Child Maintenance Service (CMS)

4. Mr L complains CMS seized money by way of a Lump Sum Deduction Order (LSDO) In October 2020. Mr L specifically complains that CMS: • agreed to give him extra time to provide evidence where the funds came from then acted before this time had elapsed • did not give Mr L the opportunity to appeal the LSDO or tell him how to do so • passed the funds to his ex-partner even though Mr L had told CMS the funds it had secured were from his student loan.

• did not deal with Mr L’s complaints promptly.

5. Mr L also complains the ICE investigation of his complaint was unjust and totally failed to address the serious failings of CMS.

6. Mr L says he suffered from financial and psychological harm due to the actions of CMS. He says he has lost £3899.26 that was money from his student loan. This meant he was forced to borrow further money and has put him further in debt. He also says that this triggered his mental health condition, which is still ongoing.

7. Mr L would like CMS to apologise for its errors. He would also like CMS to return the £3899.26 it took from his account. He would also like further financial remedy in recognition of the impact on him.

8. The full background in this case covers many years and covers several different changes in Mr L’s child maintenance liability. We have not set out the full background to all the issues here. We have set out the relevant information that relates to the issues we are considering in our decision.

9. Child maintenance is financial support that helps towards a child’s everyday living costs. CMS is the government’s statutory body that calculates, collects and enforces child maintenance payments for people who cannot make their own arrangements.

10. Mr L had a child maintenance case open between September 2010 and July 2017. When this case closed there was an arrears balance of £7,399.26.

11. Arrears in child maintenance can occur when the parent making payments fails to make the required payments in full and on time. Arrears can also occur due to a change in circumstances that leads to a change in the amount of child maintenance the parent is expected to pay.

12. Mr L’s ex partner (Ms A) made a new child maintenance application in October 2017. CMS used HM Revenue and Customs (HMRC) data to calculate Mr L’s maintenance liability. Mr L told CMS he was a full-time student with no income. CMS asked Mr L to provide evidence of his circumstances.

13. CMS added the arrears owed from the previously closed case to Mr L’s child maintenance liability. A review of his case completed in October 2018 showed CMS expected Mr L to pay £7 per week. This also confirmed the arrears Mr L owed stood at £7,399.26. If Mr L did not agree with how CMS had calculated this he had the right to appeal.

14. In March 2020 Ms A told CMS Mr L had not paid her enough child maintenance. CMS contacted Mr L and told him he should provide evidence of payments made to Ms A or it would change his case from direct pay to collect and pay.

15. Direct pay are payments made from one parent directly to the other without the need for CMS to be involved in the collection of child maintenance. Collect and pay is where the paying parent pays child maintenance to CMS who pass it on to the receiving parent.

16. Direct Pay is the standard starting point for most new applications. The benefit of direct pay is that there are no added fees to pay to CMS. If a case is collect and pay CMS charge fees to both parents for collecting child maintenance and managing the account.

17. If a parent does not make payments on time CMS can change the case from direct pay to collect and pay. When CMS change a case to collect and pay it can then take enforcement action to recover arrears owed.

18. As Ms A had reported Mr L had not made the required child maintenance payment, and Mr L did not respond to CMS when it contacted him about it, in April 2020 the case was changed to collect and pay. CMS wrote to Mr L and told him of the change and that his arrears now stood at £7,283.04.

19. Between April and September CMS contacted Mr L several times about his arrears and received no response from him. Due to Mr L now being non-compliant CMS started recovery action. As part of this action CMS contacted Mr L’s bank to identify if he had funds in his bank account.

20. In October CMS wrote to Mr L and told him it had sent an interim LSDO to his bank to secure a payment of £3,899.26 towards his arrears. It told Mr L to contact it within 14 days if he did not agree with the order.

21. Mr L did contact CMS and set out that he did not agree with the order. He told CMS the funds in his bank were from a student loan. CMS asked Mr L to provide evidence to confirm this.

22. As Mr L did not provide evidence of his student loan within the required timescale CMS then took action to make the LSDO a final order. Mr L had the right to appeal the LSDO final order.

23. In December as CMS had received no notification Mr L had appealed the LSDO it contacted his bank instructing it to comply with the final order and deduct money from his account and send this to CMS. CMS then paid this money to Ms A as it was a payment in relation to the arrears of child maintenance Mr L owed her.

CMS agreed to give Mr L extra time to provide evidence then acted before this time had elapsed.

27. Mr L told us that when he received notice that CMS had frozen money in his bank account he complied with the CMS complaints process and asked for the order to be disapplied.

28. When Mr L received the notice he called CMS and told it the funds in his bank account were from his student loan. As the statement form Mr L’s bank had not shown a deposit from student finance CMS asked him to provide evidence to show where the money had come from. Mr L agreed to provide this information.

29. Mr L told CMS he could not upload the information about his student loan so would have to send it by post. As Mr L had asked for more time CMS extended the time he had to respond by a further seven days. This meant Mr L needed to provide the evidence to CMS by 13 November. Track and Trace information provided by Mr L shows this letter was delivered to CMS on 16 November.

30. On 13 November as CMS had received no information from Mr L, and his seven-day extension had now passed, it made the decision to issue the LSDO final order.

31. On 16 November CMS wrote to Mr L and confirmed it had made a final LSDO on his account. This letter also set out that Mr L had 21 days to appeal the order and told him what he would have to do if he wanted to appeal.

32. On 26 November Mr L wrote to CMS setting out that he does not agree with its decision to issue the LSDO final order. He told it he had sent evidence and CMS had issued the final order before considering this.

33. We have considered the legislation that sets out CMS’s powers to issue a LSDO. This is set out in the Child Support (Collection and Enforcement) Regulations 1992. Section 25M of the regulations sets out what information CMS must include in the interim LSDO and who it must inform. This section sets out that the information should include the period for making representations.

34. In its letter to Mr L CMS told him he had 14 days to make representations to either change or disapply the order. CMS extended this by a further seven days when Mr L told it he had not been able to upload the evidence online. When the seven-day extension expired CMS made the final lump sum deduction order.

35. To consider if CMS acted correctly in finalising the LSODO we have considered guidance contained in the Child maintenance decision makers guide. Chapter 56 of the guidance covers Deduction Orders.

36. This guidance says that after CMS serve an interim order it will initially take no action to allow time for representations to be made. In this case CMS extended this by a further seven days. CMS did not take action to finalise the order until this time had elapsed.

37. The guidance also says that if the parent does not dispute the order within the timescale, it will serve a final order. This is what CMS did in this case. The guidance also says that that there is no right of appeal against an interim LSDO, you can only appeal against the final LSDO.

38. We understand Mr L believes the information sent was in time and CMS should have considered it. With the extension of seven days Mr L would have needed to have made any representations by 13 November. CMS received the letter Mr L sent on 16 November. Which was outside the timeframe for him to make representations. As such CMS did not act before the timeframe for Mr L to make representations had elapsed.

39. There are no indications that CMS failed to follow the relevant legislation and guidance when it acted to serve the final LSDO. As this is the case we will take no further action.

CMS did not tell Mr L how to appeal the LSDO

40. Mr L told us that CMS never told him how to appeal against the LSDO. He said if CMS sent a letter that contained this information, he never received it.

41. CMS issued a letter to Mr L setting out the final LSDO on 16 November. This letter contained information on his right to appeal. The letter said appeals can only be made to the family court using form N161 appellant’s notice.

42. On 9 December CMS sent Mr L a letter setting out that the representations he made were outside its time limit, even though it had extended this by seven days. The letter acknowledged Mr L had provided information for it to consider but as this only arrived after the time to make representations had passed it did not consider the information he sent. This letter also set out Mr L’s right to appeal the final order.

43. CMS systems confirm both letters were issued and neither of the letters were returned to CMS as undelivered. As this is the case CMS will presume that the letters have been received.

44. Regulation 7(2) of the Child Support Maintenance Calculation Regulations 2012 sets out the requirement for CMS to send a decision by post. It says CMS must send a decision by post and it treats a letter as given the second day after it posts the letter. There is no requirement for CMS to send the notice recorded delivery or prove that it was delivered.

45. CMS sent two letters to Mr L setting out his appeal rights, and it followed the regulations above by sending the letters in the post to his last known address.

46. There are no indications that CMS failed to follow the relevant legislation and guidance when it informed Mr L of his appeal rights. As this is the case we will take no further action.

CMS passed funds to Mr L’s ex-partner that were from his student loan.

47. Mr L told us that he does not believe CMS should have given the money seized from his bank account to his ex-partner while he was still disputing it.

48. As explained above CMS gave Mr L the opportunity to provide evidence that the money frozen in his bank account was his student loan. When Mr L did not provide the evidence in time CMS made the LSDO a final order.

49. The guidance contained in Chapter 56 of the CMS Decision makers guide sets out that it will only request money from the bank or building society after the appeal period has passed. CMS only received the money from Mr L’s bank account once it confirmed he had made no appeal.

50. By the time CMS requested the money from Mr L’s bank it had confirmed Mr L had not made representations in the required timescale and had not appealed the final LSDO.

51. CMS distinguishes between a formal legal appeal and an administrative complaint. An appeal would suspend the action to seize the funds from the bank, in line with the relevant legislation. However, making a complaint does not stop the enforcement of a debt. If Mr L wanted to stop CMS taking the money from his bank account he would have had to appeal the decision, which he did not do.

52. As the time limit to appeal the final LSDO had passed once CMS received the money from the bank it then took action to pass the money on to Ms A. This is in line with the CMS guidance on Receiving child maintenance. This guidance says that once CMS have collected a child maintenance payment from the paying parent, it will pass it on to the receiving payment. The guidance sets out that CMS aim to do this within one week of receiving payment from the paying parent.

53. CMS followed the relevant guidance when it passed on the money taken from Mr L’s bank to Ms A. As this is the case we will take no further action.

CMS did not deal with Mr L’s complaints promptly

54. Mr L told us that when CMS looked at his complaint it did not follow its procedures correctly as it intentionally failed to respond to his letters at the relevant time.

55. Mr L first contacted CMS to raise his concerns in November 2020. He asked CMS to respond to the information he provided asking for the LSDO to be disapplied.

56. CMS responded to this letter and told Mr L he missed the deadline to make representations, but he could still appeal against the final LSDO.

57. As Mr L was not satisfied with how CMS had dealt with the issues raised, he contacted his MP. His MP then contacted CMS on Mr L’s behalf.

58. Mr L’s MP first contacted CMS on 24 February 2021. He then sent a further five emails between March and July asking CMS for a response. CMS eventually responded to the MP in September 2021. This was a seven-month delay in responding.

59. CMS follow the Department for Work and Pensions (DWP) complaints procedure. The DWP complaints procedure does not set out a timescale to deal with complaints. It does say it will deal with complaints in line with its customer charter.

60. It took CMS seven months to respond to Mr L’s complaint, this is not in line with the DWP customer charter which says when you raise a complaint CMS will deal with your request the first time you contact it, or as soon as it can.

61. When ICE investigated Mr L’s complaint it found that CMS failed to respond to his MP and made a recommendation for CMS to make a consolatory payment to Mr L of £250. This was in recognition of CMS’s failure to reply to his complaint.

62. As CMS failed to deal with Mr L’s complaint in line with the DWP customer charter we have considered the impact on Mr L and what CMS have already done to address this.

63. Following the ICE investigation CMS wrote to Mr L. It apologised that he had not received the level of service he should have. It agreed to pay him £250 as recommended by ICE. This payment was in line with the DWP Financial redress for maladministration staff guide. This guide sets out that consolatory payments usually range from £50 to £500 in recognition of injustice or hardship arising from maladministration.

64. Mr L has told us that due to CMS actions it left him in financial hardship. He also said it affected his mental health. The financial hardship he told us about was in relation to CMS taking £3899.26 from his bank account. It appears CMS did not cause financial difficulty by how it dealt with his complaint as by this point it had already deducted the money from his account, which is a separate matter that we have dealt with above.

65. We have considered any other impact on Mr L that delays in CMS responding to his complaint caused. We understand this has been a difficult time for Mr L and we can see the issues he is complaining about have caused him avoidable frustration and anxiety that affected his mental health. We are sorry to hear the negative impact this has had on him.

66. Our principles for remedy set out different levels of injustice and different scales of financial remedy. There are six levels and from the evidence of the impact the mistakes had, we can see Mr L’s injustice sits at level two.

67. A level two injustice will typically arise when what has gone wrong has had a relatively low impact on the person affected. This will often result in a degree of distress and inconvenience. The financial remedy we usually consider to be appropriate to put right an injustice described at a level two is between £100.00 and £450.00.

68. As the £250 financial redress CMS offered Mr L following the recommendations contained in the ICE report is in line with our scale, we can see that the amount offered by CMS is appropriate and in line with our guidance.

69. When CMS decided on the level of financial redress to offer Mr L, it did so in line with our Principles for Remedy. Our Principles for Remedy say: ‘Where maladministration or poor service has led to injustice or hardship, public bodies should try to offer a remedy that returns the complainant to the position they would have been in otherwise. If that is not possible, the remedy should compensate them appropriately’.

70. As CMS have already taken appropriate action to compensate Mr L for its poor service we will take no further action.

The ICE investigation of Mr L’s complaint failed to address the failings of CMS

71. Mr L told us that ICE missed some of the concerns he raised, and he does not believe its investigation addressed the serious failings of CMS. Mr L told us CMS did not consider the link between CMS failings and false information provided to it by HMRC.

72. When Mr L complained to ICE about these issues it told him that it is not within the remit of ICE to determine maintenance liabilities. It also told him it is not within the scope of ICE to investigate complaints about HMRC.

73. The role of ICE is to review complaints about certain government organisations that deal with benefits, work and financial support. This includes both DWP and CMS. However, it does not include HMRC who have a different complaints process. As this is the case ICE have no legal power to investigate complaints about HMRC.

74. Mr L wanted ICE to consider if date provided by HMRC may have been inaccurate which may have affected how much child maintenance he should pay. Mr L believes this was the case as he was a full-time student with no income, but HMRC told CMS he did have an income when it calculated his initial liability in 2017.

75. ICE did not investigate this issue as it directly related to Mr L’s child maintenance liability. To see if it should have addressed this issue, we have considered ICE guidance ‘How to bring a complaint to the Independent Case Examiner’.

76. This guidance explains which cases ICE cannot deal with. It says ICE cannot deal with complaints or disputes about matters of law. The guidance specifically gives an example of this as any decisions in relation to benefit entitlement decisions. A decision that CMS had not calculated Mr L’s maintenance liability correctly would be a matter of law and an issue he could appeal if he believed it was incorrect.

77. As Mr L did not follow the statutory appeals process at the time this is a decision that ICE cannot change and have no power to investigate. As this is the case there are no indications of maladministration in how ICE considered Mr L’s complaint about CMS.

78. As this is the case we will take no further action in relation to Mr L’s complaint. We know this will be disappointing for Mr L, so we hope our clear explanations are helpful for him to understand the reasons for our decision.

1. We have carefully considered Mr L’s complaint about the Child Maintenance Service (CMS) and Independent Case Examiner (ICE). Mr L brought his complaint to us as he remains dissatisfied with how CMS and ICE dealt with his case. We understand Mr L feels strongly about this and are sorry to hear these issues caused him added stress and worry at a difficult time for him.

2. We have seen no indications of failings in how CMS or ICE dealt with the issues Mr L brought to us. This is because we found both CMS and ICE followed the relevant legislation, policy and guidance when they dealt with the issues complained about.

3. We did see that there was a delay in CMS dealing with Mr L’s complaint. CMS have already apologised for this delay and offered to make a consolatory payment of £250. As this is the case, we can see it has already done enough to put right the impact on Mr L. As such we will take no further action. We explain our decision in detail below.