HMRC Is Shite

HMRC Is Shite
Dedicated to the taxpayers of Britain, and the employees of Her Majesty's Revenue and Customs (HMRC), who have to endure the monumental shambles that is HMRC.

Friday, 10 February 2012

HMRC Disputes Redknapp Costs



HMRC have described as "nonsense" reports that it has spent £8M on the Harry Redknapp case.

HMRC claims that the costs of the five year investigations into Mr Redknapp, Milan Mandaric and Peter Storrie cost less than £300K, while Crown Prosecution Service costs were almost £1M.

Does this ring true?

Not really, as the BBC notes the cost of the trial to the public purse will have been far higher than just the cost of HMRC's investigation because of the costs of bringing the cases to court.

I would also note that an investigation of this length and complexity would have involved quite a few HMRC man hours. Although HMRC do not "charge" per hour, there is of course the internal opportunity cost of working on a specific case.

Let us assume that only one person (a senior manager) in HMRC ever worked on this case (a ridiculous assumption), and that his/her time was valued (in terms of internal opportunity cost) at £300 per hour (professional firms charge out rates are far higher than this for senior managers).

Using HMRC's £300K figure this would equate to 1,000 hours (before expenses), or (assuming an 8 hour day) 125 days.

It seems a tad "light" on the hours for a five year high profile investigation to me.

However, maybe they really only did spend 1,000 man hours on this?

Tax does have to be taxing.

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4 comments:

  1. HMRC would say that wouldn't they.

    In HMRC's little world only two rules apply;

    Rule 1; HMRC are always right and can do no wrong.

    Rule2: When HMRC are wrong, refer to rule one.


    I would have thought that a top legal team with one QC, one junior and a solicitor for two weeks alone would have cost best part of 300k but, then again, I do live in the real world.

    It must also be noted that HMRC, the police, the CPS and the courts are all funded by the public purse so it seems silly to suggest that £1.3m has covered all those costs however, if that figure is the true cost, it may explain why the case ended as it did because, one thing I've learned in life is that you only get what you've paid for.

    Did Harry get costs awarded to him as is the normal practice? His legal team weren't cheap were they?

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  2. This was seen earlier:

    "Spurs have just announced that the reserve team will recommence training now they have finished jury service"

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  3. Really Ken, a senior manager working on a case? That is to difficult to imagine.

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  4. If the case was so ill conceived, why did the CPS agree to bring it? Bloody hell Ken, get a life.

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