Failing to pay child maintenance could affect parents' credit score

Under new rules being introduced by the Department for Work and Pensions (DWP) next year, subject to parliamentary approval, separated parents who build up arrears in child maintenance payments will see their credit score affected.

Having a poor credit rating can prevent people from taking out a loan or mortgage. It can also mean they are refused credit cards, mobile phone contracts and other forms of financial credit.

If approved by parliament, the Child Maintenance Service and Child Support Agency (CSA) will begin sharing information they hold on the payment records of separated parents concerned with them with credit reference agencies as of March 2015.

The Child Maintenance Service is to replace the Child Support Agency in the next three years.

However, information will only be shared about an individual if a liability order is made against them - a measure used as a last resort after other efforts to encourage maintenance payments have been exhausted.

The DWP says it expects the new measure will act as a deterrent to those who may otherwise have chosen to evade paying towards the upbringing of their child.

Child maintenance minister Steve Webb MP said, ‘For too long, a minority of absent parents have got away with failing to pay maintenance, leaving families without that financial support. This Government is determined to take action to tackle this kind of irresponsible behaviour and support families.

‘I would hope that we see this power used very little, because the deterrent effect of a possible negative mark on a person’s credit rating will convince those who have previously failed to pay towards their children’s upbringing to do the right thing.’

The move follows the announcement by the work and pensions secretary Iain Duncan Smith last week that all new laws and Government policies will be subject to a ‘families test’.