A new computer system for the Child Support Agency (CSA) is �50 million over budget and is likely to be delayed until next summer, the BBC has learned.

The set-up is needed to ensure delivery of the government's long-awaited reform of the CSA.

The hold-up means hundreds of thousands of families are suffering because payments are taking too long to work out - and collect.

The system was designed to help speed up the calculation of payments as well as collection times and was due to go into operation in April.

The agency costs �290m a year to run

Technical problems meant a new deadline was set but this too has now passed, and sources say next summer is now looking more likely for the launch.

Insiders also told the BBC the project is at least �50m over budget - a quarter of the �200m total.

The contract to provide the new technology was awarded to the Texas-based company EDS, under a Private Finance Initiative (PFI).

The BBC's business correspondent Rebecca Pike says the terms of the contract mean it is not clear who pays for the budget overspend.

Critics say it could end up being the taxpayer, thereby undermining one of the main points of PFI - that the risk of things going wrong is transferred to the private sector.

Compensation

The revelations come less than a month after calls were made to disband the agency when it emerged that more than �2bn owed by absent parents towards their children's upbringing had been written off.

The CSA, which costs about �290m a year to run, has been dogged by controversy during its nine-year history.

Mistakes have led to millions of pounds in compensation payments to disgruntled parents, wrongly asked to pay either too much or at all.

Established to settle maintenance for children of separated parents, it aims to ensure that absent parents are held financially responsible for their children.

It replaced the court system which was finding problems dealing with the increasing amount of cases it was facing.

But the complicated formula needed to work out payments has led to mistakes and delay, causing much misery and anger.

In some cases, absent parents have been overcharged, but in others - such as that of self-employed people - as many as 80% have avoided paying all the money they should because of loopholes in the system.