Major CMS Reform Planned: What It Means for Parents
On 23rd June, the Government published its response to feedback on how to improve the collection and transfer of child support payments. A significant shift is on the horizon: the consolidation of the Child Maintenance Service (CMS) into a single unified system. This change will impact hundreds of thousands of families. James Pirrie breaks down what’s changing, what’s promised and what concerns remain.
Unified Child Maintenance Service
In its response to improving the collection and transfer of child support payments it was recorded that:
- 65% of receiving parents wanted to consolidate the CMS into a single service. This would mean a service that would terminate “direct pay” – the arrangement where parents are told the sums that will be paid and received, and then manage the day-to-day flow of money directly.
- Only 18% of paying parents wanted this. They stated that they did not like the increased control and do not have great confidence in the CMS.
Transition to a Single CMS Model
The unified service is expected in 2027 or 2028. From that “all change” date the CMS will be collecting and transferring all payments.
The Government promises that this will get money flowing faster and protect against abuse.
It will also mean that parents who are in the direct pay scheme and are worried about non-payment will not face delays before they can move into the collect and pay scheme.
New Fee Structure
From the go-live date there will be:
- 2% fees for recipients (2% of the payments received is taken in admin); and
- 2% fees for payers (a sum charged on top of the obligation), assuming they are compliant. Non-compliance will see the fees rise to 20%, in line with the current collect and pay scheme.
We are promised that genuine reasons for missed or incomplete payments will be taken into consideration and it will be easier to get back onto the 2% fee regime*; worries remain that non-compliance is often about affordability rather than evasion and such high penalties will not solve the problem.
.. (*Having said this, it still looks as if there would need to be meticulous compliance for six months before moving off the 20% fee regime.)
Concerns Around Domestic Abuse Support
There has been pressure for a single named caseworker to help survivors of domestic abuse – but all the reform promises is:
- an operational team targeted on the issue
- encouragement to caseworkers to refer cases to the team
- the possibility of a named caseworker.
There are no published plans to improve domestic abuse and trauma informed training. Also, no plans to remove the fees for victims of domestic abuse.
Risks of Voluntary Arrangements
As the only way to avoid fees will be by setting up arrangements between parents directly. One has to worry whether the fees-for-all plan will mean greater pressure to make voluntary arrangements, with the risk that payments are made at reduced levels and there is greater encouragement for coercive behaviours.
Implementation and Resourcing Challenges
Whilst we are promised:
- quicker identification of non-compliance
- quicker re-establishing of compliance
- faster more responsive case handling
- improved fewer and clearer customer communications
the realities remain that the CMS currently manages on collect and pay 314,000 cases but the direct pay cohort is closer to 440,000. This looks like it would be a 140% increase in its current caseloads when (we assume, because we are sure we would have be told otherwise) there will be no vast increase in staff to manage the additional work.
What next?
The proposed CMS reforms are significant and, if done well, could improve the reliability and speed of child maintenance payments. However, concerns remain around enforcement fairness, support for abuse survivors and the capacity the CMS has to handle a dramatically increased workload. With years to go before rollout, there’s still time for improvements — but clear planning and accountability will be essential to deliver the service families need.
If you have any questions or would like to speak to an expert, please contact James Pirrie who has been noted as “undoubtedly this country’s expert on child support“. Contact details for James are below.