Government proposes abolishing Direct Pay and reducing Collect and Pay fees

The government has announced proposals to reform the Child Maintenance Service (CMS), including abolishing Direct Pay and reducing the fees charged for Collect and Pay¹. The announcement was made on 8 May 2024, when a consultation opened¹.

Under the proposals, Direct Pay would be abolished and the fees for Collect and Pay reduced¹. The government is also looking at what can be done to help parents set up their own private maintenance arrangements, and has said it wants to look at how survivors of domestic abuse can be better supported¹. The consultation will be open for 12 weeks¹.

Gingerbread, which campaigns on single parent issues, said it "cautiously welcomes the proposals" at first glance¹. Its head of policy and campaigns, Sarah Lambert, said:

The charity said it has concerns that if the new system is not implemented properly it could lead to an increase in single parent families who do not have a child maintenance arrangement, and that it is considering its position on the reduction rather than abolition of Collect and Pay fees¹. It also said it welcomes the proposals to reduce the fees for using the CMS, an issue it has long campaigned on, and that the government has listened to its concerns on Collect and Pay charges¹.

The consultation document is titled "Child maintenance: improving the collection and transfer of payments"¹. The sources do not set out the current fee levels, the proposed new fee levels, or the date any change would take effect; these have not been reported¹.

Why it matters for households

Parents who use the CMS to arrange and enforce child maintenance are affected by the proposals. Direct Pay is the route where parents pay each other directly, with the CMS calculating the amount but not collecting it; Collect and Pay is the route where the CMS collects from the paying parent and passes it on, and charges fees for doing so¹. Abolishing Direct Pay and reducing Collect and Pay fees would change how payments are made and what they cost, but the sources do not give the amounts involved or the date of any change¹.

Gingerbread's stated concern is that the reforms risk more families ending up with no arrangement at all¹. It also points to enforcement: it says over half a billion pounds is owed to children because of a lack of enforcement¹. The government has said it wants to look at better support for survivors of domestic abuse, a group Gingerbread says makes up a high percentage of parents who use the CMS¹.

What happens next

The consultation is open for 12 weeks from 8 May 2024¹. Gingerbread has published a guide to responding to the consultation and is asking single parents to take part¹. No date has been reported for a government response or for any change to come into force¹.

For background on how the service works, see Child Maintenance: Arrangements and the Child Maintenance Service.