The DWP CMS GB 2012 scheme was introduced to reform child maintenance in the UK, replacing earlier systems that lacked efficiency and enforcement.

Operated by the Child Maintenance Service under the Department for Work and Pensions, the scheme ensures that separated parents contribute financially to their children’s upbringing.

With structured payment options, compliance measures, and digital integration, it aims to streamline processes while holding non-compliant parents accountable. This article explores the scheme’s rules, payments, responsibilities, and overall performance.

What Is The DWP CMS GB 2012 Scheme And How Does It Work?

The Child Maintenance Service (CMS), part of the Department for Work and Pensions (DWP), operates the 2012 statutory child maintenance scheme across Great Britain.

The DWP CMS GB 2012 scheme was introduced to simplify and streamline the child maintenance process after criticism of the earlier Child Support Agency (CSA) systems from 1993 and 2003.

These legacy systems were often regarded as complex, inefficient, and lacking in enforcement capability.

The 2012 scheme was designed to provide a modern approach to child maintenance. It encourages separated parents to make private, family-based arrangements wherever possible.

If that fails, the CMS provides statutory support through calculated assessments and enforcement mechanisms.

The CMS 2012 scheme works by assessing the Paying Parent’s gross income, establishing the amount due, and facilitating or enforcing payments based on the service type chosen.

Payments are either made directly between parents or collected through the CMS and distributed to the Receiving Parent.

The scheme aims to promote fairness, reduce conflict, and ensure children receive financial support from both parents.

Who Is Responsible For Managing Child Maintenance Under The 2012 Scheme?

The Department for Work and Pensions (DWP) oversees the child maintenance framework.

Within the DWP, the Child Maintenance Group (CMG) is tasked with administering client funds, ensuring accurate assessments, and supporting the delivery of statutory services.

The main stakeholders involved include:

• Paying Parent (PP): Responsible for making regular payments
• Receiving Parent (RP): Receives the payments for the child’s upbringing
• CMS (via CMG): Provides calculation, collection, and enforcement services

The CMG operates as a custodian of client funds, ensuring accuracy, compliance, and transparency in financial operations. Annual reports are submitted and audited to confirm that all child maintenance receipts and payments are properly managed and recorded.

What Are The Main Service Types Under The CMS 2012 Scheme?

The CMS 2012 scheme is structured to offer flexibility while enforcing responsibility. There are two distinct service types:

Direct Pay

Direct Pay is the preferred option where cooperation between parents is possible. CMS assesses the amount of maintenance due and shares this with both parents.

However, the actual transfer of money is arranged between them without CMS intervention.

This model avoids additional service fees and is often quicker. It also promotes responsibility and communication between parents.

CMS does not track payments in Direct Pay cases unless the Receiving Parent reports non-payment.

Collect And Pay

This service is used when the Paying Parent is unwilling or unable to comply voluntarily. CMS intervenes by collecting maintenance payments directly and transferring them to the Receiving Parent. This method includes additional charges:

• The Paying Parent pays an extra 20% of the maintenance amount
• The Receiving Parent loses 4% of the amount collected

CMS actively monitors payments under this service, and failure to comply results in enforcement action.

Below is a comparison of both services:

Feature	Direct Pay	Collect and Pay
CMS Calculates Amount	Yes	Yes
CMS Handles Payments	No	Yes
Extra Charges	No	Yes (PP: +20%, RP: -4%)
Enforcement Action	Only if RP reports non-payment	Automatic
Monitoring	Not by default	Active monitoring

How Are Child Maintenance Payments Calculated Under The DWP CMS GB 2012 Scheme?

The calculation of child maintenance is primarily based on the Paying Parent’s gross weekly income. This income is verified through data supplied by HM Revenue & Customs (HMRC).

There are five main calculation rates:

1. Nil Rate: For parents earning below £7 per week or receiving benefits
2. Flat Rate: £7 per week for those on certain benefits
3. Reduced Rate: For weekly income between £100 and £200
4. Basic Rate: For income between £200 and £800
5. Basic Plus Rate: For income above £800 per week

Adjustments are made depending on:

• Number of children involved
• Shared care arrangements (overnight stays)
• Any other children the Paying Parent supports

Calculation Process

CMS uses an automated system to retrieve income details and apply the appropriate rate. Parents can request a variation if they believe the reported income does not reflect the Paying Parent’s actual financial situation.

Variations can be considered for unearned income, property, or if the Paying Parent is deliberately underreporting earnings.

What Were The Key Changes Introduced During The Covid-19 Pandemic?

The pandemic had a significant operational impact on the CMS. Many staff were redeployed to support the surge in Universal Credit applications.

During this period, CMS maintained a minimal level of service to continue providing essential child maintenance functions.

Key temporary adjustments included:

• Accepting new applications only through the online portal
• Reducing the threshold for reassessing income changes from 12 weeks to 2 weeks
• Suspending enforcement actions and CSA case closures
• Accepting verbal evidence for changes in circumstances
• Prioritising provisional calculations to speed up payments

From July 2020, CMS began reinstating its full service levels. By September 2020, most staff had returned to their CMS roles.

Enforcement activities resumed, with court hearings for over 90% of previously suspended cases being successfully scheduled between September and December.

CMS also encouraged greater use of digital tools such as the online account portal and My Child Maintenance Case dashboard to minimise telephone service usage during the recovery phase.

How Does The CMS Enforce Unpaid Child Maintenance?

CMS possesses a wide range of enforcement powers to ensure child maintenance is paid. If a parent fails to pay under either service type, various actions can be taken.

Enforcement Actions Include:

• Deduction from Earnings Orders (DEOs): Employers deduct money directly from wages
• Deduction from Bank Accounts: Direct withdrawal from bank or building society accounts
• Liability Orders: Legal orders enabling further enforcement such as:
  • Use of Enforcement Agents (bailiffs)
  • Application of charging orders on property
  • Disqualification from driving or holding a passport
  • Imprisonment in extreme cases

Financial Investigations

CMS refers complex or suspicious cases to its Financial Investigations Unit (FIU). This team investigates:

• Self-employed individuals hiding income
• Business owners misreporting revenue
• Situations where DEOs are repeatedly unsuccessful

The goal is to ensure maintenance assessments reflect the true financial capacity of the Paying Parent.

What Is The Role Of The Client Funds Account In The CMS 2012 Scheme?

The Client Funds Account is an independently reported financial record that details all receipts and payments made under the Collect and Pay service. It does not include Direct Pay transactions as those are not handled by the CMS.

This account is required under the Government Resources and Accounts Act 2000 and is audited annually.

It provides a breakdown of funds received, fees collected, refunds issued, and outstanding balances.

Key Figures From 2020/21:

• Receipts from Paying Parents: £170.4 million
• Payments to Receiving Parents: £165.4 million
• Unpaid Maintenance: £408.5 million
• Cash Balance at Year-End: £11.3 million

These figures are reviewed by the Comptroller and Auditor General, who issued an unmodified opinion, indicating a high standard of financial control and reporting.

How Effective Has The CMS 2012 Scheme Been In Improving Compliance?

The 2012 scheme introduced streamlined processes, more efficient systems, and a culture of enforcement to boost compliance.

By March 2021:

• 72% of Collect and Pay cases were contributing
• 769,600 children were covered under CMS
• Compliance levels were the highest since the scheme’s inception

CMS attributes this success to a policy called Total Enforcement, which ensures that every staff member plays a role in encouraging compliance throughout the lifecycle of a case.

Maintenance Paid Between Parents:

Year	Direct Pay (£m)	Collect and Pay (£m)	Total (£m)
2019/20	742.2	191.6	933.8
2020/21	783.6	189.1	972.7

These figures assume full compliance in Direct Pay cases unless a dispute is raised.

How Are Outstanding Arrears And Write-Offs Managed Under The Scheme?

Unpaid maintenance is a growing concern, although CMS continues to address this through enforcement and surveillance.

As of March 2021:

• Total arrears stood at £408.5 million
• 51% of this amount was actively pursued through enforcement
• 6.9% was under surveillance due to inability to pay
• Remaining amounts were either pending action or not yet due

In 2020/21:

• £9.3 million was written off as part of routine operations (e.g. death of PP, RP decision not to pursue)
• A further £10.6 million was projected to be written off in 2021/22

Some older cases, particularly those over 12 months with no recovery, were reviewed for potential classification as uncollectable. These were assessed by third-party investigators to evaluate collection feasibility.

What Are The Statutory Fees And Charges Associated With The Scheme?

The CMS 2012 scheme recovers part of its administrative costs through statutory fees and charges, which include:

• £20 application fee for new CMS cases
• 20% collection fee from the Paying Parent (Collect and Pay service)
• 4% deduction from the Receiving Parent (Collect and Pay service)
• Additional enforcement charges applied in cases requiring legal intervention

In 2020/21, CMS collected £44.9 million in fees. These funds were passed to the Secretary of State and used to offset administrative expenses associated with managing the scheme.

How Has Digital Transformation Improved CMS Operations?

Digital transformation has significantly improved the efficiency and accessibility of CMS services. Recognising a shift in customer preferences, CMS invested in new technologies and online platforms to reduce reliance on traditional communication.

Key Developments:

• My Child Maintenance Case: An online portal for reporting changes, checking case status, and making payments
• Online Application Services: Streamlined application process with quicker assessments
• Children Analytical Data Service (ChADS): A powerful data and analytics platform for internal performance monitoring

The shift to digital was accelerated during the pandemic, and these systems are now a core part of CMS’s customer engagement strategy. The ability to submit changes online and communicate through secure portals has reduced call volumes and increased responsiveness.

What Governance And Compliance Measures Support The CMS 2012 Scheme?

CMS governance is embedded within DWP’s broader compliance and accountability framework. These measures include:

• Annual audits by the National Audit Office
• Adherence to HM Treasury’s financial reporting guidelines
• Internal monitoring systems to detect and prevent fraud

To maintain data protection standards, CMS follows the UK GDPR, and data retention policies have been updated to ensure relevant financial records are kept for audit purposes.

In 2020/21:

• 15 data breaches relating to CMG were reported to the Information Commissioner’s Office
• All breaches were investigated, and corrective training was provided to staff
• Audit trails and internal monitoring tools were improved to enhance transparency

Conclusion

The CMS 2012 Scheme, under the DWP, has made considerable progress in delivering an effective, enforceable, and transparent child maintenance system.

Compliance has improved, debt recovery remains strong, and digital transformation continues to streamline services.

While challenges remain particularly in addressing long-term arrears and maintaining service during external disruptions the system demonstrates resilience, with governance structures and audit standards providing accountability.

The DWP’s commitment to continual improvement suggests the scheme is on track to fulfil its objectives: ensuring children receive the financial support they are owed.

Frequently Asked Questions

What is the difference between Direct Pay and Collect and Pay?

Direct Pay involves parents handling payment arrangements directly, while Collect and Pay is used when the CMS steps in to collect payments from the Paying Parent and deliver them to the Receiving Parent, with additional fees involved.

Can CMS take money directly from a bank account?

Yes, CMS can issue a Deduction Order to take money directly from a bank or building society account if the Paying Parent fails to meet their obligations.

How does CMS handle child maintenance arrears?

Arrears are managed through enforcement actions, payment plans, or write-offs if legally justified. CMS uses tools like court orders, wage deductions, and even passport confiscation to recover unpaid maintenance.

Are Direct Pay payments monitored by CMS?

CMS assumes Direct Pay payments are made on time unless the Receiving Parent reports missed payments. If confirmed, the case may shift to Collect and Pay for enforcement.

Is child maintenance taxable income?

No, child maintenance payments are not considered taxable income for the Receiving Parent, nor are they tax-deductible for the Paying Parent.

What should I do if my income changes significantly?

You should inform CMS immediately. The service can reassess your payments based on new income information, especially if your income changes by 25% or more.

How long does CMS keep client data?

Under GDPR, client data is retained for 14 months after a case closes. However, this has been updated to ensure audit requirements are met without compromising data protection laws.