Political & Treasury involvement
When should it be Treasury support, not child support?
There are two very different types of fiddles that many non-resident parents aspire to:
It is in the interests of government to blur the difference between these. So they condemn the second type and give the impression that they are the same as the first type. That way they can gain moral approval for actions which taxpayers may actually not approve of if they understood the difference. Government also talks about "children should share in the wealth of their parents", when for about 40% of the children being administered by the CSA it really means "the Treasury should share in the wealth of the parents" - and it will continue to mean this with the reformed scheme.
There are various ways of protecting taxpayers' interests:
The child support system started off focused on the first of these. With so many lone parents on Income Support, a way was desired of reducing the social security bill. Then along came Working Families Tax Credit (WFTC) - "outside" the child support system - and changed the rules. WFTC costs a lot of taxpayers' money in the short term. It disregards child support, so ignores those tax-saving opportunities. But if it gets people back to work, into the habit of working, makes far more people economically active and increases the velocity of money in the UK, it will be in the taxpayers' interests longer term.
This suggests that the primary focus of child support should be to cause people to behave "better" rather than to save taxpayers' money - in other words social engineering. The idea of social engineering is often scorned or even condemned. But not doing something is still a form of social engineering! What does "better" mean? For a taxpayer, it means "become economically active and a net contributor to the Treasury"!
Parts of government, even parts of the Treasury, are ahead of me here. WFTC with its total disregard for child support is a key example, and a knee-jerk reaction was that this threw away a lot of saving of taxpayers' money. But the greater the analysis of the interaction between child support and means-tested benefits & tax credits, the more incentives become apparent for people to behave badly. The articles showing the interactions between an NRP's WFTC and child support are examples.
Government can force compliance with ever harsher punishments, and where people do harm to others, this may be necessary. But where punishment is to protect the Treasury against lots of people who appear to want to behave in a particular way - perhaps society is trying to tell the government something! Clients of the CSA are voter-taxpayers too - or ought to be!
So how can the social security payments to lone parents be controlled?
Reduce their eligibility to Income Support once the children get to school!
The article that shows how much wealthy parents are likely to have to share their wealth with the Treasury discusses why there is only a limited child support disregard proposed for Income Support even in the reformed scheme. It suggests that the disregard should be shaped according to the age of the youngest child to offer a much higher incentive to get into work and onto WFTC once the youngest is at school. And this would release money to provide a bigger disregard before that point when there are significant problems with childcare and possibly developmental problems too.
This incentive could be beefed up by progressively withdrawing the right to Income Support and perhaps changing other disregards as the youngest got to junior school then secondary school. Income Support is for people working less than 16 hours per week, not just for people out of work. It only disregards a small amount of earnings. Income Support, JSA(income based), and WFTC could all be shaped to phase in extra hours of work at each type of school, until at some age Income Support simply wouldn't be available to lone parents. It means strengthening the requirements for New Deal for Lone Parents, not cancelling it.
Both main political parties at one time or another have mentioned withdrawal of benefits from lone parents as their child get to school. Time to act.
What has this got to do with child support, which is the topic of this web site?
Another article here said:
The interference between Income Support and child support in the current scheme undoubtedly caused many parents to disrespect the law and also caused many children to be worse off. The ongoing interference between an NRP's WFTC and child support appears to be a potential cock-up. Avoiding interference between a PWC's WFTC and child support will probably prove to be a major improvement all round.
The thesis here is - avoid as much such interference as possible, and get the money back in other ways, if necessary. If society doesn't want to pay to keep lone parents on Income Support - change the eligibility rules, don't subvert child support!
|Page last updated: 17 December, 2003||© Copyright Barry Pearson 2003|