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511.Paragraph 2 replaces reference to ‘net’ weekly income with ‘gross’ wherever it occurs in Part 1 of Schedule 1 to the Child Support Act 1991. This change means that where a calculation of liability is currently based on the net weekly income of a non-resident parent, in the future it will be based on their gross weekly income.

512.Paragraph 3 replaces paragraph 2 of Schedule 1, to amend the basic rate of maintenance. Basic rate is a percentage of the non-resident parent’s income and the changes will be:

• for one qualifying child – from 15% to 12%;

• for two qualifying children – from 20% to 16%; and

• for three or more qualifying children – from 25% to 19%.

513.Sub-paragraph (2) of paragraph 2 makes provision for a new rate for non-resident parents whose weekly income exceeds £800. The basic rate in these circumstances will be an aggregate of an amount resulting from the percentages above for the first £800, and an amount resulting from the percentages below for earnings over £800:

• for one qualifying child – 9%;

• for two qualifying children – 12%; and

• for three or more qualifying children – 15%.

514.Sub-paragraph (3) amends the percentage rate for non-resident parents who have one or more relevant other children. In these circumstances before the percentages above are applied, gross weekly income shall be reduced by a certain amount. Changes to these amounts will be:

• for one relevant other child – 15% to 12 %;

• for two relevant other children – 20% to 16%; and

• for three or more relevant other children – 25% to 19%.

515.Paragraph 4 amends sub-paragraphs 3(3), 4(1) and 7(7) of Schedule 1. The effect of these provisions is to increase the amount of flat rate maintenance paid by non-resident parents in receipt of benefit, or earnings lower than £100 per week, from £5 to £7 per week and apply the same increase to the minimum amount of liability due under the basic or reduced rates.

516.Paragraph 5 inserts a new paragraph 5Ainto Schedule 1 to the Child Support Act 1991. It also amends paragraph 1(1) of that Schedule, so that paragraph 1(1) is subject the new paragraph 5A.

517.The new paragraph 5A will makes provision for circumstances where a non-resident parent, in addition to their obligations under the statutory scheme, pays maintenance for a child or children under an existing private arrangement of a prescribed description or court order.

518.Currently, all children would normally need to be brought into the statutory scheme for them to be accounted for in a maintenance calculation. This change will mean that the Commission will consider any children who are subject to certain types of private maintenance arrangements, when calculating a basic or reduced rate maintenance liability under the new arrangements.

519.Sub-paragraph (2) of new paragraph 5A sets the weekly rate of child support maintenance for cases that fall within paragraph 5A at the greater of £7 per week and the amount calculated in accordance with sub-paragraphs (3) to (5).

520.Sub-paragraphs (3) to (5) make provision for the calculation of child support maintenance where the non-resident parent is party to a qualifying private child support maintenance arrangement. Liability is calculated as though all the children supported by the non-resident parent, by virtue of a qualifying maintenance arrangement, were subject to the statutory scheme.

521.Sub-paragraph (6) makes provision for the types of arrangement that will be ‘qualifying maintenance arrangements’ for the purposes of paragraph 5A.

522.Paragraphs 6 to 8 amend paragraphs 7(2), 8(2) and 9 of Schedule 1 to the 1991 Act, which allows for a reduction to basic or reduced rate where a shared care arrangement is in place. These changes will allow regulations to provide for a reduction on the basis of an agreement between the parents as to shared care. Regulations can also allow the Commission to work on the basis of an assumed pattern of shared care with a corresponding reduction on an interim basis. The intention is to use this where there is an agreement to share care, but no agreement as to the pattern or amount of shared care.

523.Paragraph 9 amends paragraph 10 of Schedule 1 to the Child Support Act 1991 to provide that, regulations about the manner in which gross weekly income is determined may provide that gross weekly income may be income from a past period.

524.This change will mean that where currently weekly income is based on information currently obtained from the non-resident parent, in the future it can be taken directly from information supplied by HMRC and based on previous income tax years.

525.Paragraph 10 increases the maximum amount of weekly income that will be taken into account for calculating maintenance, from £2,000 to £3,000 per week.

Schedule 5: Maintenance calculations: transfer of cases to new rules

526.This Schedule provides for arrangements to be made with regard to existing cases moving onto the new calculation rules. The Commission may require the parties to choose whether to remain in the statutory scheme under the new calculations rules. If they do not, then liability stops accruing under the scheme.

527.Paragraph 1 sets out that the Commission may require CSA clients on both existing CSA schemes, to choose whether to remain in the statutory scheme.

528.Paragraph 2 enables the Secretary of State, by regulations, to make provision about the power referred to in paragraph 1. The regulations may include, for example, provision about timing, stages and in which order cases will be transferred.

529.Paragraph 3 provides regulation-making powers to the Secretary of State in relation to how the parties exercise their right to choose whether or not to stay in the statutory scheme, and how they apply to stay within the statutory scheme.

530.Paragraph 4 stipulates that where either of the two parents chooses to remain in the statutory scheme, the case will remain in the statutory scheme, even if the other parent wishes to opt out.

531.Paragraph 5 sets out the effect of the Commission requiring the parties to exercise a choice under paragraph 1. If a calculation (or assessment under the old scheme) is in force, then maintenance will stop accruing from a date specified in regulations. If there is an outstanding application for maintenance calculation or assessment, it may be made only in respect of the period up to that date.

532.Paragraph 6 provides regulation-making powers to the Secretary of State in relation to a person’s decision not to leave the statutory scheme. These regulations may include provision about how an application to stay in the statutory scheme is determined, how the Child Support Act 1991 in relation to a maintenance calculation is to apply to such an application, and whether any adjustment is required to the resulting calculation. They may also include provision for treating an existing application as withdrawn where no maintenance calculation or assessment has been made.

533.Paragraph 7 sets out definitions for the purposes of moving of cases to the new calculation rules.

Schedule 6: Use of information

Powers in relation to use of information

534.This Schedule sets out gateways for the supply of information between the Commission and certain government departments.

535.Paragraph 1 enables information held in relation to child support functions by the Commission, or a person providing services to the Commission, to be used by or disclosed to any person providing services to the Commission for use for the purpose of functions relating to child support.

536.Paragraph 2 allows information relating to income tax, contributions, tax credit, child benefit or the guardian’s allowance, held by HMRC or a person providing a service to them, to be disclosed to the Commission or any person providing services to the Commission for use for the purpose of functions relating to child support.

537.Paragraph 3 concerns information held by the Secretary of State, or a person providing services to the Secretary of State, which relates to social security, or employment or training. It enables such information to be disclosed to the Commission or a person providing services to the Commission, for use for the purpose of functions relating to child support.

538.Paragraph 4 concerns information held for purposes relating to social security, child support or employment training, by the Northern Ireland Department or a person providing services to them. It enables such information to be disclosed to the Commission or a person providing services to the Commission, for use for the purpose of functions relating to child support.

539.Paragraph 5 concerns information held for use for the purpose of functions relating to child support, by the Commission or a person providing services to it. It enables such information to be disclosed to the Secretary of State, HMRC or the Northern Ireland Department or a person providing services to any of them, for purposes of certain functions.

540.Paragraph 6 defines the Northern Ireland Department as meaning the Department for Social Development in Northern Ireland or the Department for Employment and Learning in Northern Ireland.

Schedule 7: Minor and consequential amendments

541.This Schedule contains amendments which are minor or consequential on the measures in the Act. In particular the Schedule provides for amendment to the Child Support Act 1991, the Social Security Administration Act 1992, the Social Security Act 1998 and the Tax Credits Act 2002.

542.Section 20 of the Child Support Act 1991 is amended to provide for an appeal to the appeal tribunal against the making of a liability order by the Commission under the new section 32M. An appeal will lie on limited grounds, that is, that the person has not failed to pay an amount of child support maintenance or that the amount of the liability order exceeds the amount owing. In deciding any appeal against the making of a liability order, the appeal tribunal will not be able to question the maintenance calculation in relation to which the order is made.

543.Section 50 of the Child Support Act 1991 is amended so that the offence of unauthorised disclosure of information covers members and staff of the Commission, employees of those providing services to the Commission and those employed in employment of a kind prescribed in regulations. The latter could include, for example, employment with a credit reference agency.

544.Section 108 of the Social Security Administration Act 1992 is amended to include the definition of a maintenance order. The equivalent definition is currently contained in section 107 of that Act, but the repeal of this section is provided for in Schedule 8 to this Act. Section 121E is also amended in consequence of the transfer of functions relating to child support from the Secretary of State to the Commission. Information supplied by HMRC to the Secretary of State will no longer be provided for the purposes of functions relating to child support. This information will now be provided to the Commission.

545.Section 3 of the Social Security Act 1998 is amended to remove references to child support pertaining to the use of information held by the Secretary of State or the Northern Ireland Department.

546.Section 81 is amended to remove the responsibility for the Secretary of State to report on the standard of decisions made following appeals regarding child support maintenance. This responsibility will fall to the Commission.

547.Schedule 5 to the Tax Credits Act 2002 is amended in consequence of the transfer of functions relating to child support from the Secretary of State to the Commission. Information supplied by HMRC to the Secretary of State will no longer be provided for the purposes of functions relating to child support. This information will now be provided to the Commission.

Schedule 8: Repeals

548.This Schedule provides for repeals consequential on the provisions of the Act.

Commencement

549.The following provisions will come into force on Royal Assent:

• section 55;

• subsection (8) of section 59;

• section 61; and

• section 63.

550.Section 35 (relating to Scottish maintenance agreements) will come into force on the day after the day of Royal Assent. The remaining provisions come into force on such days as the Secretary of State may by order appoint.

Hansard References

The following table sets out the dates and Hansard references for each stage of the Act’s passage through Parliament.