Showing posts with label CMS. Show all posts
Showing posts with label CMS. Show all posts

2026/09/03

The Staggering Cost to the Taxpayer



 

Child Maintenance Service Fees Raised £235 Million — Yet Taxpayers Still Paid at Least £367 Million

The Child Maintenance Service charges substantial fees when parents use its Collect and Pay service.

Paying parents are charged an additional 20% on top of their child maintenance liability, while receiving parents lose 4% of the maintenance collected for their children.

These charges are supposed to contribute towards the cost of running the service. But how much do they actually cover—and how much does the taxpayer still pay?

Official Department for Work and Pensions figures reveal that, between 2019/20 and 2023/24:

  • Core CMS operations cost approximately £602 million.

  • Collect and Pay fees generated approximately £235.4 million.

  • After deducting those fees, the estimated cost to taxpayers was still approximately £366.6 million.

In other words, Collect and Pay fees covered only around 39% of the CMS’s core operating expenditure during these five years. Taxpayers effectively covered the remaining 61%.

CMS costs and fees by year

All figures are in millions.

Financial yearCore CMS operating costPaying-parent feesReceiving-parent feesTotal Collect and Pay feesEstimated taxpayer cost after fees
2019/20£146.2m£34.8m£6.8m£41.6m£104.6m
2020/21£115.1m£34.2m£6.7m£40.9m£74.2m
2021/22£120.7m£38.5m£7.5m£46.0m£74.7m
2022/23£104.1m£41.3m£8.0m£49.3m£54.8m
2023/24£115.9m£48.2m£9.4m£57.6m£58.3m
Total£602.0m£197.0m£38.4m£235.4m£366.6m

The underlying figures were supplied by DWP in a parliamentary answer published on 9 June 2025.

The estimated taxpayer cost has been calculated by subtracting the reported Collect and Pay fee income from the reported core operating expenditure.

Parents paid almost £200 million in 20% charges

The largest source of fee income was the additional 20% charged to paying parents.

Across the five years, paying parents contributed approximately:

£197 million

Receiving parents lost a further:

£38.4 million

This produced combined Collect and Pay fee income of:

£235.4 million

This money was collected in addition to the child maintenance intended to support children.

For every £100 of maintenance collected through Collect and Pay:

  • The paying parent can be required to pay £120.

  • The receiving parent receives only £96.

  • The government can therefore collect up to £24 in combined fees.

The fee is charged only when money is successfully collected.

Are CMS fees covering more of its costs?

The proportion of core operating costs covered by fees has increased considerably.

Financial yearPercentage of core costs covered by fees
2019/2028.5%
2020/2135.5%
2021/2238.1%
2022/2347.4%
2023/2449.7%

By 2023/24, fees were equivalent to almost half of the narrowly defined core operating costs.

However, that does not mean parents funded half of the CMS’s total economic cost.

The true taxpayer cost is probably higher

The DWP figures exclude several important categories of expenditure, including:

  • Digital services and technology

  • Buildings and estates

  • Other central DWP overheads

  • Some modernisation and transformation expenditure

The estimated £366.6 million taxpayer contribution is therefore a conservative figure.

It represents the remaining cost after fees have been deducted from core CMS operational spending. It does not represent every public cost associated with maintaining, developing and supporting the service.

The National Audit Office previously reported that the net cost of running the wider Child Maintenance Group was £322 million in 2020/21. That broader figure included activity and costs falling outside the narrower operational definition used in the parliamentary answer.

The National Audit Office’s 2022 Child Maintenance report also found that DWP had not achieved the reduction in administrative costs originally anticipated.

What happened in 2024/25?

The CMS Client Funds Account records £70.8 million in non-child-maintenance receipts during 2024/25, compared with £60.6 million in the preceding year.

However, this figure is broader than the Collect and Pay fees shown in the main table. It principally includes collection and enforcement charges but can also contain other non-maintenance receipts.

DWP has not published a directly comparable core operating-cost figure for 2024/25 alongside it. It would therefore be misleading to add the £70.8 million to the five-year total without further information.

The figure is available in the 2012 Child Maintenance Scheme Client Funds Account for 2024/25.

Why can’t we go further back?

The Child Maintenance Service began in December 2012, replacing the Child Support Agency. Collect and Pay fees were introduced in 2014.

In theory, this means a financial comparison should be possible from 2014/15 onwards.

The problem is that DWP did not maintain a clean separation between the operating costs of the new CMS and those of the remaining CSA schemes during the transition.

The National Audit Office reported that DWP was unable to separate the costs of the Child Support Agency schemes from those of the Child Maintenance Service.

Historical figures describing the cost of the statutory child-maintenance system therefore include a mixture of:

  • CMS cases

  • Remaining CSA cases

  • Closing the old schemes

  • Managing historic CSA arrears

  • Transition and reform expenditure

Using those figures as though they related solely to CMS would create a misleading comparison.

A Freedom of Information request is now needed for equivalent CMS-only figures covering 2014/15 to 2018/19, together with the complete figures for 2024/25.

Did Collect and Pay fees achieve their purpose?

The government introduced the charges for three principal reasons:

  1. To contribute towards the cost of the service.

  2. To encourage parents to make private family-based arrangements.

  3. To encourage paying parents to pay voluntarily through Direct Pay.

The figures show that the fees have made a substantial financial contribution. They generated more than £235 million over five years and covered a growing share of narrowly defined operating expenditure.

But this raises an important policy question.

Many families use Collect and Pay because payments have already failed or because direct financial contact between the parents may be unsafe or inappropriate. Receiving parents can therefore lose 4% of money intended for their children because the other parent has not paid reliably.

At the same time, the additional 20% charge can make an already difficult debt substantially harder for the paying parent to clear.

Despite imposing these charges on both parents, the service still required an estimated taxpayer subsidy of at least £366.6 million over five years—and that calculation excludes major central, digital and property costs.

The bottom line

Between 2019/20 and 2023/24, parents paid approximately £235.4 million in Collect and Pay fees.

Nevertheless, after those fees were taken into account, taxpayers still contributed an estimated £366.6 million towards core CMS operations.

The full public cost was almost certainly higher because the published operational figures exclude digital, estates and central DWP expenditure.

The essential figures are:

  • Core CMS operating expenditure: £602 million

  • Collect and Pay fees: £235.4 million

  • Estimated taxpayer cost after fees: £366.6 million

  • Core costs recovered through fees: 39%

  • Core costs left to taxpayers: 61%

The government is entitled to argue that the fees offset some of the cost of providing Collect and Pay. But it should publish a complete annual account showing exactly what the CMS costs, how much parents contribute through every type of fee and how much taxpayers ultimately pay.

Without that transparency, neither Parliament nor parents can properly judge whether the Child Maintenance Service is delivering value for money.

2026/02/14

What Happens When Your Child Leaves Education:

When Does Child Maintenance Stop? What Happens When Your Child Leaves Education

Understanding Child Benefit, Education Status, and Child Maintenance Rules in the UK

Every summer, thousands of UK families face an important transition when a child finishes school, college, or training. Alongside lifestyle changes, there are major financial questions — particularly surrounding child maintenance payments and Child Benefit eligibility.

If you're wondering when child maintenance stops, how education affects payments, or what happens after GCSEs or A-levels, this guide explains everything clearly.


How Child Benefit and Child Maintenance Are Connected

In most UK cases, child maintenance ends when Child Benefit stops. The Child Maintenance Service (CMS) uses Child Benefit eligibility rules to decide whether a child is still considered financially dependent.

If Child Benefit continues, child maintenance usually continues. When Child Benefit ends, maintenance payments normally stop as well.

Watch: How Child Maintenance and Child Benefit Are Linked

Eligibility typically depends on whether the young person remains in full-time approved education or training.


When Does Child Benefit Automatically Stop?

Child Benefit claims automatically include a preset end date when a child turns 16. Payments normally continue until:

👉 31 August following the child’s 16th birthday

If Child Benefit is not extended before this date, payments stop automatically. Child maintenance payments usually end at the same time.

Importantly:

  • Payments continue until 31 August even if the child stops attending school.

  • Children under 16 are still classed as financially dependent regardless of attendance.

Related Video: When Child Maintenance Stops After Education Ends



If a young person continues in further education, Child Benefit can be extended. The new end date moves to the next official quarterly terminal date after their course finishes.

UK Child Benefit Terminal Dates

  • 28/29 February

  • 31 May

  • 31 August

  • 30 November

For example, if education finishes in June, Child Benefit usually continues until 31 August unless the young person starts full-time work earlier.

Young people are still classed as being in education until their final exams finish. For GCSEs and A-levels, this usually means mid-to-late June.






When Must Parents Inform HMRC About Education Changes?

Many parents believe they must always report when education ends. This is not always required.

Parents only need to notify HMRC if the young person:

  • Leaves education early

  • Starts working more than 24 hours per week before the next terminal date

  • Begins claiming benefits independently

If none of these apply, Child Benefit usually continues automatically until the next scheduled end date.

Failing to report early changes may result in overpayments or potential fraud investigations.


The 20-Week Extension Rule for 16-17 Year Olds

Child Benefit may continue for up to 20 additional weeks for young people aged 16 or 17 who:

  • Register with a careers service

  • Are waiting to start military service

  • Are between education or training placements

During this extension period, child maintenance usually continues.


Myth: Working Over 24 Hours Stops Child Maintenance

A common misconception is that working over 24 hours per week automatically stops Child Benefit or child maintenance.

This is incorrect.

There is no limit on working hours while the young person remains in full-time approved education. The 24-hour threshold only applies once education has ended.


What Happens After Child Benefit Stops?

Government systems regularly check Child Benefit status for young people aged over 16.

If Child Benefit stops:

  • CMS automatically reviews child maintenance eligibility.

  • Parents paying maintenance can also report changes themselves.

  • If Child Benefit is still active, CMS usually rejects early change requests.



Different Rules Depending on the Child’s Age

When the Young Person Is Over 18

If Child Benefit ends after age 18, the young person is normally removed automatically from child maintenance calculations unless:

  • Other case changes are pending

  • Income reassessments are still being processed

Delays are common if multiple case updates are underway.


When the Young Person Is Under 18

For children under 18, CMS normally:

  1. Contacts the parent receiving Child Benefit

  2. Allows 7 days to confirm education status

  3. Runs a final Child Benefit check before closing the case

If Child Benefit restarts, child maintenance normally continues.


What Happens When a Child Is Removed From a CMS Case?

When a child is removed:

  • Maintenance payments for that child stop

  • Payments may be recalculated if other children remain eligible

  • Arrears still need to be paid if outstanding

If no other children remain and no arrears exist, the case will eventually close. Full closure can take several weeks as it is often processed manually.


Timing Matters When Reporting Changes

Many parents try to report education ending too early. This often leads to rejected change requests and delays.

If Child Benefit remains valid until a scheduled terminal date, CMS will normally reject any early case closure requests.

Waiting until Child Benefit officially ends helps avoid processing delays.


Why CMS May Reject Requests to Stop Child Maintenance

Requests may be rejected if:

  • Child Benefit remains active

  • A 20-week extension has been granted

  • Education ended but HMRC was not notified

  • Course extensions remain on record

  • System updates have not yet been processed

Government systems may take several weeks to update across departments.


Final Thoughts: Understanding Child Maintenance Rules When Education Ends

Understanding how Child Benefit and education status affect child maintenance can help parents avoid confusion, disputes, and delays.

Key points to remember:

✔ Child maintenance usually follows Child Benefit rules
✔ Education status determines payment eligibility
✔ Terminal dates control when payments stop
✔ Timing is crucial when reporting changes

Staying informed helps ensure smoother case transitions for both paying and receiving parents.


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Learn when child maintenance stops in the UK and how Child Benefit, education status, and terminal dates affect payments. Complete guide with expert explanations and video support.

2022/12/26

How To Pay Child Maintenance.

                                                


This article assumes that an application has been made to the Child Maintenance Service (CMS) and that a schedule of payments has been issued by the CMS.

So you have received the payment schedule and you are wondering what to do next.  First thing to do, is to read the schedule.  It might say you have to pay £50 per week, but there might be arrears meaning that you have to pay £55 per week.  So skip past the headline figure and go to the table where it says on what day you have to pay and how much.  


Its common to have arrears at the beginning of a case.  This is because payments are calculated from the date the case is opened, but there could be a two week delay as the CMS collect details and produce a schedule.

All arrears are normally paid off over the course of the year.  So make sure you are following the schedule so that the arrears disappear over the year.  Never pay the arrears figure.  Ignore it.  Only pay the payment figure.

Here are the tips for paying.

1.  Rule number one is never pay cash, unless the other person is going to sign for it. 

2.  Rule number two is never pay by cash, even if the other person signs for it!

3.  Pay by standing order so you never miss a payment.

4.  If you cant pay by standing order, pay by bank transfer.  Set a weekly alarm on your phone so you dont forget.

5.  Dont use the childs name as the reference.  It could be argued, its a gift.  For the reference, make sure you put CMS or Child Maintenance

6.  Use the parents Name for the Name to pay to followed by Maintenance if there is room.
  

        ie.   Amy Short maintenance

If you follow steps 5 and 6 it should show on the bank statement of the receiving parent as 

               Amy Short Maintenance CMS 

7    Use one bank account to make payments from.  Dont use it for anything else.  At some point you may have to use the statement to prove payments.  You don't want others to see your salary and expenditure.

8   Pay the exact amount due, on the day it is due.  Never pay late or early.

9.  
When you first speak to the CMS they will arrange a payment schedule and will ask you what frequency you want to pay.  Avoid paying on Mondays due to the large number of bank holidays, as that means you will be late at least 5 times per year.  Also consider avoiding a Friday schedule unless you get paid on a Friday.  At least one Friday per year is a bank holiday, ie Good Friday.  Sometimes Christmas Day, Boxing and New Years Day are also on Fridays.

10  If you dont know the account to pay it to, ask the CMS to log the fact you don't have the account details.  They will get them for you.  Chase daily until you have the bank details.  If you do not have the bank details within two weeks, ask the CMS to close the case as the other partner is being non compliant.  Save the money until you have the details and then pay it.

11  Don't pay online via the portal.  It wont get to the other parent on time, so you will be late, and you may be charged up to 20% for doing so.

12  Tick the payments off of your payment schedule as you make them.

13  If you receive a salary increase, pay some of the salary to the account so that you have the money ready when the payments are revised upwards.  

14.  Do not arrange to pay the day before pay day if you struggle to budget.  If you are paid weekly on a Friday, don't agree to pay every Thursday as you will be late at some point if you have spent too much money.  If you arrange to pay monthly, don't ask to pay on the 28th of the month if you get paid on the last day of the month.


15.  If you pay monthly, choose a day between the 1st and the 28th.

16.  Child Maintenance is a priority bill.  Do not forget to pay or you could be put onto a DEO.  That will cost you 20% more money.

17.  Only pay what the schedule says.  Build up a reserve in case your payments are increased.  You will get no future credit for underpaying or being late in the future even if you paid extra previously.

18.   If in arrears and a schedule is arranged.  Demand to pay arrears off at £5 a week, dont over commit yourself.  

2020/08/20

What is Child Maintenance

In the UK, there is actually no legal requirement to pay child support (although of course, there is a moral arguement) and many parents come up with their own agreement.  This could take the form of parents absorbing their own costs when the child is in their care, or one party paying for things, whilst another person contributes another way.  The vast majority of seperated families, do not use the Child Maintenance Service.  

However in cases where thats not possible there are three ways to obtain child support payments.  All three methods impose legal commitments on one parent to provide child support to the other parent.  

Options for child support are:

1.    Apply to court if paying parent earns over £156,000 per year.

2.    Agree via a divorce consent order.

3.    Apply to the Child Maintenance Service.

In order to try to keep child maintenance out of the courts, courts do not deal with child maintenance below earnings of £3000 per week, equivalent to £156,000 per year.  So most families cant go to court, and are directed to the Child Maintenance Service instead.  If you are divorcing, or seeking court maintenance payments, you should probably seek advice from a divorce law firm.  CMS costs £20 to set up.  A fraction of what the best divorce lawyers would charge.

Many years ago the government introduced the Child Support Agency to administer child support.  The Child Support Agency does not exist any more, so its not possible to apply for CSA maintenance, only CMS maintenance.  (The schemes are different).

The current government department that deals with child maintenance is the Child Maintenance Service.  Shortened to CMS, the CMS can only deal with child maintenance.  It cannot produce a spousal support calculation, that would have to go to court.

If parents cannot agreee on child support, they can go to the Child maintenance Service.  Who are able to make financial arrangements for child support.  Often called the CMS, it is part of the Department for Work and Pensions in Great Britain, and the Department for Communities in Northern Ireland. 

Parents do not have to use the Child Maintenance Service, and could probably make life a lot easier if they didnt.  Parents can make their own arrangements, and do not have to tell or get the Child Maintenance Service involved.  The CMS do however have a calculator on their website that can be used to work out a child maintenance figure when parents dont use the service.   The CMS is responsible for implementing various laws concerning child support, and can pursue parents that don't pay child support.  Child support is payable until the child is 16, or until they are 20, if they are in school or at college full time.  A child over 16 that is, or has ever been married or in a civil partnership is no longer a qualifying child for child maintenance purposes.  People often refer to The Child Maintenance Service (CMS) as the CSA or Child Support Agency.  The CSA was the name given to a former agency, and that name is no longer used.  In some cases where there are outstanding CSA arrears, the CMS may be able to collect. When the CMS service is used, payments can be made using either the collect and pay service or the direct pay service. 

Direct Pay 

The CMS work out an annual payment plan that is reviewed each year which is primarily based on the gross earnings of the parent without care, with allowances made for pension contributions and regular care.  The paying parent then pays that money to the receiving parent as per the schedule worked out by the CMS.  Around 350,000 children have their maintenance paid using a direct pay arrangement.  Direct pay is free for both parents to use as the parents pay direct to each other.  The best way to do this is by a bank standing order.   The paying parent must keep to the payment schedule or they may be placed on a Deduction from Earnings Order. 

 

Collect and Pay 

The CMS collect the payment from the paying parent and pay it to the receiving parent.  Collect and Pay is not a free service, both parents pay.  They charge the paying parent 20 per cent, and charge the receiving parent 4 per cent.   Either parent can open a case with the CMS, although it is normally the receiving parent that starts the process.  The CMS will open a case and write to the other party advising them that they are the subject of a child maintenance claim.  Within three weeks they produce and assessment and the Non Resident Parent (NRP) is expected to begin payments. Where possible, it is strongly recommended that parents save money and use a direct pay arrangement.  It is better for the child if that the money goes to the receiving parent rather then being used to pay the CMS charges. Between June 2014 and March 2016 the Government received £11,298,200 in charges from parents on the Collect and pay Scheme.

Opening a Case


To open a CMS case, you need to contact Child maintenance Options, who will assess you, via chat to see if you should use the CMS.  Contact details for Child Maintenance Options and the CMS are here.

Contacting the Child Maintenance Service