Taxpayers ‘must not suffer as HMRC faces tough decisions on future’, report says

A new report by the Public Accounts Committee (PAC) has highlighted concerns regarding customer service, Tax Credits recipients and more, as HMRC undergoes major digital change.

The report details how HMRC is undertaking 15 major transformation programmes and that with Brexit it faces additional pressures and is having to consider how to change priorities. It needs to be clear about what it will do differently, or not do, and what the impact will be on customer service, PAC says.

Together with the Treasury, HMRC has to make tough decisions on how it allocates limited resources to its operations to increase tax revenues, protect performance levels, prioritise its transformation and estate programmes, and invest in measures to tackle tax evasion, fraud and error.

The reports authors are particularly concerned about the impacts on the ordinary taxpayer from the growing challenges facing HMRC, and whether HMRC is doing enough to support vulnerable Tax Credits recipients, especially as they transfer to Universal Credit. They also remain concerned about the estate rationalisation and the lack of flexibility available as a result of decisions made. The full report can be found here.

Committee Chair, Meg Hillier MP, said: “HMRC’s transformation programme would have been less risky had it not attempted to do everything at the same time. What was already a precarious high-wire act is now being battered by the winds of Brexit, with potentially catastrophic consequences.

“HMRC accepts something has to give and it now faces difficult decisions on how best to use its limited resources—decisions that must give full consideration to the needs of all taxpayers.

“In particular we are concerned about the effect on people simply trying to pay their fair share. HMRC’s customer service has improved on the appalling levels of recent years but its claims about call-answering times don’t stack up. Any new deterioration would be wholly unacceptable.

“There are concerns too about the impact of changes in the welfare system, which could increase the financial risks faced by vulnerable Tax Credits claimants. At the same time, the level of Tax Credits fraud and error has gone up and is only going to get worse.

These are serious, pressing challenges for HMRC, requiring swift and coordinated action in Government. As a matter of urgency the authority must set out a coherent plan and demonstrate it is fit for the future.”

This week, the BBC ran an article outlining how nursery and pre-school organisations say thousands of parents have experienced major problems paying for childcare using an HMRC-run website.

Dave Anderson, digital performance expert, Dynatrace, said: “Today’s reports of ongoing technical problems with the Childcare Choices website indicate that there’s more to do before the early ‘teething troubles’ are ironed out. What’s interesting is that the website appears to be so temperamental. Whilst it sounds like it’s working fine for some, others are having a very different experience. The only way the government can get a handle on these problems is with a more focused approach to monitoring the performance of the website and managing the user-experience.

“Basic visibility over whether the service is ‘up and running’ won’t provide the level of detail needed to understand what’s causing some parents to encounter problems whilst others enjoy a seamless experience. There are simply too many variables involved in modern IT services for a human to manually identify where performance problems are coming from. Is it the user device, their operating system, or a temporary fluctuation in the dynamic IT stack?

“Answering that question is pure guesswork without Artificial Intelligence to monitor and analyse the experience of every website visitor in real-time, and automatically pinpoint the root cause of any user frustrations as they arise. That type of visibility would be invaluable in finally getting to the bottom of what’s causing these problems and making sure the service is working as it should be, for everyone.”

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