Tag Archives: Tax Credits

Tax Free Childcare

 Consultation arrangements over Tax Free Childcare in HMRC

Tax Free Childcare (TFC) was announced by the government as part of the 2013 budget. It is scheduled to launch in autumn 2015, and the broad aims of the scheme are:

–          A government contribution towards childcare which could be worth up to £2,000 per child each year.

–          All working families with children under 12 will be able to access the scheme within the first year of its opening.

–          To be eligible, both parents (or a lone parent) must be in paid work up to a maximum earnings threshold and not be in receipt of tax credits, Universal Credit or Employer Supported Childcare

–          Tax-Free Childcare will be delivered by HM Revenue & Customs (HMRC) in partnership with National Savings & Investments (NS&I) which is an Executive Agency of HM Treasury. The scheme will be simple, flexible and straightforward for parents and childcare providers; parents’ money will be secure; and they will face no fees or charges.

–          Self-employed parents and those working for employers who do not offer the existing Employer-Supported Childcare scheme will be able to access the scheme

–          Parents who are currently using the Employer-Supported Childcare scheme will be able to choose to stay in that scheme or move to Tax-Free Childcare. It will be their choice. However, Employer-Supported Childcare will be closed to new entrants once TFC goes live. Employers’ workplace nurseries will not be affected.

PCS have been offered stakeholder involvement in the project and we met recently with the Programme Director to get an early view of the work being undertaken. That meeting was very useful as a starting point but it is clear the project is still very much in development and that a lot of planning work needs to be done before we can begin talks on what TFC will mean in terms of jobs and where the work will be located.

We have agreed the need for further meetings with the Programme Director in the coming months as these plans start to firm up, and we will keep branches updated with progress.

Tim Coxon
On behalf of AGS Helen Watkins

R&C/BB/110/14

 

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Universal Credit Update

Management announce new timetable for Universal Credit roll-out

Under the government’s original places for Universal Credit new claims for JSA across the country should by now have become new claims for Universal Credit (UC). We should also have been expecting new claims for tax credits to become new claims to UC from April 2014. However, as we know the development of UC has been beset with serious problems that have resulted in that original timetable being ripped up.

New timetable for UC
A new timetable for UC has now been unveiled:

  • Bringing 6 additional Pathfinder offices onto UC by April 2014, to make 10 in total continuing to use the original, flawed UC IT system
  • Summer 2014 start to take claims from couples in the 10 Pathfinder areas
  • Autumn 2014 start to take claims from families in the 10 Pathfinder areas
  • Once this has been tested in the 10 Pathfinder areas extending new claims to cover more of the North West geographical area.
  • During 2016 UC to be fully available in each part of Great Britain, having closed down new claims to legacy benefits.
  • The majority of the caseload of legacy benefits to be moved onto UC during 2016/2017.
  • Final decisions on this timetable will be informed by the development of the enhanced digital IT solution

The enhanced digital solution

The original UC IT system is operating in the Pathfinder offices but it is accepted that this IT system is not robust enough for national rollout. This problem has been a major factor in the delay to the UC timetable and accounts for the reports that as much as £200 million may have to be written off for this failed IT system.

Management accept that the original UC IT system will never become the secure online digital system that Ministers want; one that would enable claimants to process their UC claims and changes of circumstances online.  Instead, during the second half of 2013, an enhanced digital IT solution designed to deliver this kind of online service for UC has been tested.

Original estimates were that this new system may be ready for late 2014. Management, however, have had to concede that this new digital online IT system cannot be delivered until the end of 2015. But, given the history of failure of large-scale IT projects in the civil service, many members will be sceptical that this one will be any different.

Faced with a situation where the bulk of UC implementation has had to be deferred for two years, a decision has been taken to continue to very slowly increase the size and scope of the UC Pathfinder, as per the timetable above, while the new IT system is developed. As this timetable makes clear, however, large-scale implementation of UC will not now happen before the end of 2015 at the earliest.

The enhanced digital solution is designed to automate a considerable amount of processing and telephony work. It remains to be seen how successfully this can be done, and the recent IT difficulties that UC has had do not give much cause for confidence.

Threat to Jobs?

If, however, such a digital IT solution were to be introduced effectively, it is clear that there would be a dramatic impact on jobs. Many processing and telephony roles would be automated. While it would not be possible to fully automate the process, a significant impact is still likely. At this stage it is too early to judge what this new UC IT system will deliver and the GEC will work closely with DWP colleagues to closely monitor its development.

Ministerial authority is currently being sought to recruit external IT experts to help build the new IT system for UC – following the earlier than expected withdrawal of support from the Cabinet Office’s Government Digital Services team who had been assisting in this work.

What happens now?

Apart from the small scale, gradual increase of UC in the Pathfinder areas, management are effectively starting again in drawing up new implementation plans for UC. They are working on a new assumption that large scale introduction of UC will not start before the end of 2015. This means that the bulk of legacy benefits will remain in force in the interim.

This major re-working of the implementation plans also calls into question whether the sites that were named as future UC sites in May 2012, (in both DWP and HMRC), are still destined to be UC sites. Management say that they have not changed their working assumptions in this regard but it is clear that these old assumptions could be changed given that new implementation plans are now being drawn up.

Pathfinders

The number of claims to UC that have been taken in the Pathfinder areas remains very low. Between April and 31 October 2013 only 2,900 new claims to UC had been received. This is a tiny amount when compared to the c.60,000 new JSA claims that DWP receives every week. Moreover claims to the Pathfinders are still restricted to single people with no dependants. These figures show how far UC has to go before it is any position to replace the existing benefits and tax credit systems.

Conclusion

It is clear that it will be some considerable time before we will be in a position to map out clearly what UC will mean for members in both DWP and HMRC. The GEC will continue to engage with UC management and our PCS colleagues in DWP to ensure branches and members are kept as up to date as possible.

Tim Coxon – Assistant Group Secretary
Tom TaylorIndustrial Officer

R&C/BB/68/14

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PCS Secures Major Parliamentary Debate On Enquiry Centres

A Westminster Hall debate took place on Tuesday as a result of PCS intervention

“The taxpayers most likely to be prevented from accessing the proposed new service as a result of the cost are the unemployed, those on low incomes such as migrant workers and pensioners, and child benefit and child tax credit claimants. Such taxpayers rely heavily on the free service currently provided by HMRC staff at enquiry centres.”Ian Lavery MP, 4th March 2014

Ian Lavery MP, a member of the PCS cross-party parliamentary group of MPs, secured a Westminster Hall debate on March 4th over the HMRC decision to announce the closure of all 281 tax enquiry centres on February 8th. MPs contributing to the debate, including John McDonnell, Jonathan Ashworth, Graeme Morrice and Mark Williams, made clear their opposition to the closures.

MPs also raised concerns about the possibility of 1,300 staff having their jobs threatened and the lack of support they have been given by their employer since the decision was made to close their offices last month. Members were only given two weeks to decide whether to accept an exit package, apply for an as yet undefined prospect of redeployment or one of the limited numbers of jobs in the new service, with HMRC reneging over previous commitments to holding 1-2-1 interviews to establish personal circumstances.

MPs are sceptical over the move to a service where people would be vetted over the telephone over whether they required a face-to-face appointment. Our parliamentary group chair John McDonnell MP warned that it would put even more pressure on call centres when: “HMRC is significantly failing its existing call centre targets already.”

On the morning of the debate GEC members met with Treasury minister David Gauke to raise our concerns about the closures. This meeting only came about after PCS made strong representations to ExCom following a previous answer to a question raised at PMQs in the Commons which suggested Ministers and senior HMRC officials were regularly meeting PCS regarding the pilot when, in fact, no meetings had taken place. The meeting lasted approximately 30 minutes and is the first such meeting PCS have been granted with the minister since he assumed office.

Despite the concerns raised by us and by MPs, the minister has responded that he believes the new services will allow better support to customers. We remain unconvinced and believe it is demonstrably better for staff and the public for the enquiry centres to remain open.

You can read the full text of the debate here

http://www.publications.parliament.uk/pa/cm201314/cmhansrd/cm140304/halltext/140304h0002.htm#14030469000001

And you can help by taking 2 minutes to complete our e-action here (please complete on your personal device and not from official computers)

http://action.pcs.org.uk/page/speakout/stop-the-closure-of-hmrc-enquiry-centres

Our campaign to defend the enquiry centres is part of our Jobs and Staffing campaign that demands:

  • An agreement on staffing to ensure that there are enough staff to do the work.
  • Permanent jobs for all FTA staff.
  • A guarantee of no compulsory redundancies and no compulsory moves beyond reasonable daily travel.
  • An end to office closures, and for HMRC to retain a visible face to face presence in our communities.
  • An agreement on workload – reducing stress, over-stretch and demands on workers.
  • An immediate scrapping of the discredited performance management system.
  • A reduction in line managers’ spans of command, to reduce pressure and to allow managers to focus more on staff support and development.
  • A fully funded HMRC tackling avoidance and evasion – but also putting public service delivery at the heart of everything it does.
  • No further privatisation of HMRC work or functions.

Organising to Win

 Whilst our ultimate aim remains to achieve agreement with HMRC through negotiation, we will, as always, need to also begin preparations immediately in case we cannot secure the commitments that we are seeking through negotiation alone. The GEC has prepared a comprehensive plan of activity to build for a ballot of all members across HMRC in the event that negotiations fail to deliver an agreement which we feel able to recommend to members.

If you support our alternative vision for HMRC and our campaign demands we urge you to contact your branch representatives to find out how they are supporting the campaign and how you can help.

John Davidson – Assistant Group Secretary
Vicki Searle – Assistant Group Secretary

R&C/BB/66/14

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