Source · Select Committees · Public Accounts Committee
Recommendation 31
31
The Department has no long-term strategy for tackling the growing unpaid maintenance balance under the...
Conclusion
The Department has no long-term strategy for tackling the growing unpaid maintenance balance under the current CMS scheme. Unpaid maintenance owed to parents on Collect & Pay has increased by more than £1 million per week to a total of £440 million as at October 2021.66 We therefore asked the Department how it planned to address the increasing arrears balance within the scheme. The Department told us that “a lot of it is already in payment” and it is “not giving up on getting all of it”.67 However, the NAO reported that no payment was made against around four-fifths (79%) of this debt in September 2021. It concluded that, unless the Department writes off more of the debt, outstanding arrears will grow to £1 billion by March 2031 at current rates, and indefinitely 59 Written evidence CMS0007, anonymised; Written Evidence CMS0040, anonymised; Written evidence CMS 0030, anonymised 60 C&AG’s Report, para 23.2.23 61 Q 79 62 Q 79 63 Q 80, 82; C&AG’s Report, para 2.3, 2.24 64 C&AG’s Report, paras 15, 1.16 65 CMS 0042 66 C&AG’s Report, paras 25, 2.29 67 Qq 85–86 and 88 Child Maintenance 21 thereafter.68 The Department told us it expected investment in transforming its services to give it 15% more capacity to focus on compliance. However, even if compliance rates improve the Department will only delay the date the level of unpaid maintenance reaches £1 billion to 2033–34.69 The Department also told us that it expected only a minority of debt to fall into a category it described as “at the moment, we can’t see how the parent can pay and we’re just keeping a watching brief.” However, the Department does not currently have legal authority to write off uncollectable CMS arrears and has yet to decide how to treat cases which it has identified where the money owed is ‘potentially uncollectable’ because it has exhausted its enforcement options.70 Fraud and error in maintenance payments
Government Response
Not Addressed
HM Government
Not Addressed
6. PAC conclusion: The Department is too slow to take effective enforcement action, leaving children without maintenance for too long and allowing child maintenance arrears to grow. 6. PAC recommendation: The Department should, within one year: • conduct operational and user research to better understand how customers progress through its collection and enforcement process, to identify any operational or legislative barriers to reducing the overall time to getting payments; and • in consultation with stakeholders, develop a strategy to tackle rising unpaid maintenance debt on its 2012 scheme, drawing on lessons learned from its experience of reducing CSA arrears, considering key barriers to compliance, such as affordability, and whether a write-off of uncollectable debt would be appropriate. 6.1 The government agrees with the Committee’s recommendation. Recommendation implemented 6.2 The department continues to complete extensive operational insight and analysis and utilises its existing user research. This provides insight into any barriers to compliance enabling the department to identify further opportunities for improvements for customers. 6.3 As reported by the National Audit Office, the department has improved its collection and enforcement activities and the amount it collects through Collect & Pay enforcing payments has increased. The department recognises the challenges it faces in removing some of the barriers to compliance and therefore continually reviews and evolves its compliance strategy. 6.4 Through its Transformation Programme the department will be developing its use of risk and intelligence within its business processes. This will involve improving the quality and the use of data to develop and deploy both tactical solutions for improving and accelerating day to day compliance and in helping to inform and develop a more efficient organisational and process design. This will link closely with embedding sustainable arrangements that take a balanced account of the customer’s circumstances. 6.5 The department is aware that the effectiveness of its compliance strategy is heavily influenced by existing legal processes and the current dependency on third parties (such as MoJ and Bailiffs). It is currently reviewing these dependencies and will provide an implementation approach for any changes by Summer 2023. 6.6 Through its Transformation Programme, the department is reviewing its internal processes and current organisational design structure to ensure cases can be transitioned through the customer journey more efficiently. 6.7 In addition, current policy work relating to ‘Transformation’ includes the drafting of regulations to extinguish low level debt (where appropriate) and expanding the list of organisations required to comply with requests from CMS for information or evidence.