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Entries in CSA charges (1)

Monday
Jun302014

The charges are coming

Although child maintenance applications have been made under the new child support scheme (CS3) since last year, a major change to the system has been waiting in the wings for some time.

Charges for the child maintenance service carried out by the government have been threatened ever since the CSA was launched in 1993, but the continuing problems with the CSA meant that charging could never be justified.

Two major child support reforms later, one of the main features of the CS3 scheme is the introduction of disincentive measures intended to reduce the amount of Government intervention and persuade more people to sort out child support for themselves.

The Government will finally introduce a £20 charge for applications for maintenance assessment from this week, with "collection" fees starting from 11th August and further charges made if "enforcement action" has to be taken to collect money. 

These collection fees comprise a 20% surcharge for the parent paying maintenance on top of the assessed amount and a further 4% taken from the maintenance assessment before it is paid over to the parent receiving maintenance. The fees will only apply if the Collect and Pay Service is being used.

his means that for every £100 assessed, the non-resident paying parent will actually have to hand over £120. From this sum, the Government takes an administration fee of £24, leaving only £96 for the receiving parent.

The new charges won't be applied to people on the older child support systems, but over the next couple of years all existing CSA cases will be closed and the parents will have to re-apply under the CS3 system for maintenance assessments, collection and enforcement.

A parent paying maintenance who has a good payment record and doesn't have arrears cannot be forced to use the Collect and Pay Service.  Charges can be avoided on the new scheme by making direct payments or by making a family-based arrangement with your ex-partner. 

The main problem comes if you are in dispute about an assessment, or cannot afford to make the payments at the assessed level.  Adding a 20% charge on top of current payments, plus hefty enforcement charges, will inevitably cause major problems to some people, and the disparity between the 20% rate for parents who pay maintenance and 4% for those who receive it was strongly opposed by FNF as inequitable. 

Please let us know if you face problems with the new system.