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Tax Credits

Volume 455: debated on Thursday 25 January 2007

9. Whether he plans to give tax credit claimants the right of appeal to an independent tribunal on overpayment issues. (111029)

Claimants can appeal to the independent tribunal if they think their entitlement was incorrect and they should have been paid more than they were awarded. HMRC’s handling of a disputed overpayment can be reviewed by the adjudicator or through the parliamentary ombudsman. HMRC is exploring with the adjudicator whether she can go further and provide a fast-track review of disputed overpayment cases. There are plans to run a pilot test, and arrangements for that are being discussed.

I thank my right hon. Friend for that reply. The tax credit system has brought huge benefits to my constituents and I support it strongly. However, does she agree that the right of appeal to an independent tribunal over the recoverability of overpaid tax credits would make the system much fairer and much more acceptable to our constituents? Does she also agree that the suggestion is supported by the recent European ruling on the adequacies of judicial review as the only recourse where the issues are simply matters of fact and the credibility of witnesses? The right of appeal would give our constituents a chance to put their case.

I have to tell my hon. Friend that tax credits fully satisfy article 6 of the European convention on human rights. The details of the specific case that she has raised are set out in my written statement of 24 January 2007. People can appeal to an independent tribunal if they disagree with HMRC’s decision on entitlement, and that has always been the case.

Is it not disgraceful that, nearly two years after the ombudsman’s report, that is one of her recommendations that has still not been implemented? Will the Paymaster General explain why she has not yet implemented that recommendation? When will she implement it and all the other recommendations that are needed to give confidence to the low-income families who are suffering because of overpayments in the tax credit system?

As I said earlier, the Department stays in very close contact with the parliamentary ombudsman. Indeed, in her press release of July 2006 she complimented the Department both on its close working with her and on the progress made on her recommendations. If the hon. Gentleman cares to look at that in the Library, he will see that the ombudsman has also commented on the cases that she will take in future.