LEGAL
(Updated 10 March 2007)
ARTICLES ILLUSTRATING LEGAL CIRCUMSTANCES RE: CSA
Result of Helen Smith Case
Self-employed fathers face higher child support payments
Clare Dyer, legal editor
Thursday July 13, 2006
The Guardian
Thousands of self-employed fathers will have to pay more in child support after a divorced mother won a House of Lords ruling yesterday.
The victory is the culmination of a five-year battle by Helen Smith, 42, to force her ex-husband Robert, a car dealer, to pay more for the support of their three children, Harry, 18, Edwina, 16, and Miles, 15.The Child Support Agency, which dealt with 280,000 cases last year, was set up to assess fathers' support obligations through a formula and make it simpler to collect payments, rather than leaving it to mothers to enforce orders through the courts. But the family law solicitors' group Resolution said the Smiths' case highlighted the "nightmare" the system has proved to be where the paying parent is self-employed. Mrs Smith, from Oldham, Greater Manchester, who split from her husband in 1997, had 33 different assessments from the CSA over the years. In 1999 the child support regulations were changed to make it simpler to work out how much fathers should pay by allowing them to use the figure of "total taxable profits" from their tax return. But it was left uncertain whether capital allowances for assets bought for the business could be deducted, as they can be for tax purposes, in working out the final figure.
The difference was dramatic in the case of the Smiths. Without the deduction, the payment would be £361 a week; if deductions were allowed, only £87.50 a week.
Yesterday the law lords decided by 3-2 that the allowances cannot be deducted, overturning a court of appeal ruling allowing them to be taken into account. Mrs Smith's and possibly thousands of other cases will have to be reassessed, and she stands to win tens of thousands of pounds in backdated child support.Lady Hale, one of the three judges who ruled in Mrs Smith's favour, said that if Mr Smith was allowed the deduction, the assessment would be based on earnings of just £20,892: "This bore no relationship to his actual earnings that year."
Mr Smith has been paying £750 a month voluntarily in recent months, pending another assessment. Mrs Smith, now studying for a law degree, said she felt "vindicated" by the judgment.
from The Scotsman 30 June 2006
£539m 'wasted' on shoring up the CSA
JAMES KIRKUP
POLITICAL EDITOR
MINISTERS spent more than £500 million trying to reform the beleaguered Child Support Agency, but failed to improve its performance at all, a damning official audit has found.The National Audit Office (NAO) investigation concluded that the government's attempts to improve the agency, starting in 2003, were ill thought-out, badly managed and, most of all, wasteful.
The government spent £539 million on trying to restructure the agency and improve its computer systems, but all it achieved was "a scheme that has performed no better than its predecessor".
Partly as a result of the failed reforms, every pound the CSA recovers in maintenance payments costs the taxpayer 70p in administration. Despite that record of failure, the Department of Work and Pensions has begun another programme of reforms, at a cost of £120 million.
The independent NAO said its report was intended to offer "constructive" analysis, but Sir John Bourn, the auditor- general, said criticism could not be avoided. "From design to delivery and operation, the programme to reform the agency has been beset with problems," he said, adding that the reforms "have not achieved value for money and have not achieved what they were designed to do".
And as well as wasting considerable sums of taxpayers' money, the auditor pointed out that the failures at the CSA "will have caused genuine hardship and distress to many parents and their children".
The 2003 reforms introduced rules meant to make the system for calculating maintenance payments to single parents simpler and fairer.
But three years after their introduction, 61 per cent of the agency's caseload is still dealt with under its old rules and there is currently no date for the conversion of the 923,000 "old rules" cases, the audit found.
As a result, the NAO said some of the poorest parents were being denied as much as £520 a year in payments.
The NAO also found evidence of huge backlogs in dealing with old cases, and serious delays in dealing with new ones.
In March this year, one in four applications the CSA had received since March 2003 were still waiting to be cleared and there is a backlog of about 267,000 "new rules cases" and a further 66,000 "old rules cases". On average "new rules" cases take 34 weeks to clear.
Opposition parties seized on the NAO's damning criticism. Philip Hammond, the Conservative work and pensions spokesman, said the NAO had provided "yet more evidence of Labour's appalling mismanagement of the CSA".
He continued: "The government has failed to demonstrate the political leadership needed to drive the improvements which are desperately needed by so many single-parent families."
David Laws, a Liberal Democrat spokesman, said the NAO report was "devastating" and made the case for scrapping the CSA and administering maintenance payments via HM Customs and Revenue.
Earlier this year, John Hutton, the Work and Pensions Secretary, said the government was aware the CSA was "not fit for purpose". Yet, despite that comment and all the criticism contained in the audit, ministers insist they were pleased with the report. A government review of the CSA is expected to report later in the summer and ministers are likely to present the changes it recommends as effectively bringing about the abolition of the agency in its current form.
Lord Hunt, a Department of Work and Pensions minister, insisted that the NAO's report had actually vindicated the government's treatment of the CSA.
"It has confirmed the views of ministers that we were right to take a fundamental look at both the policy and delivery of child support to ensure the money we spend delivers for children and their parents," the minister said.
This article: http://news.scotsman.com/politics.cfm?id=953242006
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Birgit Cunningham is a dedicated campaigner, experienced in Political PR, ILEX III qualified and a Paralegal.
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