Parents who have split up will have to pay the Government "4p in the pound" if they need to use the new Child Maintenance Service (CMS) because they cannot be civil enough to come to informal arrangement themselves, the minister for pensions said.
Steve Webb assured Good Morning Britain the new system was "much more effective" than the previous Child Support Agency.
"If the Dad for example, gets a pay rise, we automatically go to tax records, update the figures so maintenance will go up every year there is a pay rise. That will help parents with children."
The new Child Maintenance Service (CMS) will start charging a "£50-£300 finding fee" to locate an ex-partner who has fallen behind on child support payments, it has emerged.
The Department for Work and Pensions is introducing sweeping reforms to the previously free CSA, including turning it into the CMS.
Other charges include:
- A £50 charge if the CMS has to arrange a deduction from an employer.
- A further £50 if they have to take a late child support payment out of a bank account.
- Taking a former partner to court will now cost £300.
The Government is writing to 52,000 parents to begin closing their Child Support Agency (CSA) arrangements and inform them of potential charges if they cannot come to an informal compromise.
A new agency called Child Maintenance Service will replace the CSA and will collect money on behalf of parents who fail to come to an informal agreement.
However, the Government will now start charging families for this service.
Parents have the option of a family based arrangement - which will cost nothing - or face a £20 charge if they use direct pay.
However, if one parent refuses to pay and the Child Maintenance Service intervenes then both adults will be charged.
An influential group of MPs said giving the taxman the power to recover money directly from personal bank accounts without some form of prior independent oversight would be "wholly unacceptable".
The Commons Treasury Committee also dismissed George Osborne's argument that the Department for Work and Pensions (DWP) already had similar powers to collect child maintenance.
The parallel is not exact: in those cases, DWP is acting as an intermediary between two individuals.
HMRC [HM Revenue and Customs] would be acting not as an intermediary between two individuals but rather in pursuit of its own objective of bringing in revenue for the Exchequer.
Our reforms are necessary to restore fairness to the system and make a better use of social housing. Unreformed, the Housing Benefit bill would have grown to £26 billion in 2013/14.We have given councils £345 million since reforms came in last year to support vulnerable groups, especially disabled people.
The removal of the spare room subsidy means we still pay the majority of most claimants' rent. But we are saving the taxpayer £1 million a day which was being paid for extra bedrooms and are freeing up bigger homes for people forced to live in cramped, overcrowded accommodation.
A Department for Work and Pensions minister has said he is 'pleased' that Atos will receive no compensation after it ended its contract with the Government over controversial assessments of whether benefits claimants are fit to work.
Minister "pleased that Atos will not receive a single penny of compensation from the taxpayer for early termination" #esa
Today we are announcing we are seeking a new provider to replace Atos for the Work Capability Assessment
In response to Cabinet Office minister Francis Maude's admission that the implementation of the Universal Credit system has been "pretty lamentable", the Department for Work and Pensions has told ITV News Iain Duncan Smith has "not shied away from any tough decisions" over the policy:
DWP spox says Iain Duncan Smith has not shied away from any tough decisions in terms of Universal Credit development and implementation.
Responding to the Government’s admission that Universal Credit behind schedule, Shadow Work and Pensions Secretary Rachel Reeves MP labelled the Coalition as "out-of-touch".
Iain Duncan Smith has today admitted what everyone has known for months – that Universal Credit is massively behind schedule. But just a couple of weeks ago he was telling Parliament the Government would 'roll out Universal Credit on the plan and programme already set out'.
It’s clear that David Cameron and Iain Duncan Smith have completely failed to get to grips with their flagship welfare reform and millions of pounds of taxpayers’ money have been written off as a result. Families facing a cost-of-living crisis deserve better than this.
Universal Credit, the new single payment for people who are looking for work or on a low income, will be rolled out throughout 2013 and will replace benefits such as:
Income-based Jobseeker’s Allowance, the unemployment benefit paid by the government to people who are unemployed and seeking work.
Income-related Employment and Support Allowance (ESA) - for the ill or disabled, ESA offers financial support if you’re unable to work or personalised help so that you can work if you’re able to.
Income Support - for people with no income or a low income who are working less than 16 hours a week and haven’t signed on as unemployed.
Child Tax Credit - can be claimed for each child you’re responsible for if they’re under 16 or under 20 and in approved education or training.
Working Tax Credits - you could qualify if you’re aged 16 or over, work a certain number of hours a week, you get paid for the work you do (or expect to) but your income is below a certain level.
Housing Benefit - to help you pay your rent if you’re on a low income.