HMRC’S sweeping reorganisation could hit performance, warns union

The tax authority plans to centralise 170 offices across the UK into 13 large regional centres in a bit to cut costs and improve services.

Unions have raised fears that HMRC’s decision to relocate up to 38,000 staff over long distances as part of a sweeping reorganisation will harm its ability to do the job of collecting tax.

The changes are part of long-term plans by the tax authority to centralise 170 offices across the UK into 13 large regional centres. The aim is to save taxpayers £83 million per year and provide a better service.

But according to a report by the National Audit Office (NAO), while HMRC employees will find their place of work is on average 18 miles further away, staff from an office in Redruth, Cornwall, will have to relocate by up to 174 miles to Bristol if they wish to keep their jobs. Workers from Aberdeen and Dundee will be relocated to Edinburgh, which is 127 miles away, while a new office in Croydon, south London, will require employees from Norwich to move around 130 miles.

The tax authority has said it expects about 5,000 staff to leave the organisation as a result of the disruption. But the NAO warned that the changes would “inevitably increase uncertainty among some of its employees, and have the potential to harm its relationship with them”. It could also affect the ability of workers to do their jobs properly, at least initially.

“Staff that will be recruited at the new regional centres may have lower initial performance, and may take time to reach productivity levels of more experienced staff,” the report pointed out.

But the Public and Commercial Services (PCS) trade union, which represents affected workers, said that it was already concerned that the cuts could harm HMRC’s tax collection abilities.

Mark Serwotka, the PCS’s general secretary, added: “With costs rising, and the cracks beginning to show, it is now imperative that HMRC halts these plans and allows MPs and the public to have their say.”

Although the NAO report indicated that HMRC had already recognised that its original plans were unrealistic and was evaluating whether to change them, no new proposals have so far been forthcoming. This is despite the fact that the cost involved in providing new buildings for the scheme has escalated by £600 million since it was first put forward in 2015.