System failure

Thousands of parents are losing out because of problems with the Child Support Agency, including many on income support who are losing £10 a week.

The House of Commons select committee on work and pensions has been told by Department for Work and Pensions officials that the major constraint on the CSA’s ability to improve its performance is that EDS, the CSA’s IT supplier, has failed to get the vital computer system working effectively. As a result the select committee was told that the DWP was “withholding funds on account of under-performance” while trying to get EDS to rectify the problems.

Although the DWP is contracted to pay out £5,000 an hour to EDS for the next 10 years, and current expenditure on the new system stands at £456m against original estimates of £427m, the new system is still not yet operating properly. EDS has already replaced the senior management responsible for the project.

However, with staff morale clearly already low, the DWP has also announced plans to reduce the current staff complement at CSA from 12,000 to 8,000 within the next three years.

Child support was reformed in March 2003 for all new applicants, making the calculation of child support much simpler. In addition, parents on income support getting child support under the new rules now have a £10 “disregard” applied to their income (referred to as a child maintenance premium).

Ministers have repeatedly said that the new CSA system would not be applied to old cases until they are confident that the IT to support it is running smoothly. This now looks like it could take another year at least. The select committee was informed that “the software that we needed to do bulk conversions of existing assessments into the new-style calculations was intended to be available to us around the autumn of this year. It is now clear that that will not be available to us until the spring of next year.”

This is mainly because EDS is concentrating on fixing problems with the new cases. But this is creating a dangerous backlog. Under the old complicated system there was a caseload intake of approximately 30,000 new cases every month, but in the past month the agency took in 6,349 cases and made just 1,200 maintenance calculations.

Another casualty of the current difficulties is the new child maintenance premium. It is currently being applied to fewer than 100 cases. Yet, if “old” cases had been upgraded to the “new” assessment on schedule, many thousands of parents on income support would now be £10 a week better off.

The DWP has nevertheless ruled out compensation for those in the old system who continue to miss out on the premium because their claims haven’t been reassessed under the new rules. Apparently, the situation doesn’t meet the test of maladministration that triggers payment. This is a bit surprising given the penalty clauses being levied on EDS.

The new system also allows for the possibility of non-resident parents who refuse to co-operate with the CSA having their driving licences withdrawn. It appears, however, that this sanction has been used just twice – despite the fact that non-compliance rates are running at 24 per cent.

Gary Vaux is head of money advice, Hertfordshire Council. He is unable to answer queries by post or telephone. If you have a question to be answered please write to him c/o Community Care.