The Judgment in the above case has recently been released and serves as a reminder of how child maintenance is dealt with differently through the Child Maintenance Service compared to when it was dealt with by the Child Support Agency.
By way of background, the Court hearing in this matter took place on 25 to 28 April 2017 and concerned a financial claim by a mother, against the father, for financial provision for their son who was 16 at the time of the hearing. I will not go into the full background here save to say that this was a highly litigated matter, with Court cases concerning the parties frequently taking place in various Courts, including hearings at the County Court, the Family Court and the High Court. There had also been appeals through the tribunal in relation to the level of child maintenance that the father was paying.
The Judge in the most recent Judgment referred to above, explained that part of the mother’s claim was for lump sums on behalf of the child (including a lump sum to replace her car, amongst others). Part of the hearing also mentioned the appeals from both parties against the assessment for liability of child maintenance that had been made by the Child Support Agency (as was the body dealing with the child maintenance at that time). It is that latter aspect that I deal with below.
It had been agreed by both the mother and the father in this case that the hearing (which in the end took place on 25 to 28 April 2017, as referred to above) would not take place until the outcome in relation to the Child Support Agency appeals was known, with the decision in that latter respect being given on 19 April 2017.
During the course of the most recent hearing, it was explained that the appeals to the Child Support Agency were heard in November 2016. This was following an application by the mother for a variation to the assessment of child maintenance liability (of the father).
The ground upon which the mother was seeking to rely was “assets”. This is where the Child Support Agency could look beyond the income of the paying parent (here, the father) and look at assets which that parent owned with the relevant assets being taken into account and a figure attributed to those assets as producing an income (they could do this even if those assets in fact did not produce any such income).
In this case, it had previously been determined that £830,000 of the father’s assets could be taken into account for the purposes of the regulation and deemed income at a rate of 8% was applied to those assets which was said to contribute and give rise to a liability for child maintenance during the relevant periods at £44,140.
It is important to note that it was during the relevant periods that some of the father’s assets were taken into account for the purposes of calculating his liability for child maintenance (as well as any income that he had during that time), namely in this case, periods commencing on 29 April 2009, 16 November 2011 and 5 July 2013 respectively.
The case in question however was then transferred over to the newer statutory child maintenance pursuant to the Child Maintenance and Other Payments Act 2008.
Under that scheme, the ground of “assets” for the purposes of a variation for a calculation of child maintenance liability does not apply. Therefore the Child Maintenance Service (which replaces the Child Support Agency) cannot take into account “assets” as a ground for a variation to the level of liability for child maintenance.
Prior to the above Judgment being given, the Child Maintenance Service had recently assessed the father’s liability for child maintenance at a rate of £7 per week. This is despite the fact that, in the Judge’s words in this case, the father “has millions which may properly be regarded as his resources”.
The fact however now is that the Child Maintenance Service cannot take into account his assets in the way that the Child Support Agency were able to do so.
The Court in this case could not order periodical payments (maintenance) for the benefit of the child either as the father’s gross annual income is not in excess of £156,000 per annum and therefore the Court dismissed the mother’s claim in this respect – it simply did not have jurisdiction (power) to make the Order sought.
This led to the Judge in this case mentioning what he termed “an extraordinary state of affairs from recent amendments to child support legislation”. He explained that “assets”, as I have explained above, used to be a potential ground for a variation and he went onto say that “for reasons which I cannot fathom the “assets” ground of variation has been removed from this latest regime… In my opinion the government needs to urgently consider the reinstatement of the “assets” ground of variation”.
This is certainly an interesting point. Should it be the case, as used to be the position, that some assets could be taken into account and deemed as generating an income (even if they did not) and taken into account for the purposes of assessing someone’s liability for child maintenance?
Alternatively, is the most recent regime fairer – taking into account income and excluding assets (apart from where they produce a relevant income) for the purposes of a child maintenance assessment?