There is no guarantee the HMRC won't go into another downward spiral says the public accounts committee in their annual report on HMRC


The summary of the report from the Committee said “Our examination of HM Revenue & Customs’ (HMRC’s) performance has identified a number of matters of concern, some of which we have raised before. HMRC is relying on new digital services to transform its business and reduce demand on its call centres.”

“Making a success of this is vital to safeguarding tax revenues and ensuring an acceptable level of customer service. It is therefore essential that HMRC avoids repeating the mistakes it made two years ago when it reduced the number of staff in its personal tax service prematurely, resulting in a disastrous decline in customer service.”

The report is clear that there is no real confidence that HMRC has a credible plan to reduce costs without effecting customer service and this can have an impact not just on taxpayers i.e. employees and pensioners but also employers not least because if HMRC aren’t responsive then employers have to pick up the pieces.

Historically new systems have had some significant teething problems some of which have taken a long time to overcome and eradicate and the Committee is seeking reassurances that there are contingency plans in place with the Treasury should be demand on the services be greater than expected.

Meg Hillier MP, Chair of the PAC said:

“The lack of a convincing fall-back plan to safeguard service as HMRC undergoes significant change remains a looming threat to its ability to collect tax from individuals simply trying to pay their fair share.
HMRC’s senior management cannot afford to be complacent about the catastrophic collapse in customer service in 2014–15 and the first half of 2015–16, nor about what is at stake should their projections about demand for call centres prove wrong.
Contingency planning should not be an optional extra. By the Spring we will expect to see evidence that HMRC has agreed measures with the Treasury to ensure it is not left playing ‘catch-up’ at taxpayers’ expense.
We welcome HMRC’s admission that it must improve the way it handles complaints, which it must do in tandem with keeping a grip on telephone answering times.”