Negative credit ratings and child support


 

Last month the Government issued a press release which indicated that new regulations can be expected, subject to parliamentary approval, in 2015 which will enable the Child Support Agency to share information concerning non resident parents with credit rating agencies.

 

The effect of this is that non payment of child support may result in a negative credit rating for the paying parent. This in turn may adversely affect that parent being able to obtain a mortgage, credit card, mobile phone and other forms of financial credit.

 

Whilst the exact circumstances in which this may take place are not currently clear, it appears that the Agency will take this step when they have obtained an order from the court, known as a liability order, which confirms the funds are outstanding and paves the way for other enforcement action, in addition to the above.

 

This seems to indicate that the Government does intend to get tough on parents who do not pay child support. However, the proof is in the pudding and the underlying question is whether the Agency will use this process. What has to be remembered is that the Agency has had, for many years, fairly extensive powers to enforce but has chosen not to use them.

 

The other point is, of course, that the sharing of information in this way does not actually enforce payment. Its main function may, therefore, be the deterred effect, alongside the threat to confiscate passports and ultimately send to prison.

 

Whilst improvements have been made in recent years, the tendency of the Agency has previously been to use its resources to collect child support from those parents who are “easy” to collect from in order to boost revenue and, in doing so, placed less emphasis on chasing after those parents, who do not willingly pay, and who will be difficult to enforce against.

 

The new measure may just be another headline grabbing technique that will, in practice, be little used and/or ineffective. What the Agency really needs to focus on is those enforcement methods that actually result in payment. It is this that matters to the child, and receiving parent, not whether the “ex” will now find it difficult to obtain a mobile phone.

 

benjamin.carter@cripps.co.uk