10 February 2006
Sir David Henshaw, the chief executive behind Liverpool City Council's renaissance as a high-performing local authority, has been recruited by Work and Pensions Secretary John Hutton to lead a review of the troubled Child Support Agency.
As Public Finance went to press, senior officials were putting last-minute touches to a statement to Parliament by Hutton, to be delivered on February 9.
This was outlining the government's plan to improve the CSA, as well as the wider child maintenance services undertaken by the government.
It follows an internal review of the CSA's current functions by its chief executive, Stephen Geraghty, who has reported back to ministers on the challenges facing the organisation, which collects and pays out child maintenance payments from absent parents. Geraghty's findings were expected to be published this week.
PF was told that Henshaw, who announced last week that he was taking early retirement from Liverpool, has been asked to lead a wider review. He will head a unit based in London and is currently recruiting his review team with a view to starting work this spring.
A senior source said Henshaw, who has been chief executive at Liverpool for over six years, could be asked to 'redesign the whole policy and administrative architecture relating to child maintenance'.
Hutton's statement was also expected to detail plans to place some of the CSA's functions, possibly including debt collection, in the hands of private sector.
The agency collects and pays out payments totalling £600m annually, ensuring that over 500,000 children receive support from absent parents. However, the CSA has been dogged by a massive backlog of payments – currently estimated at 330,000 - with total arrears estimated at £3.1bn.
Problems have escalated because of a flawed £465m computer system, which has been unable to deal effectively with payments made under a new maintenance formula since 2003. Consequently, thousands of payments have not yet been transferred to the new formula and are inaccurate.
Stephen Holt, the Department for Work & Pensions' chief operating officer, recently told PF that the CSA computer system was likely to be the last example of a 'big bang' approach to IT across government, because it was taking so long to correct the programme.
However, the agency has also experienced problems with non-payments by thousands of absent fathers who simply fail to declare their incomes. A DWP spokesman confirmed that up to £1.8bn of the £3bn payment arrears was now probably 'uncollectable', because parents or incomes could not be traced.
Plans to scrutinise parents' tax records and credit card bills have been considered by the DWP, but it was not clear if Hutton would announce such initiatives this week.
Some politicians have called for the CSA's collection functions to be transferred directly to the Revenue & Customs department.
PFfeb2006
