News : Damning Report Says HMRC Cost-cutting Has Inflicted Misery on Thousands
London, UK, July 26, 2016 -- Members of the public have been left hanging on the phone for an average of 47 minutes when they try to get through to the taxman, a damning report reveals.
A committee of MPs said that cost-cutting measures by HMRC had inflicted misery on people trying to pay or query personal tax bills.
In one week in October 2015, the average time taken for HMRC to answer the telephone reached almost 35 minutes, the report found.
But callers to its helpline with questions on self assessment were left hanging on for an average of 47 minutes.
And throughout 2015-16 almost three in ten calls remained unanswered as customers gave up.
Overall, the public spent four million hours hanging on the phone in a single year.
The report said that for every £1 saved by bungling HMRC as it axed staff and tried to force customers online, the cost to the public in wasted time and phone bills was £4.
Alarmingly, the Public Accounts Committee warned that the quality of service provided by HMRC could ‘collapse’ still further over the next five years.
MPs tore into the ‘appalling’ behaviour of the taxman and said the chaos had been caused by pressure on HMRC to cut costs, which led to it aggressively trying to push people online.
This has involved encouraging people to file their self-assessment tax returns over the internet rather than sending them by post, and providing more advice on its website to discourage people from using its helpline.
At the same time, it shed 5,600 call centre staff and closed dozens of tax offices. But the move backfired as the demand from taxpayers wanting to speak to a call centre did not drop – meaning waiting times rose sharply.
The MPs said that, in 2014-15 and early 2015-16, customer service levels plummeted.
And they warn that – with HMRC planning to cut budgets on personal tax services by around a third more over the next five years – there could be a further ‘collapse’ in standards.
Taxpayers spent some four million hours waiting for HMRC to answer the phone in 2015-16 and also incurred direct call charges while on hold.
Such charges apply while on hold to HMRC’s 0300 helpline which, unlike the 0800/0808 numbers used for some other government services such as Jobseeker’s Allowance, is not free.
Shambolically, at the end of 2015, HMRC had to recruit 2,400 new staff to try to repair the damage.
During the period when the chaos happened, HMRC was led by Dame Lin Homer, who was given her honour despite widespread criticism of her performance. She recently left with a public sector pension pot worth more than £2million.
Public Accounts Committee chairman Meg Hillier said: ‘The prospect of HMRC making further cuts to spending on customer service will chill the blood of many taxpayers.
‘HMRC’s recent performance in this area has been appalling for long periods and left members of the public counting the cost in time and money.It is bad enough that people trying to pay their fair share of tax should have been kept waiting for so long.
'But holding for HMRC’s helpline has hit them in the pocket too – a serious concern for those on low incomes and a dismal message to send to small businesses, the self-employed and anyone else simply seeking advice.
‘HMRC has serious work to do before this committee is confident it can provide a consistent, efficient service that properly meets the needs of taxpayers and optimises tax revenue.
‘Efforts to meet Government spending targets must not come through ill-conceived measures that effectively penalise the people departments are intended to serve.’
The committee says that before HMRC makes more cuts to staffing it must have ‘a clear understanding of customer behaviour to estimate how demand will change’ and be confident it can maintain service standards.
The report is the latest in a string of blistering attacks on the performance of HMRC.
Only two months ago, the National Audit Office revealed that more than three million people may have been left paying the wrong amount of tax due to a computer meltdown at the department. The watchdog said that customer service levels had ‘collapsed’ following the sacking of thousands of call centre staff.
Last night an HMRC spokesman claimed the report was an ‘inaccurate, out of date reflection’ of its performance. ‘We acknowledge that service levels in the early part of last year were not acceptable and we apologised,’ said the spokesman.
‘But the Public Accounts Committee is well aware our phone lines have since fully recovered and we are now offering our best service levels in years.
‘Wait times are now on average less than five minutes and customers consistently rate the support they receive on the phones as excellent. New online services also mean people can self-serve 24/7 or contact us via webchat or Twitter.’
Posted by Veronica Silva Cusi, news correspondent
Today's Tip of the Day - Understand Why Customers Buy
More Editorial From H.M. Revenue & Customs (HMRC)
About H.M. Revenue & Customs (HMRC):
HM Revenue & Customs (HMRC) was formed on the 18 April 2005, following the merger of Inland Revenue and HM Customs and Excise Departments. HMRC ensures the correct tax is paid at the right time, whether this relates to payment of taxes received by the department or entitlement to benefits paid.
Published: Friday, July 29, 2016