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In January 2011, the Department for Work and Pensions published a Green Paper entitled Strengthening families, promoting parental responsibility: the future of child maintenance. The LITRG response to that consultation reiterated a number of concerns the organisation had raised back in 2008 when the changes to the system were first being proposed.

 

Unfortunately, the detailed regulations published on 1 December 2011 do not allay LITRG’s fears in the slightest, and the group’s calls for discussions on the proposals have not been heeded.  

 

The LITRG response therefore recommends that a working group is urgently established to discuss the issues that remain around the use of HMRC data before the draft regulations are finalised. 

 

HMRC are in the midst of a major change to the PAYE system with the introduction of Real Time Information (RTI) with effect from April 2013. The 2008 legislative changes to child maintenance, moving to “gross” instead of “net” income, have arguably been overtaken in 2012 by the development of RTI which collects both “gross” and “net” sums. Also, this now appears to be out of step with the “net” income basis envisaged for Universal Credit.  

 

LITRG believes that a detailed examination of the interfaces between the proposed child maintenance regime and RTI is essential. LITRG also does not believe that sufficient attention has been paid to how the PAYE system currently works, with the consequence that income sources may be omitted or even double-counted.

 

If the group’s calls for a detailed review are ignored now, LITRG envisages significant problems down the line, one of which will be that the parents who are looking after the children (and ultimately the children for whom they are responsible) will not get the support they need. 

 

The LITRG’s recent submission is available here.