Source · Select Committees · Public Accounts Committee
Recommendation 28
28
We therefore asked the Department about the affordability of payments.
Conclusion
We therefore asked the Department about the affordability of payments. The Department explained that its calculations were based on historical income, so “affordability is part of the calculation in that respect”. But it recognised that “the problem then comes when someone’s circumstances change and they no longer have the level of income that was assessed”.61 It explained that, while the amount due going forward may then have been reduced to take into account of the lower income, arrears may have built up that they cannot pay. The Department told us that, in response, “we just have to take a monitoring approach and keep under review the extent to which their circumstances change”.62
Government Response
Not Addressed
HM Government
Not Addressed
7. PAC conclusion: The Department’s ability to collect child maintenance is limited by the affordability of payments and the system risks creating a poverty trap for some Paying Parents. 7. PAC recommendation: As part of its Treasury Minute response, the Department should set out its plans to review the affordability of Child Maintenance Payments and the appropriateness of the current award calculations, including the earning thresholds. 7.1 The government disagrees with the Committee’s recommendation. 7.2 As referenced in paragraph 6.5 of HMT guidance, Parliamentary scrutiny of public spending, the department cannot set out its plans to review the affordability of liabilities in its response to the Committee as this relies upon a policy decision. 7.3 However, the department is considering its plans to review the affordability of Child Maintenance Payments and will update the Work and Pensions Committee in due course.