The Government has extended the consultation on the Child Maintenance Service (CMS) to ensure there is suitable time for feedback from external organisations.
The consultation, launched 8th May 2024, is a chance to discuss ways the CMS can help to increase the number of children being kept out of poverty.
DWP Lords Minister, Baroness Maeve Sherlock:
This government is committed to tackling child poverty and ensuring children get the support they need to have the best start in life. Child maintenance is important to this goal.
The extension of the consultation into the Child Maintenance Service that we’ve announced today will ensure that we provide the best possible opportunity to hear the concerns and thoughts of expert groups and individuals.
DWP’s proposals, launched under the previous government, include:
- Stopping the Direct Pay service and deal with all cases via Collect and Pay with CMS collecting and transferring all payments. This would allow the CMS to tackle non-compliance faster and, when necessary, take enforcement action more quickly.
- Exploring the best way to support family-based arrangements with an enhanced calculation tool, along with signposting to conflict resolution support.
- Asking how the CMS can better support victims of domestic or economic abuse, building on recommendations from Dr Samantha Callan’s 2023 Independent Review of the Child Maintenance Service.
The extension will now close on 30th September 2024.
It comes as the government launch the Child Poverty Taskforce, chaired by the Work and Pensions and Education Secretaries, part of the ambitious strategy to reduce child poverty and give children the best start in life.
Want to know more about CMS?
- In the 12 months to March 2024, the CMS arranged over £1.4 billion in child maintenance payments and was managing 722,000 arrangements for 658,000 paying parents and 986,000 children.
- Child maintenance payments from both CMS and family-based arrangements help to keep 160,000 children out of poverty each year.
- 100,000 through non-statutory arrangements and 60,000 through the Child Maintenance Service.
How to make a maintenance arrangement
More information for parents on how to make arrangements for maintenance payments can be found on the Get Help Arranging Child Maintenance tool: https://child-maintenance.service.gov.uk/get-help-arranging-child-maintenance
The maintenance options
Where family-based arrangements are not appropriate, the CMS provides parents with two options for organising payments:
- Direct Pay: Once the CMS has calculated maintenance payments, both parents agree how the money will be paid and when.
- Collect and Pay: CMS collects the money from the paying parent and sends it directly to the receiving parent.
Employer obligations, Payroll and deduction from earnings order (DEO) payments
DEOs are a way of collecting child maintenance directly from a paying parent’s earnings or pension.
By law, an employer must:
- give information to the Child Maintenance Service if you’re asked to
- send payments as soon as possible, to arrive no later than the 19th day of the month after the month the employer made the deduction under a DEO
- tell the Child Maintenance Service immediately if there are any problems with taking payments from a paying parent’s earnings
- make regular deductions
An employer can be fined £500 for each missed payment and up to £1,000 for not providing information they have been asked for.
An employer must tell their employee in writing (this can be electronic) about each deduction when you give them their payslip. Include whether they have taken £1 administrative costs.
If the administration charge is taken, it does also reduce pay considered for National Minimum Wage purposes, so where pay is close to minimum wage rates, the employer needs to be careful of not creating a NMW breach.
Most good payroll software has capability to automatically handle the calculation of a DEO by simply entering the amount due each pay period. Other aspects of the calculation should be automatic such as the calculation of protected earnings.
For more information on how DEOs are applied within payroll see:
PAYadvice.UK 1/8/2024