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KEY POINTS
- Ongoing delays in HMRC dealing with post.
- David Gauke MP at the ICAEW Hardman lecture.
- What is a reasonable time limit for dealing with administrative and technical post respectively?
- Proposals that will be put to the minister for comment.
HMRC ‘s delays in dealing with incoming post is not a new story. In fact, if anything, it is such an old story that it has not rated much of a mention in Taxation over the past year or so. That does not reflect the importance of it for practitioners; it is probably the most common complaint that I hear when talking to readers.
But even they speak with a sense of resignation about horrendous delays in getting replies to important letters, and with no real belief that it is going to get any better. Well, that just isn’t good enough.
The Exchequer Secretary, David Gauke MP, gave the ICAEW Tax Faculty’s annual Hardman lecture last week. The general consensus is that he has made a good start, talking as a ‘professional to professionals’ with the tax and accountancy representative bodies.
Here at Taxation we were particularly pleased that we have at least been given several months’ notice of when the next Budget speech would be, even if we do not yet have a permanently fixed date.
So during questions at the lecture I thanked him for that, but asked him to give just as clear a commitment on post. My question, in three parts, was:
- what is an acceptable time limit for HMRC to respond to, say, 90% to 95% of letters they receive;
- when did he expect them to achieve that; and
- how did he expect them to do so with yet further cuts in staffing?
I didn’t seriously expect an answer at the lecture; and to his credit Mr Gauke was open about not being prepared to answer the first two points, because he was not going to make such a policy on the spot.
His answer to the third point, however, only served to illustrate the difficulty of achieving change. He spoke about improving the design of forms so that they were completed correctly first time, and about improving computer systems, which would result in HMRC being able to do still more with fewer staff.
The 100% ceiling
It reminds me of the contestants on The Apprentice talking about the level of effort they would put in if they got the job. ‘I’d work 110% to show you how good I am’. ‘If I became the apprentice I’d put in 120%’. ‘Lord Sugar, I’d give you 150%’.
No, you wouldn’t. If you did absolutely the best that you could, you would put in 100%, because you can’t do any more than that. In practice, you are not going to achieve 100%. Give 90% to 95% on a consistent basis and you are doing pretty well.
Equally, there is a finite limit to the amount of extra productivity you can get out of staff, and simply saying that you are going to get more out of them doesn’t make it so.
There may still be some minor gains to be made by further computerisation, although the near-universal message of past projects is that they will initially create extra work as their teething problems are sorted out.
These gains, however, are highly unlikely to cope with the future cuts in costs which HMRC are required to make under the Comprehensive Spending Review. Even if they did, that does nothing to improve the already appalling delays in replying to letters.
Not good enough
In my question I referred to a letter we published recently in which a reader said he had been told by a call centre that the post for August was due to be dealt with in December. I understand that the call centres have lists for each HMRC office giving details of where they are up to in dealing with post, and presumably this information came from such a list.
So the first issue is, why are these not available online for agents to see? This would at least save them from chasing items when they know that the post has not yet been opened. We will be pursuing this initially with the press office and subsequently if necessary with a Freedom of Information Act request.
The title of this article comes from another practice which we understand has become widespread; the supply by HMRC of a ‘red dot’ for replies that need to be processed promptly. This is a sticky paper circle which the agent is told to affix to his or her reply, so that it can be easily identified.
In other words, the letters with a red dot on will be taken out of the general post and dealt with, the letters without a red dot will wait weeks or months until someone manages to get round to dealing with them. How on earth did we allow the system to fall into such a poor state?
Far be it from me to suggest that you mutilate your copy of Taxation, or that you try to put one over on HMRC, but I would point out that our front cover is, as it always has been, predominantly red.
Armed with a hole punch and a glue stick, it should be possible for our readers to ensure that virtually all of their letters to HMRC go in with a red dot on from now on.
I’m not saying that it would also ensure that they got replied to promptly, as sticking a red dot on a letter does not actually employ the member of HMRC staff who deals with it at the other end, but it would be a wonderful ‘I’m Spartacus’ moment.
It’s no way to run a tax system. The ICAEW, in their Budget 2010 representations, highlighted the problem of post among other communication delays, and said that ‘HMRC needs to work with stakeholders to develop service delivery indicators which are robust and transparent and then use these to help prioritise improvements to its service delivery’.
An item on their website asking for examples of postal delays has resulted in over 50 comments so far, detailing delays of many months, particularly in dealing with tax technical issues.
The ICAEW has consistently called for service standard targets measured by something more robust than HMRC’s preferred measure of a telephone survey of their ‘customers’ satisfaction with the contact they had had with the department.
Setting standards
So, while I fully understand that Mr Gauke was not going to respond to my comments on the spot, I see no reason why he should not be able to do so as part of a process, given some time to reflect and to agree a set of appropriate benchmarks.
I’d therefore like to resubmit my first question, with something of a variation: what are acceptable time limits for HMRC to satisfactorily respond to communications they receive from agents regarding administrative and technical issues respectively?
This highlights the two different types of communication which agents have with the department, and the need for both of them to be dealt with within a sensible time limit.
If a single limit is set for all post, the result will be that all complex issues will be put to one side and become the 5% to 10% or so that is not actioned on time: see our report from four years ago on Centre 1, Singular Centre.
Getting a coding notice changed or a UTR issued is a processing issue; it does not involve significant technical input, nor does it require a lot of thought and consideration on HMRC’s part. It is simply a matter of getting it done, and in a system which is working properly it should be done within a few days, and it should be done correctly first time. That is what I mean by ‘satisfactorily’.
On the other hand, dealing with a technical issue will require input from someone with technical training; it may require that person to carry out some research; it will certainly require a commitment of time, and it may require input from technical experts elsewhere in HMRC.
That requires a longer time limit, but it is not unreasonable to ask for a swifter response which ensures that the administrative task of getting the letter or note of phone call to the right person within HMRC has happened, and then apply a longer time limit for a full answer.
A starting point
So, finally, what should the time limits be? It is tempting to simply leave that for the minister’s response, since if the limits he gives are too long he will be admitting the department’s inability to cope with existing (let alone future) resources.
However, as a starting point, the old 5CI form used to count post that was over 14 days and over two months old. You were not meant to have much of the former, and none of the latter.
A good starting point for discussion would therefore be that:
- 95% of administrative letters (and phone calls) would be fully dealt with within 14 days;
- all technical enquiries would have been routed to the correct person handle them, and an acknowledgement with contact details for that individual sent within 14 days;
- of those technical enquiries, 95% would have received a substantive technical response within one month; and
- all of them would have received a substantive technical response within two months, even if that had needed input from a further technical specialist.
I will be writing to the minister setting out these suggestions and asking for him to either agree them or suggest new ones shortly.
At this point I am only asking him to agree what an appropriate standard of service from HMRC would be. The next step will be to ask when it is reasonable to expect HMRC to achieve it.
I will keep you informed.
See this announcement:
http://www.hmrc.gov.uk/news/changes-incoming-mail.htm