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, 14 December 2012

The Road To Privatisation?

I am aware that many loyal readers have regularly posted comments on this site expressing their views that the government intends to privatise HMRC.

Up until now I have been of the view that privatisation was unlikely:

1 The issue of confidentiality of taxpayer's tax affairs would be very difficult to entrust to a third party (although, as loyal readers will point out, to some extent their parties do have some access to this eg the datagate fiasco was blame on a third party).

2 The political cost of privatising HMRC would be too high, ie there is insufficient support for such a move.

However, based on a recent announcement about a pilot for the outsourcing of text credits debt, it may be that I am wrong and that there is a "plan" (albeit a very "woolly" one) for step by step outsourcing.

The Low Incomes Tax Reform Group (LITRG) issued a press release last week noting that people with tax credit overpayments may in future be dealing with third party debt collectors:
"The Government announced yesterday that they are to conduct a payment-by-results pilot on outsourcing the collection of tax credits debt. This could mean that people with overpayments of tax credits will be dealing not with HMRC directly, but with debt collectors who will be paid by results, and who may therefore be tempted to be less than scrupulous in the methods they use.

Robin Williamson, Technical Director of the Low Incomes Tax Reform Group, commented:
“Tax credits overpayments are not due to claimant error and fraud alone. They arise also from official error, and a certain amount of claimant error is generated by wrong information from government sources.

“Also, because tax credits are a system in which payment is made on a provisional basis while entitlement is decided at the end of the year and adjustments then made, overpayments and underpayments often arise naturally as an integral part of the system. They are an inevitable feature of the design of tax credits. We must seriously question whether dealing with tax credit overpayments just like any other debt, by outsourcing recovery to commercial debt collectors, is an appropriate or proportionate response to the problem.

“If HMRC persist in this course of action, they must take great care to impose the same standards and safeguards as they would themselves when recovering these highly sensitive and untypical debts. The debt recovery arm of HMRC has published specific guidance on tax credits debt which has been developed over the last couple of years. It ensures that people’s circumstances are taken into account in order to set realistic time-to-pay arrangements and that those without the means to pay are able to have their debts suspended or written off in accordance with their needs.”

Notes to editors
  1. The Low Incomes Tax Reform Group (LITRG) is an initiative of the Chartered Institute of Taxation (CIOT) to give a voice to the unrepresented. Since 1998 LITRG has been working to improve the policy and processes of the tax, tax credits and associated welfare systems for the benefit of those on low incomes."
Views and comments are always welcome, do you think that the government wants to privatise HMRC, if so will it be privatised?

Tax does have to be taxing.

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  1. It is about time that The Muppet Show had a new script instead of posting reruns.
    It has been tried before, it does not work.
    WTF have this lot been paid salaries for let alone bonuses? I think it has been referred to as collecting and protecting the revenue, pretty basic stuff eh? If its not for performance what is it for, turning up, first in the queue for the whiteboard?
    Then there are the systems, they don't work properly between Muppets, add a third party to the cast list, well, you already know the outcome folks.
    And don't forget the customers, these are some of the most at risk anywhere, want to bet on whether they become victims?
    Cue closing music and titles.


    TAX R US

    pay us da money llp

    IR 4 U

    dah money is hours ltd

  3. @ Anonymous 16.23, whats this about a bonus ! - I have only ever had ONE , back in 1995 for £150.00 gross !.

    As for the use of DCA`s, they are already being used to collect SA & VAT debts.
    As they are paid on results, if you thought HMRC were bad, the DCA`s are ruthless !.

    1. My fault, I was referring to the obscene amounts those up the slippery pole seem to earn as "bonuses" and should have made that clear.

      Yes, DCA's have been used for decades, they used to be called baillifs undertaking the "baillif run" usually with an EO as was in tow to execute the warrant in those days. Even in those days the system got things wrong otherwise the EO would not have been writing TCP on the file, Trader Contends Payment, usually backed up by a cheque stub or dare I say it an official, stamped receipt, but then there were local office cashiers taking the "custmers" remittance in those days! (suggestion - reopen local cashier facilities).
      Payment on results, well everything would be OK if the attempt to collect the debt were legal and based on accurate and up to date data. as we all know, HMRC data is about as up to date as last years Christmas wish list! DCA's or whatever they are called this week, don't give a flying fig about ethics, accuracy let alone law as has been previously discussed on this forum. Any attempt to collect an amount of money which is not legally due should be taken to the small claims court and met with claims for compensation and damages.
      Unless the "sheeple" do this the system will continue to take advantage of them.
      I do not condone the non-payment of tax, but neither do I condone illegal and bullying tactics by the establishment.
      The "sheeple" deserve better.

  4. They have been hiving bits off the Revenue for more than 13 years now. It started with the creating of PAYE schemes for new employers being set up by NESI (New Enterprise Support Initiative) I was once told by a manager at IR that the NESI employees were on piece work, but have been unable to verify this.

    Some of the most nefarious debt collection agencies around have been used in other areas of HMRC for at least 3 years now.

    There have also been pilots ongoing for private companies answering the phones for the call centres.

    The PCS union believe that the recent government proposals to do away with most of terms and conditions, including a lot of part time working and flexi time working is in preparation for private enterprise to take over, so Ken I would say unfortunately that the answer is definitely yes.

  5. Wonder if the split will be handled by non-interested parties?

    Of course it is fairly easy to predict the "break-up" of Broone's demented orc-ridden enclave:-
    Hi-net worth earners
    Global players
    Debt Management
    Call Centres
    Corp. Tax <£1m
    Corp. Tax >£1m
    Anything dirty like Customs/Excise duties
    VAT offshore
    VAT UK
    Stamp Duty - abolished?

    Better not go any further, think of the cost of all those redundancy packages!
    Don't forget, every replacement organisation will require a new set of managers and workers, you don't imagine for one moment the current encumbents will be TUPED across do you?! LOL
    All this to be paid for by the "customers" and with reduced pensions all round, pensions managed by the trustworthy private sector of course, you wouldn't want the banks looking after your pension now would you?
    Yep, happening soon to a public sector near you..................

    1. Wrong, wrong, wrong, HMRC is an Institution, at least given the number of embedded lunatics on the payroll that is.
      It exists to ensure that people and business pay their legitimate dues and to serve the public interest in the process.
      Without this great Department how would we have the money to pay for all the excellent PFI money generators that now exist in the piblic sector. Think of all the taxes due as a result of their operating in fields such as IT, Job Creation, Tax Collection, Health, Welfare, Policing, Security, Education etc. etc.
      What do you mean they all have one thing in common, they buy their coffee in Switzerland, so what?
      On second thoughts I think I will go off the grid and live with my chickens and goats.
      Tis the season to be jolly, hah, bumhug!

    2. Interesting.
      I remember when I joined the Civil Service many older staff receiving their salaries by payable order and then going to the cashier at the main office to exchange it for cash, this was also done for those in receipt of expenses.
      The reason?
      Yhese people did not and would not have a bank account, it was simply ingrained in them never to trust the banks.
      My how things come full circle, what with banks being fined for money laundering and Libor scandals let alone being bailed out from hard earned taxes and then refusing to make the money available to those most needing it.
      Then there are the politicians, a lot of whom are hypocritical, lying, thieving opportunists.
      Then there is HMRC!
      Corrupt as seen since the Mapeley deal was unearthed involving the 2 predecessor departments, inefficient and bungling whilst managed by the most useless bunch of self serving people you are likely to encounter in public life, deficient in morals and cynical in their collective law breaking.
      I rest my case.
      Complete the privatisation of the whole lot and be done with it, stop messing about and wasting money.
      While you are at it, don't believe the hype put out about paying benefits to jail inmates being as being imposssible to manage - who has got all the inmates details on file along with how much they are receiving whilst in whichever prison they reside?
      Yes, its all on their databases, somewhere.
      Don't blame the prisoners, if you make something attractive and easy to nick it will be stolen.

    3. Yep, we have all the prisoners details. They communicate by the power of thought alone,while we are all wearing tin foil hats.

      You Sir, are a loony.

  6. Not only is HMRC up for sale to the private sector but it is hoped that putting the sale in the European Gazette that a tender will come from abroad.
    These are desperate times as far as the Government are concerned they have paid off high ranking civil servants with extremely high retirement or redundancy packages. Then don't forget their own meagre pay rise and also not to forget the sell off to Mapeley who they later bailed out for non payment of taxes even though the offshore account is still lining peoples pockets.
    Sceptics say what you will about this post but in the near future we will be bleeding more money out to pay for Government mistakes.

  7. The Government wants to Privatise everything.