Politics: Field hints at tax plan to replace Child Support Agency

The Child Support Agency could be scrapped and replaced with a tax levied on errant fathers, MPs were told last night by Frank Field, minister for welfare reform. The Liberal Democrats said taxing absent fathers would be more unfair, Colin Brown and Fran Abrams report .

A "simple" tax on errant fathers could be introduced to replace the cumbersome and heavily criticised Child Support Agency, Mr Field said last night. The idea floated by Mr Field was immediately criticised for threatening to make an "unfair system even less fair" by David Rendel, the Liberal Democrat spokesman on welfare.

Refusing to rule out the possibility of abolishing the CSA, Mr Field told MPs there was a "crunch question" to be faced in the coming months over the CSA.

"We will have to choose at some stage whether we are going to have a complicated formula or move to something much simpler - a possible simple tax rate."

His remarks suggested ministers are close to scrapping the formula which has been at the root of criticism of the CSA, with some saying it is too rigid and fails to take account of people's circumstances, while others say it has become too complicated in a bid to meet those variations.

Mr Field's comments indicated one possible solution might be to relate payments directly to the earnings of the absent parent. He gave no details but by using the tax system, ministers could argue that it would be a fairer system, by taxing the rich more than the poor. It would also be simpler, with employers deducting money from earnings.

Liberal Democrats, who forced the debate on the Government, said the Government's own motion was so critical of the CSA that it increased the likelihood it would be scrapped rather than reformed.

Labour ministers previously supported reform rather than abolition of the CSA. But abolition was not ruled out last night in the government motion, which attacked the Tories for introducing the CSA "in a hasty and ill-thought-out manner" and criticised the child-support formula as "complex, difficult for parents to understand, and slow, inaccurate and expensive to deliver".

Calls for a government-backed voluntary system under which parents would agree arrangements for the support of their children when they divorced were rejected by Mr Field.

The minister said it would be unfair to blame CSA staff, as the formula they had to use was so complex that 90 per cent of their time was spent grappling with it.

The Government's reform would aim to support children, get payments to families in need, to give parents more choice, protect taxpayers, move the issue of access up the political agenda and establish a system staff could understand.

Opening the debate for the Liberal Democrats, Mr Rendel said the CSA had failed and should be abolished. He called for a system of mediation to arrive at voluntary agreements, backed by a family court or tribunal. "The Child Support Act has failed to meet the needs of absent parents, it has failed to meet the needs of parents with care and, above all, it has failed to meet the needs of children. The Child Support Act is beyond repair and it is now as friendless as it is unfriendly".