30 September 08 – Publication of DWP research report 530: informing the piloting of deduction from earnings orders as the primary method of collecting Child Maintenance
New research on the views and concerns of employers on the use of Deduction from Earnings Orders (DEOs) as the primary means of collecting child maintenance (compulsory DEOs), is published today by the Department for Work and Pensions. This research aimed to build up a picture of likely employer worries and concerns over this new approach with DEOs. These findings would both inform piloting of DEOs as the primary means of collecting child maintenance and how the new Child Maintenance and Enforcement Commission can alleviate and respond to employer concerns.
This report presents findings from a quantitative survey of over 1,500 UK employers. Employers included those who currently operate DEOs and those with no experience of operating DEOs.
The main findings are:
- Employers generally support the idea of DEOs. Over a half (54%) thought DEOs should be used to collect all child maintenance. However, there was greater support for the way DEOs are currently used, where non-resident parents (NRPs) have failed to pay.
- Over three quarters (76%) of employers had no immediate concerns about the introduction of compulsory DEOs.
- Where employers were able to estimate the time and cost of setting up and administering compulsory DEOs, generally estimates were fairly low – (less than £5 and less than 15 minutes). Larger companies, with systems already in place, were least concerned about the cost implications of compulsory DEOs.
- Just over one in ten employers would cover the costs themselves, but 43% expected the government to. Those with previous DEO experience were less likely to fall into this latter category (34% compared to 53% with no DEO experience).
- Overall, employers felt their payroll and IT systems would support compulsory DEO payments (81% with electronic package). Large companies with custom built IT packages, would be best able to adapt to changes to their systems.
- Cost and time implications of compulsory DEOs could be a burden for micro companies, as third of those who administer their payroll in-house (74%), do so manually.
Notes to Editors
- The White Paper ‘A New System of Child Maintenance’ (HMSO, December 2006), made a number of commitments including the development of a new Child Maintenance and Enforcement Commission (the Commission), which will oversee child maintenance arrangements. The Commission will have the tools to establish the reliable collection of child maintenance payments as soon as possible and powers to take firm enforcement action at the earliest opportunity against non-resident parents who fail to fulfil their obligation to pay maintenance. The White Paper also included a commitment on legislation to pilot the use of Deduction from Earnings Orders (DEOs) as the primary means of collecting maintenance from those in employment. (A DEO is currently used in circumstances where a non-resident parent is failing to or not likely to comply with another method of payment, such as a direct debit). The Government responded to stakeholder consultation on the White Paper by committing to carry out research to inform the most effective way to pilot the use of DEOs as the primary means of collecting maintenance.
- The research is based on a quantitative survey with 1503 UK based employers covering micro, small, medium, and large sized companies across a range of industrial sectors. The survey also included an artificial equal split of employers - those who already had experience of DEOs and those who do not - to enable comparison of responses by level of experience of operating DEOs.
- Research Report 530: “Informing the piloting of Deduction from Earnings Orders as the primary method of collecting child maintenance”, is published on 30th September 2008. The report is available on the DWP website.
Media Enquiries: Liz Forster 020 3267 5122
DWP Press Office: 0203 267 5144
Out of hours: 07659 108 883
Website: www.dwp.gov.uk
Prepared by: Department for Work and Pensions Child Support Agency
