Child agency a 'total failure'

NEW figures revealing the dramatic scale of the failure of the Child Support Agency have thrown its future under a Labour government into doubt.

As the agency marks its third anniversary, Frank Field, Labour chairman of the Commons social security select committee, released figures which show a fewer than one-in-four success rate. About 300,000 people who have failed to reply to letters are not being followed up; they are being granted what amounts to an "amnesty", Mr Field said.

The number of single mothers and children who receive money from fathers, he argues, is no greater than it was before the agency was created; its only effect has been to cut social security fraud.

Mr Field yesterday called for a completely new system, with errant fathers being pursued by the Inland Revenue. Labour's front-bench spokesman on the CSA, Malcolm Wicks, said the party's social security review is examining greater use of the tax system.

Labour's hardening of attitude is a big blow to the agency which has cost half a billion pounds in its three years. Under its highly rated new chief executive, Ann Chant, it had been thought to be improving its performance.

But Mr Field's figures, culled from the House of Commons library, show that, up to this February, 896,000 cases had been "cleared" by the CSA, but in well over half - 500,000 - the agency had made no assessment. That means it assumed the person was dead, abroad, in prison or otherwise unable to respond.

In the 368,000 successful assessments, records do not reveal how many people are actually paying money. With 1.25 million single mothers on income support or family credit, the success rate is fewer than one in four.

In addition there are more than 400,000 cases outstanding. A further 300,000 are not being actively pursued because those involved have refused to respond to letters.

As a by-product of its activities, the agency has cut fraud. Since it began work, pounds 360m of social security books have been returned by people who are not entitled to claim benefit and feared further investigation.

Mr Field, whose committee will take evidence on the issue after Easter, said: "By sheer accident we have created a most efficient anti-fraud unit. We should extend that and learn the lessons of the CSA by introducing a new agency to run in tandem."

He favours a simple formula, levying a higher rate of tax on errant fathers depending on number of children. Under this system, modelled on experience in Australia, money would be collected by the Inland Revenue. The CSA would be phased out.

Labour's front-bench team, which is reviewing the future of the CSA, has not yet embraced this approach. At one stage Labour policy-makers, including Chris Smith, shadow Social Security secretary, and Mr Wicks canvassed the possibility of scrapping the agency and returning to a court-based system. That has now been ruled out.

But Labour is still contemplating reform which is likely to include at least some of Mr Field's thinking. Mr Wicks said yesterday: "I do not see why there should not be far clearer collaboration between the Inland Revenue and the Child Support Agency. The CSA has gone for those people it sees as soft touches. But there are a group of fathers who are effectively laughing at the CSA, and at other parents, including many on low income, who pay maintenance. For them there should be no hiding place."

A spokeswoman for the agency said yesterday: "The CSA is proving to be a very cost-effective operation. If it achieves this year's targets, the agency will have collected or arranged over half a billion pounds of maintenance." It would also, she added, save pounds 1.4bn in social security spending.