To ask the Secretary of State for Work and Pensions, what the reasons are for the difference in charges incurred by a resident parent and a non-resident parent for using the Child Maintenance Service's collect and pay scheme.
Answered on
5 December 2016
The ongoing charges ensure that both parents make a financial contribution towards the cost of using the Collect and Pay service, which remains heavily subsidized by the taxpayer. More importantly the four percent charge for the paying parent and the twenty percent charge for the non-resident parent provides an incentive to encourage them to pause and consider their options for a maintenance arrangement. For example, whether they need to use the Collect and Pay service or whether they could use Direct Pay, which has no ongoing charges.
Paying Parents can avoid charges if they pay their maintenance liability on time and in full on Direct Pay. If they are compliant they cannot be forced to use the Collect and Pay service and be liable to charges.