My Lords, Her Majesty’s Revenue and Customs has improved its call waiting times. Over the last six months, it has consistently answered calls in an average of six minutes—a significant improvement from earlier in 2015. It is introducing a number of service improvements, including digital tax accounts, webchat and moving to a seven-day-a-week service, as well as ensuring that online guidance meets customer needs.
My Lords, the National Audit Office reported in May that the original cut by one third in staff numbers dealing with personal taxpayers led to a 50% increase in costs to taxpayers, costing them four times as much as HMRC saved. While matters have now improved somewhat, there are still around 3 million cases of discrepancies in personal tax records requiring investigation. Do the Government recognise that it is self-defeating, with £120 billion of uncollected tax, to offer such a poor service to taxpayers and that the situation is being made worse by closing offices, substantially cutting staff and relying increasingly on digital services to which many people do not have access? If so, what do they propose to do about it?
The noble Lord is right to draw attention to the National Audit Office report, which drew attention to things that HMRC had already taken into account. It made five recommendations: one was already superseded because it had been attended to, one was recommended by HMRC itself and three were accepted and are in progress. HMRC has increased the number of its customer services staff. It has undertaken its biggest ever training programme. Call waiting times are coming down significantly and it has a two-minute target. Of course, raising revenue is what HMRC is about, and last year it raised a record amount of revenue, the largest ever in its history.
I am not aware of the precise details of how the telephone queuing system works. All I know is that, in May, the wait in the queue was down to three minutes and that it is getting better. We are aiming to reach two minutes, but I am not aware of the technical reasons why you cannot tell where you are in the queue.
My Lords, does the Minister recall the Answer that I was given to an identical Question a year ago, on 9 July 2015, when the noble Lord, Lord O’Neill of Gatley, told the House that several promising steps were going to be taken, including the deployment of £45 million and the recruitment of 3,000 further staff to help this situation at his department? Does today’s Answer really show progress over what we had last year, given that the two-minute promise is very far from being implemented?
That is a fair question. In April 2016, customers waited six minutes on average. Last year, it was 18 minutes. In May 2016, it was five minutes, compared with 19 minutes in May 2015. It has now gone down to two minutes 53 seconds, which is progress.
My Lords, the NAO report also identified that HMRC is planning swingeing cost reductions in this area in upcoming years, relying on a shift to digital and online to pick up almost all the questions and requests that it gets in this category. Given the failure to deliver projects like that on time and in a way that works for customers, what is plan B? Is it something other than taking all the back office staff from PAYE and knocking that operation into disarray, which is what happened last time?
The introduction of online services was one of the problems that caused the waiting times. That is now working well. We have the largest number of online self-assessment forms ever, at January this year, and the largest number of on-time assessments. Progress is being made. As far as the estate is concerned, the noble Baroness is absolutely right: HMRC intends to make savings in the order of £100 million per year by reducing the estate down to about 17 offices—I cannot quite remember how many there are now. That is well in progress and will provide a better opportunity for the staff, who will have more opportunities within one large area. Some of the offices before, it must be remembered, had only 10 staff in them.
My Lords, the Minister has done his best to put a gloss on an appalling situation. The National Audit Office made quite clear the deficiencies of the Inland Revenue over recent years. The Minister says that things are now improving. How is it, therefore, that in the most recent poll of 600 people who spoke to an adviser, 63% of them waited for more than half an hour? Have the Government set out to reduce the number of civil servants operating in this department, and are they doing it all to fulfil their dogma of the smaller state, transferring the costs from the Treasury to the individual citizen?
Is the noble Lord aware that many older people are having increasing difficulties in dealing with HMRC, notwithstanding what he has just reported? If more offices close, that means more difficulties for them in the future. Is he aware that a special service needs to be provided for such people, and that there is in fact a charity, Tax Help for Older People, with 600 to 700 people working in it, including ex-Revenue people and ex-accountants? I declare an interest as a patron. Given that more offices are to close and that more difficulties are looming for older people, is the Minister prepared to reveal the possibility of giving financial assistance to that charity?
My Lords, HMRC does realise that different people have different needs. The whole point of the online service is that those who are able and willing to use it can do so, which enables HMRC to deal with people in the more old-fashioned way—face-to face and on the telephone. It will be able to do that more easily, and the figures show that it is improving.