[2023] UKUT 238 (AAC)

Mr Najib submits that the Explanatory Memorandum to the 2012 Regulations demonstrates that the legislator intended the First Interpretation of regulation 69(3). In particular, he relies on the following paragraphs of that Memorandum (and the emphasis is his):

“Policy Background

•

What is being done and why?

7.1

Child maintenance legislation is based on the general principle that all parents take financial responsibility for all of their children. The main objective of child maintenance legislation is to maximise the number of effective maintenance arrangements for children who live apart from one or both of their parents. This is supported by two further objectives:

1.

To encourage parents to make and keep effective voluntary maintenance arrangements, to be known as family-based arrangements.

2.

To support parents in making applications for statutory child maintenance.

7.2

The 2003 scheme of child support was introduced to provide a radically simpler system than the highly complex system of calculation in the 1993 scheme.

7.3

Once the 2003 scheme had been in operation for some time it became evident that although there had been improvements from the 1993 scheme, the gathering of income information to calculate child maintenance was cumbersome and time consuming and did not allow for a quick and effective method of getting money to the children who need it.

7.4

These instruments (together with the 2008 Act) make changes in order to simplify the statutory child support scheme, improve service to customers, reduce costs to the taxpayer and increase the flow of child maintenance payments to children.

7.4.1

The majority of maintenance calculations in the new scheme will be based on gross weekly income obtained from income information provided by HMRC. Using income information provided by HMRC via an automated system request will avoid many of the delays experienced currently as a result of relying on non-resident parents to provide net income information.

…

7.4.2

A non-resident parent’s gross weekly income will be reviewed on an annual basis using income figures supplied by HMRC. This means calculations will be more cost-effective with fewer manual in-year changes being required.

7.4.3

…

7.4.4

Child maintenance legislation allows for additional financial factors to be taken into account which are not captured in the maintenance calculation; this is known as a variation to the maintenance calculation. The new statutory scheme will bring about changes to the types of variation that parents with care can claim. The intention is that grounds available to parents with care will focus on capturing a non-resident parent’s actual unearned income, such as income from savings, property and or investments rather than establishing a notional income, which is the current method of calculating unearned income. Parents with care will no longer be required to provide evidence to support a variation, as they must do currently, as in most cases information will be available from HMRC.”

In that context, Mr Najib submits that the mischief that the 2012 Regulations sought to remedy was that the need to carry out assessments in each case caused delays and that the aim behind the changes was to eliminate such delays. Reliance on information provided by HMRC enabled cases to be dealt with expeditiously and without seeking evidence from the parents. It also means that a person with care does not need to supply evidence—which she may not have—to support a variation on the ground of unearned income. The Third and Fourth Interpretations, which both require the Secretary of State to carry out her own assessment, are (it is submitted) incompatible with that policy goal and with the avoidance of disputes, which themselves cause delays.

Further, if the Secretary of State is obliged to assess in every case, what (it is asked) is the point of obtaining information from HMRC?

Rather, Mr Najib submits, the legislator has carried out a balancing act and concluded that the aims of the scheme as a whole are best achieved by accepting the information provided by HMRC in every case. He accepts that that approach will result in anomalous cases but someone in the Mother’s position has the remedy of approaching HMRC with any evidence she may have that the information provided to the Secretary of State is incorrect and asking them to give the Child Maintenance Service the correct information.