A major charity has called on the Government to scrap “unfair child maintenance fees” following research suggesting that hundreds of millions of pounds are owed to children across the UK.
Gingerbread, the charity for single parent families, said the Child Maintenance Service (CMS) is “not only failing” children, but charging them too.
Launched in 2012, the CMS, amongst other things, is responsible for collecting money on behalf of children for families who have not been able to make a private arrangement for paying their child’s living costs – known as “Collect and Pay”.
Child maintenance can be paid between payments, directly from the paying parent’s earnings, by direct debit, or by reducing the paying parent’s benefits.
To pay for this “Collect and Pay” service, however, fees are taken by the CMS from money owed to children by non-resident parents. Parents whose children receive child maintenance are charged a £20 application fee as well as a four per cent fee levied on any maintenance payments received.
In total, £6.77 million in fees were collected from maintenance payments owed to children in 2019/20.
But with the latest figures suggesting that some £408 million is now owed to children across the UK from parents refusing to pay living costs, Gingerbread has called for 100 per cent of maintenance payments to be handed to resident parents.
The figures, published by the Department for Work and Pensions (DWP), reveal that 100,900 children are not receiving the child maintenance owed to them through ‘Collect and Pay’, 28 per cent of parents are not paying any of the child maintenance they owe under ‘Collect and Pay’, and, since December 2020, overall arrears owed to children have increased by £12.5 million.
Commenting on the report, Victoria Benson, Chief Executive of Gingerbread, said: “It is a child’s legal right to be supported by both parents, and the Child Maintenance Service was established to help to enforce this right. Yet the very service designed to protect this right is not only failing them but charging them, too.
“While it’s right that the government should collect maintenance on behalf of children where it is not willingly paid, it is incredibly unfair that fees are deducted from this money before it is passed on.
“Children are going without as a result of these fees being deducted and it simply cannot be right that a government service is responsible for this.”