Child Support, Pensions and Social Security Act 2000

Child Support, Pensions and Social Security Act 2000

2000 CHAPTER 19

Part 1: Child Support.

Commentary on Sections

Maintenance calculations and interim and default maintenance decisions

Section 1: Maintenance calculations and terminology

13. A central part of the Government’s reform of the child support system is a new way of working out child support liability. In place of the existing formula, which includes a wide range of income and expenses in the assessment, will be a simpler system of rates, based solely on:

• the non-resident parent’s* net income (taking into account a restricted range of potential income sources); and

• the number of children for whom the non-resident parent is responsible.

14. It is intended that the maintenance calculation should be based on one of three rates: a basic rate, a reduced rate or a flat rate.

• The general rule is that there should be a basic rate of liability based on a percentage of the non-resident parent's net weekly income. The percentages applied will depend on whether the non-resident parent is liable to pay maintenance for one, two or three or more children. Where the non-resident parent is also responsible for children living in his household (referred to as “relevant other children”), the basic rate is calculated by applying the percentages to the non-resident parent's net weekly income after this has been reduced to take account of the number of relevant other children.

• A reduced rate, which will be payable where the non-resident parent's net weekly income is more than £100 but less than £200.

• A flat rate, which will be payable if the non-resident parent’s net weekly income is £100 or less or he receives a prescribed benefit, pension or allowance, or he or his partner receive any prescribed benefit. It is also intended that certain categories of non-resident parent (including those with a net weekly income below £5) will have a nil rate of liability.

15. The new calculation rules allow for apportionment of the liability where there is more than one person with care*. The provisions for apportionment of liability are in Schedule 1, paragraph 6. The rates can be modified in shared care cases, that is, if the non-resident parent has any child for whom he is liable to pay child support living with him for at least one night a week. Provision for shared care is set out in Schedule 1, paragraphs 7 to 9. Maintenance liability can also be varied in exceptional cases – the provisions for varying the liability are in sections 5 to 7 of this Act.

16. Sections 4 and 7 of the 1991 Act provide that persons with care, non-resident parents and, in Scotland, qualifying children, can apply for a maintenance calculation. Section 6 of that Act (substituted by section 3) provides that parents with care who claim Income Support or income-based Jobseeker’s Allowance can be treated as having applied for a maintenance calculation. It is the duty of the Secretary of State to reach a decision on any application for which he has jurisdiction.

17. Sections 4(10) and 44 of the 1991 Act provide circumstances in which there is no jurisdiction. These provisions are amended by sections 2 and 22 of this Act.

18. Section 1 provides the basis for the maintenance calculation and the rates that will be used to determine maintenance liability.

19. Subsection (1) substitutes a new section 11 (dealing with the rules for maintenance calculations) in the 1991 Act.

New section 11: Maintenance calculations

20. This section places a duty on the Secretary of State to make a maintenance calculation. It provides, for the purposes of revision, supersession and appeal, that the outcome of the calculation is a decision about whether child support maintenance is payable.

21. New section 11(1) and (2) provide that the Secretary of State shall deal with an application for a maintenance calculation in accordance with the Act and make a decision about whether, and how much, child maintenance is payable, or decide not to make a calculation, or make a decision under section 12.

22. New section 11(3) to (5) allow the Secretary of State to stop acting on an application treated as made under section 6(3) if the parent with care ceases to fall within section 6(1). (Section 6(3) of the 1991 Act is substituted by section 3 of this Act. It provides that a parent with care who claims or receives Income Support or income-based Jobseeker’s Allowance can be treated as having applied for a maintenance calculation). However, if the parent with care still wants to apply for a maintenance calculation (in other words she wants it treated as though she has applied under section 4 of the 1991 Act) and there is no court order or pre-1993 written maintenance agreement* in place preventing this, then she has one month to respond to the letter telling her that the Secretary of State intends to stop acting. Where the parent with care is content for the Secretary of State to stop acting on her application, but the non-resident parent has already been contacted, then the non-resident parent must be notified. If the parent with care is herself prevented from applying under section 4 then she must be notified of this. These provisions mirror subsections (1A), (1B) and (1C) of the existing section 11.

23. New section 11(6) provides that the amount of a maintenance calculation shall be fixed by the rates set out in Part I of Schedule 1.

24. New section 11(7) provides for maintenance where a variation has been agreed to. New section 11(8) refers to Part II of Schedule 1.

25. Subsection (2) of section 1 amends the 1991 Act to replace existing child support terminology, where it appears in the 1991 Act, with the new terminology to be used in the reformed child support scheme.

• Maintenance calculation will replace maintenance assessment.

• Calculation will replace assessment wherever it occurs in connection with an assessment of maintenance.

26. Subsection (3) introduces a new Part I of Schedule 1 to the 1991 Act.