Child Support Agency is still in chaos, says NAO

29 Jun 06
The Child Support Agency is still blighted by poor performance despite a £1bn package designed to stabilise it while its future is decided, auditors have reported.

30 June 2006

The Child Support Agency is still blighted by poor performance despite a £1bn package designed to stabilise it while its future is decided, auditors have reported.

A damning study of two main improvement plans introduced in 2003 shows that the agency reduced a huge backlog of child maintenance claims between January 2005 and March 2006.

But its recent performance has again dipped and a 'backlog of cases… increased during February and March 2006'.

The study, published by the National Audit Office on June 30, also reveals that the cost of operating the CSA has reached 70p for every pound in maintenance that the agency pays out and the estimated cost of reform since 2000 will have reached £1.1bn by 2010, compared to an initial estimate of £606m.

Other problems identified include a rise in the average time taken to process a maintenance claim to 34 weeks (38 during March 2006), against a target of six weeks; staff routinely ignoring correct procedures when processing claims; and payment enforcement teams set up to improve performances costing more (£12m) than they retrieved in overdue payments (£8m) during 2004/05.

An NAO spokesman told Public Finance that 'these problems had either developed, or had worsened, since the improvement plans were introduced', and 'were in addition to many of the long-term problems that the agency has experienced'.

The CSA's historical difficulties include a massive backlog of claims (333,000 by March 2006) caused by the problematic IT system operated by supplier EDS.

This includes 36,000 new claims for child maintenance that have become 'stuck in the system' and cannot be processed without 'manual intervention', the NAO reports. Around 19,000 must be processed outside of the CS2 computer system set up to manage all claims.

The CSA's failures have resulted in £3.5bn in uncollected maintenance – 60% of which must be written off. 'We're saying that the improvement plan has been over-ambitious. It has not been a value-for-money process and neither, in some instances, has it worked effectively,' the NAO spokesman told PF.

Problems in clearing cases have continued despite a £320m operational improvement plan (OIP) implemented following an internal review of the CSA's performance by chief executive Stephen Geraghty last year.

Edward Leigh, chair of the Commons Public Accounts Committee, said that the auditors' study confirmed that the 2003 changes were 'a complete failure' that 'ranks among the worst public administration scandals in modern times'.

But NAO auditor general Sir John Bourn warned that there 'will be no quick fix'.

Bourn's study calls for Geraghty's OIP to be subject to the Office of Government Commerce's Gateway Review process 'to provide a series of assessments and advice to help safeguard the further substantial sums being committed to improving the agency's performance'.

The UK's entire system of child support is currently subject to a review by former Liverpool City Council chief executive Sir David Henshaw.

However, the NAO report highlights some improvements since 2003. The agency has collected more than £5bn in maintenance since 1993 and serves 1.5 million parents. Accurate payments have also risen – from 75% in 2004/05 to 81% in 2005/06.

PFjun2006

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