Financial rights of unmarried parents

Justin Creed, legal director in the Family Law team at Lodders, outlines the options available under Schedule 1 of the Children Act 1989 for parents who separate after cohabiting.

Legal remedies under the Children Act 1989

According to recent data from the ONS, cohabiting couples with children made up 18% of all families in the UK in 2023, up from 15% in 2013. Cohabiting couples are now the fastest growing family type in the UK, accounting for one in five families, and children in these households are statistically more likely to experience a parental separation than those in married households.

In a recent blog, we discussed the “patchwork” of legal rules presently available to co-habiting couples who separate and the growing call for reform in the law. One area of the law that does remain relevant to these families, though often overlooked, is Schedule 1 of the Children Act 1989. This part of the Act allows certain financial claims to be made for the benefit of children when their parents separate, even if those parents were never married or in a civil partnership.

Where cohabiting parents separate, there is often a misconception that financial claims are limited or unavailable. In reality, Schedule 1 provides a mechanism to secure financial support, although only for the benefit of the child rather than their parents directly.

Schedule 1: Who can apply and what can be claimed?

Schedule 1 claims can be made by parents, legal guardians, special guardians, or anyone with a residence order in respect of a child. The available remedies include:

• Regular maintenance payment, although most ongoing maintenance is dealt with by the Child Maintenance Service (CMS)
• Lump sum payments for the benefit of the child
• Orders for the transfer or settlement of property for the child’s benefit
• Additional maintenance to cover specific costs, such as school or nursery fees

It is worth noting that these remedies are aimed at supporting the child’s needs. While a parent with care may indirectly benefit – for example, by living in a property provided for the child – they do not gain ownership or long-term rights in respect of that property.

Property and capital claims

In practice, these types of claims often arise where one parent has significant financial resources and the parent with care has limited means. The court has the power to order the wealthier parent to provide capital for housing, either by transferring a property or funding a purchase. However, this is not a permanent arrangement; typically, once the child reaches the age of 18 or finishes full-time education, the property will revert to the paying parent.

It is also possible for lump sums to be awarded to cover specific expenses. Examples from case law include furnishing a home, buying a car, covering medical costs or repaying debts incurred for the child’s benefit.

Additional maintenance can also be ordered over and above that which is assessed by the CMS if the paying parent’s income is above the CMS gross limit

The court can also award maintenance to cover nursery or school fees.

The court’s discretion

When considering applications, the powers of the court are discretionary. It must take into account a range of factors, including:

• Each parent’s income, earning capacity, property and other financial resources
• Their financial needs, obligations and responsibilities
• The child’s own needs and resources
• Any physical or mental disability of the child
• The child’s education or training

There is no formula or set outcome. Each case is decided on its own facts, with a focus on ensuring the child’s welfare is properly supported.

Essential support

The legal framework under Schedule 1 of the Children Act is not necessarily well known but represents one of, if not the only, option to separating cohabitating parents with children, pending a substantive change in the law. While the law is limited in scope, it can offer essential support where one parent is unable to meet housing or other key needs for the child.

Legal advice should be sought early, as these applications can be complex and fact specific. At Lodders, our Family law team regularly advises on Schedule 1 claims and helps parents navigate the options available.

For more information, or to speak with a member of our team, please get in touch.