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Selected Cases and Summaries of Completed Investigations - October 2000 to March 2001
Volume 4 - 2nd REPORT - SESSION 2001-2002
Chapter 1
12. Case No. C.1685/00
Child Support Agency: unreasonable demand to pay arrears and failure to reply to correspondence
Summary
Following receipt of a maintenance enquiry form in January 1994 Mr Y wrote two letters to the Child Support Agency (CSA) querying their jurisdiction. They did not reply. Instead, in April, they made an interim maintenance assessment of £95.40 a week, without telling the court that had ordered Mr Y in December 1988 to pay child maintenance of £25 a week. Mr Y subsequently wrote again asking for a response to his original query; but CSA did not reply. Indeed CSA did not get in touch with Mr Y at all until January 2000, when they told him that he owed £29,683.09. That figure ignored the payments Mr Y had made regularly under the court order. The Ombudsman was highly critical of CSA’s inertia over nearly six years and of their subsequent actions. After his intervention CSA made a consolatory award of £900 to Mr Y, to include stress caused to him and his wife. CSA also decided to defer arrears of £17,219.20, provided that Mr Y paid arrears of £1,935.69 under proposed arrangements.
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Full text
12.1 Mr Y complained that the Child Support Agency (CSA), an executive agency of the Department of Social Security, failed to reply to letters he sent to them in 1994 asking why they had asked him to complete a maintenance enquiry form when he was making regular maintenance payments under the terms of a court order. He also complained that, while he had provided CSA with the information they needed to make a full maintenance assessment, they did not contact him again until 13 January 2000, when they told him he owed £29,683.09 to be paid within a week.
12.2 My investigation began in May once the Ombudsman had obtained comments from the then Chief Executive of CSA. I have not put into this report every detail investigated by the Ombudsman’s staff; but I am satisfied that no matter of significance has been overlooked.
Background
12.3 CSA were set up under the Child Support Act 1991 to administer the assessment, collection and enforcement of child support maintenance. A parent with care of a qualifying child or children in receipt of a prescribed benefit, including family credit, is normally required to seek maintenance from the non-resident parent through CSA. The parent with care completes a maintenance application form which provides information about the non-resident parent, to whom CSA send a maintenance enquiry form to obtain a financial statement so that a maintenance assessment can be made under a standard formula. Maintenance assessments were made and reviewed by child support officers based in regional CSA centres. The date from which a non-resident parent’s liability to pay maintenance starts is known as the effective date. If there is an existing court order for maintenance (as in Mr Y’s case), the non-resident parent’s liability to pay child support maintenance starts two days after the maintenance assessment has been made. That has the effect of cancelling the court order, and CSA notify the court accordingly.
12.4 Shared care is defined as where more than one person has day-to-day care of a child and they do not live in the same household. The legislation does not provide a definition of day-to-day care. A person is treated by CSA as having day-to-day care if he has care of the child for at least 104 nights in a 12-month period. If the care is for less than 104 nights he remains liable for the full child maintenance and his contribution to the care of the child is not taken into account in calculating the amount of child maintenance.
12.5 Where there has been a property or capital settlement between the non-resident parent and the parent with care before April 1993 (as in this case), CSA may make an allowance for that in a maintenance assessment provided that qualifying conditions are met. A specialist section within CSA deals with such matters.
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12.6 Where a non-resident parent fails to supply the information required to allow a maintenance assessment to be made, CSA can make an interim maintenance assessment which will usually be at a higher rate and thus provides a stimulus for the non-resident parent to provide the necessary information. Only after new regulations were made with effect from 16 February 1995 could CSA amend an interim maintenance order which had an incorrect date or was for an incorrect amount. The regulations were not retrospective.
12.7 Where other methods of collection have failed or seem likely to fail, CSA may seek to enforce payment of child support maintenance. CSA first contact the non-resident parent to ask him to arrange full payment of the arrears, or where that is not possible, to negotiate an agreement to pay in instalments. Where a voluntary arrangement is broken or not reached, and the non-resident parent is in paid employment, CSA may impose a deduction from earnings order on the employer to secure payments of regular maintenance and arrears. Such a decision is a discretionary one.
12.8 Since November 1998 CSA have operated a policy under which they have been able to agree to a request made by a non-resident parent to defer all but the last six months’ worth of any arrears which have built up as a result of delays by CSA in carrying out a periodic or change of circumstances review. For a non-resident parent to qualify under the scheme, CSA must have been responsible for at least three out of a minimum of six months of delay and he must agree to pay the most recent six months’ worth of arrears and make regular payments under his ongoing maintenance assessment for a period of 52 weeks.
12.9 Under the terms of the non-statutory departmental compensation scheme, the scope of which the Ombudsman and his predecessors have accepted, CSA may consider paying compensation where official error or unreasonable delay has led to actual financial loss. CSA may also make consolatory payments, in exceptional circumstances, where, as a result of official error, a person has suffered gross inconvenience or severe distress. Severe distress is defined as the physical effect experienced directly as a result of an error and it may express itself as a serious deterioration in either physical or mental health.
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Jurisdiction
12.10 It is not for the Ombudsman to determine a person’s liability for, or entitlement to, child support maintenance. Nor, in the absence of maladministration, may the Ombudsman criticise discretionary decisions taken by officers acting on behalf of the Secretary of State. The Ombudsman is generally debarred from investigating any action in respect of which a person has, or had, a right of appeal and where that right has been exercised, the bar on the Ombudsman’s intervention is absolute. I refer to such matters in this report only to set in context the administrative actions of CSA in dealing with Mr Y’s case.
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Investigation
12.11. 1993 On 17 September the local CSA centre received a completed maintenance application form from the parent with care of Mr Y’s son, who was receiving family credit. I refer to her as Ms B. She said that she was receiving £25 a week in child maintenance from Mr Y under a court order which had been in force since December 1988.
12.12. 1994 On 14 January the centre sent Mr Y a maintenance enquiry form to complete and on the same day Ms B gave them further information about her circumstances which they required.
12.13. On 26 January Mr Y wrote to the centre (received there on 31 January) asking why he had been sent an enquiry form when he was already paying maintenance under an order made by a county court. The centre did not reply to that letter, but meanwhile sent a reminder to Mr Y on 29 January to return the form to them by 12 February, failing which a child support officer would make an interim maintenance assessment (paragraph 12.6). Mr Y wrote again on 23 February to ask why he had not had a reply to his letter of 26 January. He said the matter was causing tremendous stress and asked that his letter be forwarded to the Director of CSA. CSA did not reply to that letter.
12.14.On 29 April a child support officer made an interim maintenance assessment of £95.40 a week with effect from 4 February 1994 (the wrong effective date). The centre informed Mr Y (and Ms B) about that the next day and said that their action had stemmed from a refusal to supply information needed to calculate a full maintenance assessment. They said that they would contact Mr Y shortly about payment arrangements. (Note: The centre did not set up an account for the collection of child support maintenance from Mr Y. Neither did they notify the county court that the interim maintenance assessment effectively cancelled the court order.)
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12.15.Mr Y wrote to the centre by recorded delivery on 7 May acknowledging receipt of their letter of 30 April. He asked why they had not replied to his letters of 26 January and 23 February and offered to send copies if required. He also gave a telephone number at which he could be contacted and asked for a quick response. The centre did not reply to his letter.
12.16. On 11 July Ms B telephoned the centre to enquire about possible enforcement action. There is no evidence from the papers that the centre reacted at all.
12.17. 1995 On 6 January the centre sent review forms to both Mr Y and Ms B as a periodical review was due on 3 February. On 18 January the centre received a letter returning Mr Y’s review form. The writer said that Mr Y had left the address on 13 August 1994. In response to enquiries made by the centre the Inland Revenue gave CSA details of Mr Y’s employer and last known address on 17 March. (Both were those already held on the centre’s records.) In response to enquiries made by the centre on 27 March, on 10 April the employer confirmed that Mr Y still worked for them. The employer gave a different address for Mr Y - his current address.
12.18 1998 On 28 October the centre noted that the effective date of the interim maintenance assessment should be checked before any further action was taken on the case. (There is no evidence to show what prompted that nor that any action was taken.)
12.19 1999 On 16 February the centre wrote to Ms B to ask her to confirm Mr Y’s address and to give details of any payments she had received since 17 September 1993. They also made internal enquiries on the same day about a “confident” employer for Mr Y. On 25 March the centre recorded that the employer’s details (which are no longer on file) had been updated. On 6 May Ms B told the centre that she did not want any further action taken on the case at that time, but did not want it closed.
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12.20 2000 On 12 January Ms B asked the centre for a deduction from earnings order to be served on Mr Y’s employer. On the same day the centre set up an account for Mr Y. That indicated that for the initial payment period between 4 February 1994 and 21 January 2000 he would owe child support maintenance (under the interim maintenance assessment) of £29,693.09. His first regular payment of £95.40 a week would be due on 28 January. On 13 January the centre informed both Mr Y and Ms B of that position, and suggested to Mr Y that he might clear the arrears by 20 January. Mr Y contacted the centre the next day (when they noted that he was very upset). He said that he had continued to pay child maintenance under the court order which had never been cancelled. On 17 January the centre received a letter from Ms B which gave the details they had requested in February 1999 (paragraph 12.19). She said that she had received monthly payments of £108.33, equivalent to £25 a week, under the court order and had calculated that she had received £8,124.75 from Mr Y since 17 September 1993. She also gave details of the shared care arrangements that were in place before 1996 when she moved address. On the same day CSA received authority from Mr Y for the centre to discuss details of his case with his wife, and he also sent a copy of the court order in force.
12.21 On 18 January the centre took certain actions and wrote to Mr Y. They said that the effective date of the interim maintenance assessment had been “corrected” to 16 February 1995 and that any liability for child support maintenance before that date was unenforceable (paragraph 12.6). They said that the assessment had been revised to £99.45 a week. They told him that he would need to contact the county court with a view to having the court order cancelled because CSA did not have the legislative powers to do so at the time that the order was made. (That advice was wrong.) The centre also sent review forms to Mr Y, one for 1994 and one for his current details.
12.22 Mrs Y telephoned the centre the next day. She said she would send details of the shared care arrangements and the “proof of posting slip” of the original maintenance enquiry form by Mr Y in 1994. Meanwhile the centre decided not to embark on any recovery or enforcement action. Mr Y wrote to the centre on 24 January. He said that he was most distressed by the terms of the 13 January letter. He wished to appeal against the assessment and the lump sum arrears. He said that the centre had not taken into account the payments he had made under the court order, nor the shared care of his son. He complained that despite responding swiftly to the correspondence he received from the centre in early 1994, he had heard nothing further from them until January 2000.
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12.23 On 1 February the centre wrote to Mr Y to apologise for their failure to reply to his correspondence in 1994. They said that an interim maintenance assessment had been imposed because of his failure to return the maintenance enquiry form. They said that the demand for arrears had been generated automatically from CSA’s computer and regretted if the wording was offensive. The centre said that shared care would not be included in the assessment, if in fact he qualified for it, until the forms were completed (and a full assessment calculated). They said that the interim maintenance assessment would remain in force until evidence had been received about the alleged return of the maintenance enquiry form in 1994. The centre repeated that they did not have the jurisdiction to cancel the court order in force. They said that his case had been passed to their special payments team for consideration of possible compensation.
12.24 On 7 February the Member wrote to the then Chief Executive of CSA on Mr Y’s behalf. He said that a demand for about £30,000 was having a detrimental effect on Mr Y and his family, and that Mr Y’s relationship with his son, whom he had always supported, had begun to deteriorate. The Member enclosed some copy correspondence and asked for an urgent investigation.
12.25 On 9 February Mrs Y sent to the centre a copy of a recorded delivery slip. Mr Y’s copy of his letter of 23 February 1994 (paragraph 12.13) – which CSA appear to have received with the Member’s letter – was endorsed at the top “Form sent”. The centre noted that the recorded delivery slip was dated 9 May 1994, and bore a reference number which corresponded to the reference number CSA had endorsed in manuscript on Mr Y’s letter of 7 May (paragraph 12.15). They also noted that no maintenance enquiry form had been received within CSA and that the slip in any event was dated after the interim maintenance assessment had been made. They decided that the assessment would stand.
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12.26 On 18 February the centre imposed a deduction from earnings order on Mr Y’s employer to take effect from 21 February. It required weekly payments of £99.45 a week for regular maintenance plus £19.89 towards arrears, or £517.14 each month. On the same day Mr Y’s account was adjusted to reflect the payments of £25 a week he had made between 16 February 1995 and 18 February 2000 under the court order. Following further intervention from the Member the centre asked Mr Y’s employer on 23 February to delay the implementation of the deduction from earnings order until 1 April. Meanwhile the centre sought information from both Mr Y and Ms B in order to be able to convert the interim maintenance assessment into a full maintenance assessment. The centre decided on 23 February that no “shared care” was applicable to Mr Y’s case (paragraph 12.4). Mr Y sent details of his income and housing costs for 1994 and 2000 as requested.
12.27 Before considering whether to carry out a formal investigation of a complaint referred by the Member, the Ombudsman’s staff made a number of enquiries of CSA on 1 March. On 7 March the centre asked the county court to cancel the court order for child maintenance. They notified Mr Y and Ms B on the same day. On 8 March the centre wrote apologising to Mr Y for the misinformation he had received about the cancellation of the court order and for the general standard of service he had received. They apologised for the anxiety and distress caused by the demand for payment of over £29,600 which had been calculated without taking into account his payments under the court order. They said that they were considering making a consolatory payment. On 10 March the then Chief Executive replied to the Member’s letter of 7 February, enclosing a copy of the centre’s letter of 8 March. She apologised that Mr Y’s case had not been effectively progressed between 1994 and January 2000. She said that Mr Y remained liable for payments of child support maintenance under the interim maintenance assessment and that the centre hoped to be able to calculate a full maintenance assessment once information had been received from Ms B. The matter of the arrears would be addressed fully at that time.
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CSA’s comments on the complaint
12.28 In her comments the then Chief Executive said that she accepted that the centre had failed to reply to Mr Y’s three letters written between 26 January and 7 May 1994. She could not explain that failure except by referring to CSA’s workload and associated problems at that time. The Chief Executive said that there was no evidence that Mr Y had returned the maintenance enquiry form. She also pointed out that Mr Y had made no reference in his letter of 23 February 1994 to the enclosure of the form. In her view the interim maintenance assessment would stand unless it could be established that Mr Y had returned a completed maintenance enquiry form by 29 April 1994.
12.29 The then Chief Executive accepted that little effective action had taken place on Mr Y’s case until January 2000. When he had then been advised of his arrears of child maintenance the demand had not taken into account his voluntary payments. Furthermore the centre had not given information to Mr Y concerning the new interim maintenance assessment effective from 16 February 1995 and had given wrong information about the cancellation of the court order. She apologised unreservedly for the centre’s very poor handling and said that CSA’s special payments team would urgently consider making an award to Mr Y for gross inconvenience and distress.
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Later developments
12.30 On 25 May the centre noted that the correct effective date for child support maintenance should have been 1 May 1994 – two days after the calculation of the interim maintenance assessment in a case with an existing court order (paragraph 12.3). They also noted that if a full conversion were to be undertaken, Mr Y’s arrears would be significantly higher because of his high income. After consulting Ms B, they decided not to try and implement a full maintenance assessment before 12 March 2000. On 2 June the centre notified Mr Y that a full maintenance assessment of £76.74 a week had been made effective from 12 March 2000. On 7 June the Deputy Chief Executive of CSA wrote to the Member about the revised maintenance assessment. He said that Mr Y’s arrears then stood at £20,562.59, taking into account his voluntary (i.e. court order) payments.
12.31 On 17 July the centre sent a consolatory payment of £150 to Mr Y for the gross inconvenience he had suffered. They also offered to consider making a further payment for the stress that he and his wife had suffered on production of evidence to support such a claim.
12.32 In response to further representations from the Member the then Chief Executive wrote to him on 20 July to offer apologies for further difficulties that had occurred. She explained that the centre’s decision not to implement a full maintenance assessment for the period before 12 March 2000 was beneficial to Mr Y since it would have resulted in an increase in the child maintenance arrears owed (because such an assessment would have been more than the interim assessment). She also said that a property settlement allowance could only be applied to a full maintenance assessment and that the specialist section would handle that. On or around 21 August the centre sent to Mr Y - via a wrong address - details of their decision to make an allowance of £20 a week. They offered to explain any matter concerned with the calculation of child support maintenance, by personal interview if that would help.
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12.33 Meanwhile the centre did not seek to implement the deduction from earnings order (which had remained suspended). Instead they invited Mr Y to sign a standing order to pay CSA £100 a month with effect from 4 September, which they would pass on to Ms B. Mr Y duly agreed. I understand that the centre by contrast had not altered CSA’s account from the planned recovery of arrears figure of £19.89 a week (paragraph 12.26) – another apparent error.
12.34 Mr Y’s liability to pay regular child support maintenance ceased on 11 September when his son no longer qualified. The centre notified Mr Y and Ms B of that. At the request of the Member, on 1 November the centre sent Mr Y a full breakdown of his child maintenance account for the period between 4 February 1994 and 29 September 2000, the date to which the accounts had been charged. The breakdown included adjustments for payments made by him and for the period when the interim maintenance assessment was unenforceable. The total arrears outstanding was then £21,491.37. (The effective date of 4 February 1994 was wrong, but CSA had in any event written off any arrears arising before 15 February 1995.)
12.35 Meanwhile on 23 September Mr Y returned as “insulting” CSA’s consolatory payment of £150. He said that he wished to pursue proper compensation and submitted a letter from his general practitioner about treatment for stress related illness. On 7 December the centre sent Mr Y a consolatory payment of £900, which comprised the earlier award of £150 for gross inconvenience, £500 for stress suffered by him and £250 for stress suffered by his wife.
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Findings
12.36 Before commenting on CSA’s handling of Mr Y’s case I make some general observations. Ms B was in a category of people required to apply to CSA for child support maintenance. She had no choice in the matter and was not a private client. From my examination of the case papers Ms B appears to have been somewhat uncertain about the impact of CSA’s involvement in terms of Mr Y’s willingness to co-operate and of his relationship with their son. That may explain her somewhat sporadic contacts with CSA. Mr Y no doubt believed that his divorce settlement in December 1988 was final. The county court then awarded a substantial property settlement on Ms B, together with child maintenance at £25 a week until the child’s 17th birthday (or as otherwise directed by the court).
12.37 Understandably Mr Y wanted a written answer to his question which effectively challenged CSA’s jurisdiction. The centre could easily have explained that CSA did indeed have jurisdiction (under section 6 of the Child Support Act 1991). Instead they failed to answer his three letters – a very poor performance. It must be a matter for conjecture as to whether Mr Y would have co-operated had CSA responded to him as they should. I find that there is insufficient evidence for me to conclude that Mr Y returned a completed maintenance enquiry form before 29 April 1994. I note that the original of his letter of 25 February 1994, held on CSA’s file, did not bear the endorsement “Form sent” (paragraph 12.25). Furthermore the only evidence of recorded delivery mail having been sent by Mr Y in 1994 concerned his letter of 7 May. Finally there is no contemporarily completed enquiry form on file, nor any mention by CSA or by Mr Y himself of such a form. In my view the then Chief Executive’s comments on this matter (paragraph 12.28) are reasonable. I conclude that the interim maintenance assessment was not deficient in a technical sense.
12.38 Nevertheless there were many departmental failings, amounting to maladministration, subsequent to the centre’s letter of 30 April 1994, which notified the parties of the interim maintenance assessment. The centre failed to set up an account for Mr Y. They failed to contact him, as promised, about arrangements for payment. They failed to notify the county court of the (automatic) cancellation of the court order. Indeed, bearing in mind the mix-up over the effective date for child support maintenance (paragraph 12.14), it appears that they overlooked the existence of the court order altogether. If it were Mr Y’s contention on those grounds alone that the failure to answer his 1994 letters led him to believe that the interim maintenance assessment would not be implemented, then I see no reason to support that. CSA have never withdrawn the interim maintenance assessment. Nevertheless, did Mr Y have a reasonable expectation that the assessment would not be implemented given the subsequent passage of time?
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12.39 The centre had opportunities to take action in Mr Y’s case in 1995. The fact that Mr Y had changed address was not material since they had learned of his new address from his employer; but they failed to follow up the information. Similarly the limited activity I have noted for 1998 (paragraph 12.18) appears to indicate that the centre had contemplated taking some further action but again they did nothing. Finally, in 1999, the centre had made other enquiries but may have been distracted by Ms B’s apparent wish for CSA not to take any enforcement action (paragraph 12.19). As I see it, however, the centre’s duty towards an applicant in Ms B’s position was to secure payment of child support maintenance.
12.40 CSA did not communicate in any way with Mr Y between their correspondence of 30 April 1994 and 13 January 2000. During that period of 5¾ years, CSA took no effective action to put Mr Y’s case on an even keel. That was a very poor performance indeed, meriting my severe criticism. I conclude that Mr Y had every reason to believe over time that his unflagging compliance with the court order, unbroken until the centre’s belated action to cancel the order in March 2000, had discharged his obligations. Had the centre acted effectively they could if necessary have secured payments of child support maintenance under a deduction from earnings order served on Mr Y’s employer in 1994. (Mr Y has remained in a senior managerial position for the same company throughout CSA’s involvement with his case.) I discuss in paragraph 12.43 below the injustice caused to Mr Y by departmental maladministration.
12.41 I am highly critical of the centre’s actions in January 2000. Without warning they sent Mr Y a computer-generated letter saying that he owed over £29,600 and that he should pay that sum within a week. By any standards that was utterly insensitive and unreasonable. To make matters worse the centre failed first to determine whether Mr Y had made any voluntary payments during the period in question and they used a wrong effective date. I consider that, at the very least, Mr Y deserved to be contacted and given proper explanations for the position in which CSA found themselves, however awkward or embarrassing, and to receive apologies for departmental mishandling.
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12.42 Finally I mention briefly other shortcomings by CSA. The centre were wrong to tell Mr Y that the cancellation of the court order was for him to pursue. CSA have apologised for that. The centre also continued to refer in correspondence to a wrong effective date for child support maintenance. And there have been muddles about the amounts Mr Y is currently required to pay under an arrangement with the centre, and mistakes in addressing letters to him. As I see it those shortcomings reinforce the impression that CSA have consistently failed to deal with Mr Y in a professional way.
12.43 I now turn to redress. It is not difficult to imagine that CSA’s “out of the blue” demand for some £29,600 must have been extremely upsetting for Mr Y and his family. I regard the CSA’s recent award of £900 to compensate for the aggravation and stress caused by their actions (paragraph 12.35) to be reasonable in all the circumstances. However I do not regard that compensation as nearly sufficient. In the light of my main finding at paragraph 12.40 above I put it to the new Chief Executive that it would be manifestly unfair to expect Mr Y to pay the arrears that had accumulated under the interim maintenance assessment. At a rate of clearance of £100 a month it would take Mr Y around 18 years to discharge the arrears as currently identified. He would plainly not have been in such a position were CSA to have served a timely deduction from earnings order on his employer. I asked the Chief Executive to consider making a significant gesture in that respect. In reply the Chief Executive said that, in the particular circumstances of Mr Y’s case, CSA had decided to offer deferment (paragraph 12.8) of child support maintenance for the initial payment period from 4 February 1994 to 21 January 2000. Taking into account the voluntary payments already made, CSA had calculated that arrears of £17,219.20 could be deferred, leaving Mr Y liable to pay £1,935.69 for the last 26 weeks (the period from 24 July 1999 to 21 January 2001). They proposed to allow Mr Y to clear that liability by increasing his arrears agreement to £161.35 a month over 12 months. (In due course CSA should effectively write off the deferred arrears.) I welcome that positive development.
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Conclusion
12.44 CSA handled Mr Y’s case badly. I regard CSA’s revised consolatory payment of £900 and their recent decision to defer arrears of child support maintenance of £17,219.20 to be a satisfactory outcome to a fully justified complaint.
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