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Home > Publications > Reports - Parliamentary > Tax credits > Foreword
Foreword
I am laying before Parliament under section 10(4) of the
Parliamentary Commissioner Act 1967 this special report on the
administration of Child and Working Tax Credits, which were
introduced by the then Inland Revenue (now HM Revenue and
Customs) in April 2003. The new tax credits system is aimed at
helping to tackle child poverty and encouraging more people into
work. It is a major project which affects around six million families,
and uses a processing system which is wholly IT based. This report
does not suggest that the new tax credits system is in general
disarray; on the contrary it recognises that, given the scale of the
undertaking, its introduction has been broadly successful.
However, the new system created fresh challenges for the
Revenue. Amongst those six million families, it brought them a
new group of customers, the key groups intended to benefit from
the tax credit reforms: poor families with children and low income
earners. These are people who rely on the payments made by the
Revenue as an essential part of their family income.
By drawing on the experiences in the complaints referred to me
since the introduction of the new system, this report charts the
experience for that particular group of tax credit customers. It
seeks to understand what has gone wrong in those cases, the
impact on customers, the effectiveness of the Revenue’s response
and the lessons to be learned. However it also raises wider and
more fundamental issues, which are not for me, but for
Government and Parliament to address, such as whether a financial
support system which includes a degree of inbuilt financial
uncertainty can meet the needs of this particular group of families.
It also suggests that, if such a system is to meet those needs, then
a much improved level of customer service is required in the form
of better and clearer communications, easier and quicker customer
access to Revenue staff who can address problems and queries,
and prompt and efficient complaint handling. Without these a
sizeable group of families will continue to suffer not just
considerable inconvenience, but also significant worry, distress and
hardship. It is particularly important that these key issues are
addressed before the Revenue transfer over into the system, later
this year, the 800,000 families who currently receive their Child Tax
Credit through Jobcentre Plus.
In addition, I believe that this review suggests that there are
important lessons to be learned, not just for HM Revenue and
Customs, but for all public bodies when implementing new policies
and systems. In particular, it highlights the importance, when designing new systems, of starting from the customer perspective and maintaining customer focus
throughout the development of the programme. It also highlights the dangers of introducing a ‘one
size fits all’ system. Such systems, whilst superficially providing a fair and consistent and efficient
service for all customers can, by failing to pay sufficient regard to the different circumstances and
needs of specific client groups, have entirely unintended harsh and unfair consequences for more
vulnerable groups.
I know that HM Revenue and Customs are committed to providing good customer service, to
understanding the customer experience and to the importance of using complaints as an important
source of feedback and learning. I hope, therefore, that they will welcome this report as valuable
feedback to help them improve the service they provide to all their customers.
Ann Abraham
Parliamentary and Health Service Ombudsman
June 2005
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