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Head of the National Audit Office Sir John Bourn has qualified his opinion on the Child Support Agency’s account for the tenth year running because of high levels of error in the amounts considered as recoverable from non-resident parents.

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At the 31 March 2004, £976 million was due to be collected by the Agency from non-resident parents for payment mainly to parents with care. Reporting to Parliament today, Sir John said that he had qualified the Agency’s 2003-2004 account because, as a result of his audit, he estimated that a significant proportion of the individual debt balances that make up the £976 million were incorrect. This was mainly because of historic errors in the underlying maintenance assessments.

For the same reason he also estimated that 28 per cent of the payments received by the Agency in 2003-2004 from non-resident parents for onward transmission mainly to parents with care were incorrect. The total received by the Agency from non-resident parents during the year amounted to £601 million.

Sir John estimated that:

  • of the £601 million received by the Agency from non-resident parents, there were overpayments of £10.7 million and underpayments of £15.3 million; and
  • of the £976 million due from non-resident parents, the amount of £720 million considered as recoverable for full maintenance assessments contained overstatement errors of £161.2 million and understatement errors of £99.6 million; and the £256 million considered as recoverable for interim maintenance assessments included overstatement errors of £8.6 million and understatement errors of £5 million.

The Child Support Reforms, introduced in March 2003, were aimed at simplifying and modernising the system for making maintenance assessments. These reforms were based on a simplified set of new rules for maintenance assessments to reduce errors; stronger powers for the Agency to improve the flow of maintenance; and revised administrative arrangements to secure better engagement with parents and a faster turnaround of cases. These changes were underpinned by a new computer and telephony system designed and developed by Electronic Data Systems (EDS) under a private finance initiative.

Today’s report points out that performance targets for cases processed under the new rules are not being met in terms of case compliance; and the accuracy of maintenance assessments under the new rules are not yet matching performance under the old rules.

"Once again I have had to qualify this account because of the high levels of historic error in maintenance assessments that completion of the Child Support Agency’s reforms are intended to remove. The operation of the new arrangements with their simplified methodology for calculating maintenance assessments has so far been disappointing. In 2003-2004, the first year of operation of the reform programme, the accuracy of maintenance assessments has not matched performance levels under the old scheme.

"I intend to report later on what the Agency is doing to achieve its agreed targets and to provide a faster and improved service to all parties and to complete the Reform programme."

Sir John


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