2003 articles

2003-01-27
BBC

Delayed CSA system to go online

The CSA has long been dogged by controversy

A long-delayed Child Support Agency system designed to simplify maintenance assessments is to be introduced in March, the government has announced. Work and Pensions Secretary Andrew Smith said he was now satisfied the new system, which was originally due to come into effect in April 2002, would "deliver a level of service our customers have the right to expect".

The new IT system is key to bringing in the much needed child support scheme with its better, fairer, simpler system of calculating maintenance. The new formula, designed to be an improvement on its much criticised predecessor, uses a simple percentage rate of maintenance payment - based on 15% of the absent parent's net income for one child and 20% for two children.

Mr Smith told MPs in a statement: "Implementation of the new IT system is key to bringing in the much needed child support scheme with its better, fairer, simpler system of calculating maintenance. "It will help us target resources to make sure that more maintenance is actually paid, getting more money to children more quickly."

The agency was now "more customer focused" and was collecting £200m more each year in child maintenance than it was five years ago.

"Both my senior officials and I are now satisfied, on the basis of the careful and comprehensive testing, that the system will deliver the level of service our customers have the right to expect," said Mr Smith. Mr Smith told MPs the government's share of the bill had gone up by about 7% over the term of the contract.

"While any extra costs are unwelcome, an increase on this scale is not at all unusual for a complex project of this kind and is justified to deliver this important reform," he said. Mr Smith said his predecessor Alistair Darling had taken "the right decision" in announcing last March that the new scheme would be delayed until the government was confident the new IT was "working effectively".

David Willetts, the shadow work and pensions secretary, welcomed the announcement "with some relief after years of delay". But he said EDS, which built the new Child Support Agency computer system, had blamed interference by ministers for the delay. "We know the government is going to pay more as a result of this delay - that implies the government accepts some responsibility for what has happened," he said.

Liberal Democrat spokesman Paul Holmes predicted the announcement marked only the start of the "next shambles". Mr Holmes said the new computer system was postponed in 2001 because it could not cope with working out simple sums about people's income. He asked: "How will it cope with a sudden flood of information when the one million existing cases are transferred to it?"

From 3 March new CSA cases will be calculated using the new rules and will come onto the system at a rate of 30,000 a month. The existing 1.1 million cases will be moved on to the new system when it is clear the arrangements are working.

Under the new rules, absent parents with net incomes of £200 to £2,000 a week will be expected to pay about 15% for one child, 20% for two and 25% for three or more. For those parents with incomes of less than £100 a week, maintenance will be set at £5 a week. For those earning between £100 and £200 a week there will be a sliding scale.

2003-01-28
Independent

Long-delayed CSA computer system to go live in March

Nigel Morris, Political Correspondent

The long-delayed overhaul of the Child Support Agency will finally begin, 17 months late and having gone £29m over-budget, Andrew Smith, the Work and Pensions Secretary, announced yesterday. A new system of payments will come into force in March after a catalogue of problems developing the computer technology that will administer it.

The CSA is switching over to a new, streamlined system of payments, arguing it will make them simpler and fairer. But the original start date of October 2001 was delayed to last April and then postponed again.

In a Commons statement, Mr Smith said that after further tests on the system, developed by the American company EDS, the Government had concluded it would "deliver a level of service that is acceptable". But he added: 'With any system of this size, even after exhaustive testing, there will be some bugs to be sorted out." Mr Smith told MPs that because of the delay the bill for setting up and running the system had risen by 7 per cent, from £427m to £456m. "The system has proved to be more complex than had been originally thought and we have reached a negotiated agreement with EDS to share these costs, with them meeting their share under the contract," he said. "While any extra costs are unwelcome, an increase on this scale is not at all unusual for a complex project, whether in the private or public sector, and is justified to deliver this important reform."

Initially the system will handle about 30,000 new CSA claims a month. The 1.1 million existing cases will be gradually transferred.

Under the reforms, absent parents with net incomes between £200 and £2,000 per week will pay 15 per cent of their income for one child, 20 per cent for two children and 25 per cent for three or more children. For those on less than £100 a week, maintenance will be set at £5 a week, and there will be a sliding scale for those on between £100 and £200 a week. Mr Smith said: "The new scheme will be more transparent, easier for parents to understand, easier for the agency to calculate maintenance and enforce payment, so children get the support they need." Rounding on Tory criticism of the hold-up, he said: "It was right to delay rather than rush in with an incomplete system. Let us remember why we are having to modernise the system. It was the Tories who rushed this in 10 years ago. They had goodwill on all sides of the House. It collapsed under its own weight because it was overly complex."

David Willetts, the shadow Work and Pensions Secretary, called for more details of reasons for the over-run. He said EDS had blamed it on ministerial interference, adding: "The announcement only affects new cases, so over a million families on the existing system are still in the dark. When will they start to be moved on to the new formula?"

2003-01-28
The Times

Streamlined child support payments ready to go ahead

By Greg Hurst, Parliamentary Correspondent

REFORM of the Child Support Agency is finally to go ahead after the Government announced yesterday that it was confident that problems with a new computer system had been overcome. From early March all new cases for child maintenance will be based on a standard formula using a proportion of the absent parent’s net income, rather than calculated case by case as before.

The 1.1 million child support cases whose payments were worked out under current arrangements will transfer to the new formula later when ministers are satisfied that the computer system can cope. The streamlined formula, under which most absent parents will pay 15 per cent of net income for their first child, 20 per cent for their second and 25 per cent for three or more children, was announced in 1999. Problems with the computer system meant that its introduction was delayed twice, most recently in March last year.

Andrew Smith, the Work and Pensions Secretary, told the Commons yesterday that his department had negotiated a settlement with EDS, the information technology company, to share the higher costs arising from the delays. The Government’s share would rise by £29 million to £456 million over the lifetime of the contract, Mr Smith said.

David Willetts, the Shadow Work and Pensions Secretary, welcomed the announcement but blamed the delays and higher costs on interference by ministers.

Kate Green, Director of the National Council for One Parent Families, said: “Thousands of lone parents who for years have scraped by without child maintenance will be very relieved to learn that the long period of waiting for reforms is over.” It has been criticised, however, by pressure groups, such as Families Need Fathers, who argue that it penalises fathers who share the care of their children and no longer takes account of housing costs or the mother’s income.

The first to pay under the new system will be parents whose liability for maintenance begins on or after March 3. Ministers expect 30,000 cases a month to be calculated using the formula thereafter. Some absent fathers may be required to pay more but the change is designed to make their liabilities easier to calculate in advance.

2003-02-02
The Independent

EDS bust-up exposes its dirty linen

By Jason Nissé

EDS, the Texan technology firm that runs the Inland Revenue and Child Support Agency computers, has been accused by a former senior director of manipulating its figures, putting pressure on executives to resign and spending millions on lavish entertainment for clients and staff.

Fred Steingraber, the former chief executive of EDS's consulting arm, AT Kearney, details the accusations in a damaging legal document, lodged in a US court last year. The deposition says that EDS chairman Dick Brown and finance director James Daley inflated the group's profits by early recording of income from contracts, failing to record the risk factors on contracts and hiding problems with deals.

The row has blown up at a tricky time for EDS. Last week Andrew Smith, the Secretary of State for Work and Pensions, said he had negotiated a settlement with EDS in the long-running dispute about the Child Support Agency computer system. EDS will have to pay the DWP up to £30m for delays to the system.

EDS is also close to making a joint bid, with Accenture, for the £7bn Aspire contract to run and modernise the Inland Revenue computer system.