Complaints and appeals
Jump to
6.1. As problems within the tax credits system grew and customers became increasingly frustrated at the delays in resolving them, they turned to the mechanisms for complaints and appeals in an effort to get their cases sorted out. As a result, the volume of complaints and appeals has expanded and considerable backlogs have accumulated - causing delay and further distress.
6.2. There had been 73,000 appeals concerning tax credits lodged by February 2005, of which only 2,900 had proceeded to a tribunal.[39] As discussed in Chapter 5, some customers were wrongly advised by Revenue staff to appeal in circumstances when no appeal was possible, which led to unnecessary delays in tackling the underlying issues. It may well therefore be the case that the low proportion of cases heard reflects at least in part the fact that many of these appeals were inappropriate, made in an effort to resolve issues, such as recovery of an overpayment, against which no appeal lies. No information is available on the number of appeals which have been settled by agreement, and those still waiting either to be settled or referred to the independent Appeals Service.
6.3. In 2003-04 there were 32,000 written complaints about tax credits.[40] In 2004-05 the Revenue had received 48,500 complaints up until the end of February 2005. At that date, there were 4,400 complaints awaiting resolution.[41] The scale of the task faced by the Revenue can be seen in the increasing numbers of staff brought in to deal with complaints. Staff numbers dealing with the main body of tax credit complaints have nearly doubled in size in the last year, rising from around 200 staff to nearly 400 at 1 April 2005.[42]
6.4. Despite the extra staff, there have been considerable delays for customers in getting a response to their complaints. Some tax credit customers, desperate to get their case looked at as a matter of urgency, were frustrated to receive a standard acknowledgement letter in response to their complaint, advising them to expect to wait between 6 and 8 weeks for a substantive reply. Against a target of dealing with 80% of complaints within 15 working days, in the 11 months to the end of February 2005, only around 56% of complaints had been dealt with during this time.[43]
6.5. The Revenue literature on tax credits complaints gives customers a telephone number to contact about a complaint. In fact, cases investigated by the Ombudsman have indicated that it has proved virtually impossible to speak to someone on the number given. The Revenue answers an average of 100 calls a day on the line - a woefully small number, given the volume of complaints (see paragraph 6.3). The Revenue has confirmed that caller demand on the customer complaints line is currently exceeding its capacity to answer calls.[44] The inability to speak to tax credits staff about a complaint or appeal has added to customers’ sense of a system which does not communicate with them.
6.6. In many cases, customers have turned to the complaints process because they have been unable to resolve the substantive (and often complex) issues concerning their tax credit award in any other way. But one of the frustrations for some customers has been that, rather than the Revenue always taking the opportunity to examine those issues, the complaint has been dealt with by way of an apology and payment of compensation - whilst the real problem or problems remain outstanding.
In the case of Mrs C (paragraph 6.5), two written complaints to the Revenue about her case in June and August led to the Revenue’s complaints team sending her two payments of compensation, in July and August. However, the subject of her June 2004 complaint - that she was being financially penalised for Revenue mistakes she reasonably did not spot - was not actually dealt with until January 2005, when eventually the whole sum was written off.
6.7. Not only is this unsatisfactory from the customer’s point of view, it is also an inefficient way of working. It points to the fact that the Revenue has been failing to deal with cases in a co-ordinated way; it would seem that priority has been given, once a complaint has been made, to clearing the complaint, rather than getting a case properly sorted out once and for all.
6.8. In total well over £1 million has been paid out by the Revenue in compensation for delay, hardship, inconvenience and distress. In 2003-03 10,820 tax credits customers received compensation amounting to £309,000. 45 In the nine months up until December 2004, 14,400 customers had been paid compensation, amounting to £912,000 in total.[46]
6.9. As a result of the delays in complaints being dealt with, and the failure of the complaints system often to tackle the substantive issues behind the complaints, some tax credits customers chose to escalate the matter to higher up the system - turning to their MP in many instances to intervene on their behalf. Letters from MPs to the TCO rose from 223 in April 2004, to 788 by December 2004.[47] During the same period, calls to the MP’s hotline set up by the TCO to deal with constituents’ tax credit claims, rose from 930 in April 2004 to 1,675 in December 2004.[48] Referrals from MPs to the Ombudsman’s Office also rose substantially, from 37 in 2003-04 to 284 in 2004-05. In the Revenue’s Director’s Complaints Team - dealing with complaints sent via MPs and Ministers, the Adjudicator and the Ombudsman - staff numbers have risen nearly three-fold from 20 to 60 during the last year.[49]
6.10. The cases I have dealt with suggest that, in some instances, it is only at this stage that a case is finally fully investigated and all the different elements pulled together and looked at as a whole.
6.11. A customer should not have to make a complaint, then complain further to an MP, to the Adjudicator, and to the Ombudsman, before the Revenue will conduct a proper investigation into the history of a claim and what has gone wrong.
6.12. Since early 2005, the Revenue has begun to address this issue. As discussed in Chapter 4, the TCO has now established a new, dedicated team based in Liverpool, charged with the task of dealing with complex cases. The intention is to intervene, sooner rather than later, to resolve problems which arise. This is a welcome development, which it is to be hoped will reduce the number of cases where customers feel a complaint or appeal is their only route to get a problem with their tax credit award resolved. This is an area I intend to keep under review.
Footnotes
39 See Revenue letter to the Parliamentary Ombudsman, 21/4/05, Appendix C
40 Hansard, 25/1/2005, col 218W
41 See Revenue letter to the Parliamentary Ombudsman, 21/4/05, Appendix C
42 Ibid
43 Ibid
44 Ibid
45 Hansard, 18/11/2004, col 1711-1712, and 18/1/2005, col 830W
46 Hansard, 18/2/2005, col 830W and 31/1/2005, col 599W
47 Hansard, 21/2/2005, col 75-76W
48 Ibid
49 See Revenue letter to the Parliamentary Ombudsman, 21/4/05, Appendix C
