Changes to Child Maintenance System

Article date: 03.11.08

* From November 1st 2008, the Child Maintenance and Enforcement Commission (CMEC) replaced the running of the Child Support Agency. It is anticipated that it will not be until around 2011 that the existing cases will be transferred to the new scheme. The main changes to the scheme therefore are as follows:

  • Noone will be required to use CMEC services, but those who do will be advised on setting up voluntary arrangements. The idea is to encourage as many people as possible to reach an effective maintenance arrangement with their former partner.
  • CMEC is obliged to provide information and guidance to parents to assist them in making and managing their own voluntary arrangement. CMEC’s website (www.cmoptions.org) provides guidance as to how a voluntary arrangement can be put into effect.
  • If voluntary arrangements do not work, cases will be referred to CMEC which now has tough enforcement powers. The formula under the new scheme is based on gross income as opposed to net income, the details of which will be provided direct to CMEC by HM Revenue & Customs.
  • New benefit claimants will not now be required, regardless of their wishes, to involve CMEC and can keep the first £20 a week of maintenance.
  • The new formula will provide two different sets of percentages to be applied where the non-resident parent’s (NRP) gross weekly income exceeds £800. For income below this threshold, the percentage to be applied is as follows
  • 12%   one child
  • 16%   two children
  • 19%   three or more children

For any weekly income above £800 the following set of percentages apply

  • 12%   one child
  • 16%   two children
  • 19%   three or more children

If the gross weekly income exceeds the threshold, two calculations have to be made and then added to arrive at the basic rate liability. There is a different formula where the NRP’s gross weekly income is less than £200.

  • The current upper limit of the formula, which is currently £2,000 net per week has been increased to £3,000 gross per week. Any income over and above this limit will be ignored.
  • Deductions can be made in respect of relevant other children living with the NRP as such, gross weekly income is reduced by 12% for one child, 16% for two children and 19% for three or more children.

If you need any further advice or guidance in relation to child maintenance or the financial implications of divorce or separation, please contact us.

* This is not legal advice; it is intended to provide information of general interest about current legal issues.