives 35p less per week than now. Government makes £1.10 per week.
NRP pays £5.75 a week.
RP receives £4.65 a week.
Worst case under new rules: NRP pays £1.00 per week more than now. RP receives 60p less per week than now. Government makes £1.60 per week.
NRP pays £6.00 a week.
RP receives £4.40 a week.
If the NRP is on JSA, the Government will be making between £1.10 and £1.60 EVERY WEEK. Which is between £57.20 and £83.20 A YEAR from EACH CHILD.
There are lots of people campaigning about this at the moment, including CSA Hell, NACSA, and Gingerbread.
Chapter Three: Moving to the New Child Maintenance System.
From 2012 all new applications will be made under the new Child Maintenance System, involving the Gateway process. No new applications will be taken under CSA or CMEC rules.
From the introduction of the new Child Maintenance System, a probation period of 6 months will be in place, during which no charges will be applied. This will allow any “teething problems” to be identified.
Around end 2011, into early 2012, existing CSA/CMEC cases will be issued with case closure letters, and details of the new Gateway procedure will be given. After a period of 3 months, the PWC will then have to decide which option they intend to take – either a private arrangement, or make an application to the new Statutory Service.
The new system of child maintenance will be administered by another brand new computer system, which will be linked to HMRC. The intention is to have more up to date access to the income of the NRP.
Cases will automatically be revised annually, ensuring maintenance is based on the most recent income information.
This is a paragraph from the NACSA document that I have linked to, showing that cases will be being closed VERY soon. This will give the PWC only 12 weeks to decide whether to go for a private agreement or have to pay to continue to use the collection service. Which some PWC will have no choice but to do. If they have been a victim of physical, emotional or financial abuse, having a private agreement is impossible. However, although there will be ‘exceptions’ for PROVEN Domestic Violence, emotional and financial abuse is notoriously hard to prove, and is unlikely to be covered by this rule. Which means that a woman who has left a relationship due to being emotionally or financially abused, will still have to pay to use the new CMEC to get maintenance from their ex-partner.
Often, a woman who has left a relationship due to emotional or financial abuse has an Ex-Partner that is what is called ‘non-compliant’. This means that he will NOT pay maintenance without being FORCED to by the CSA/CMEC. And because this parent is irresponsible, and wishes to avoid paying maintenance, the PWC will be charged for this. There is unlikely to be ANY protection for PWC in this situation. This is a travesty for Women’s Rights.
The government says the current Child Support Agency is expensive to run, costing 40p for every £1 collected. It admits the main savings from introducing charges will NOT be from money collected, which it says will raise only “a small proportion” of the running costs. Savings will come because charges will mean fewer people use CMEC’s child support scheme, making it cheaper to run.The government says: “For the majority of customers an application will be good value compared to the child maintenance that will be paid through a case. Given the long-term financial benefits of child maintenance we believe it is fair and in line with the principles of personal responsibility to ask parents to reallocate a small proportion of their spending so that they can afford an application charge.”
This is a paragraph from the Gingerbread document that was linked to earlier.
What this means is that the Government is actively trying to DISSUADE PWC from using the CSA/CMEC. Rather than trying to ensure that NRP’s take financial responsibility for their children, they are allowing them to shirk this responsibility by putting these barriers in place TO SAVE MONEY.
The ConDem Government do not care about the impact of this on Lone Parent Families. There will be another Blog post soon that expands on this issue, to tell you about the impact of the new Universal Credit on child maintenance.