Failing Child Support Agency axed

The failing Child Support Agency (CSA) is to be scrapped and replaced by a new system that will see absent parents who fail to pay maintenance having their passports suspended and being hit with curfews.

Under the current CSA system there is around £3.5bn of outstanding maintenance to be collected with only one in three parents receiving any payment - at a net cost to the taxpayer of £200m each year.

IT problems have been at the heart of the CSA's troubles, with the CS2 system developed by EDS costing £539m to roll out to date and expected to rise to a total of £1.1bn by 2010 when that contract ends.

The CSA was branded one of the "worst public administration scandals in modern times" by MPs last month and the government will now axe the agency following a review of the CSA by Sir David Henshaw.

Henshaw's report said a new organisation should be established to start from scratch and not be contaminated with system difficulties from the past. This will mean parents will be invited to reapply to the new body if they wish to continue their child support claim so there would be no need for conversion of cases between the two existing child support schemes.

The report said: "The legacy of past failure is significant and cannot be allowed to put new arrangements at risk. Responsibility for failings has often been unfairly placed upon staff who have done their best to deliver for children and parents while coping with, among other things, poor systems architecture and significant IT problems. The CSA brand is severely damaged and its credibility among clients is very low."

A separate dedicated body will also be set up to chase down old debts and close cases.

The Henshaw Report said any new IT requirements will be considered in the run-up to the end of the existing IT contract with EDS in 2010.

Work and Pensions secretary John Hutton said in a statement: "I want to thank staff at the CSA, who continue to do their best in very difficult circumstances. There will be big changes ahead but, in the meantime, if any parent thinks they can avoid paying maintenance they are very wrong. We will not relax our efforts as we move to the new system, in fact we will be getting tougher and have already started contracting out debt to debt collection agencies."