Frank Field, the chair of parliament’s welfare committee, has said that a company’s “reign of terror” over British tax credit recipients will be drawing to a close after HMRC decided not to renew its contract.
US company Concentrix was accused of making a string of mistakes including stopping a teenage single mum from receiving tax credits after wrongly claiming she was married to a dead pensioner.
Field had called on the government to investigate and act on concerns about Concentrix’s handling of tax credit claims.
Following HMRC’s decision not to sign a new contract with the company, Field said: “Concentrix’s reign of terror is drawing to a close. Again the government has acted decisively in protecting vulnerable Britain. This holds out huge prospects and, for some exploiters, horror, in the near future.”
The company won a multimillion pound payment by results contract to prevent incorrect or fraudulent claims in a bid to save government money, earning more money the more claims it stopped.
But the Treasury said there had been 120 cases since October that did not fully comply with the contract requirements, with a Facebook campaign group suggesting many more might have been affected.
Some cases involved people being unfairly prevented from receiving tax credits but there were also questions over the general levels of service including over factors such as call waiting times.
HMRC’s chief executive, Jon Thompson, said: “We want to reassure customers who have had their tax credits stopped that we will prioritise their cases, and make sure that they are processed as quickly as possible.
“While it’s right that we ensure that tax credits customers only receive the money to which they’re entitled, it is vital that those customers have a high level of service.
“That’s why we have decided not to extend our contract with Concentrix and HMRC is redeploying 150 staff so that customers can get through to advisers and resolve any issues about their claim.”
A Concentrix spokesperson said in a statement: “We have operated professionally at all times and within the guidance set by HMRC. The HMRC statement not to renew the contract attacks our professional credibility, and the commitment of our staff who have performed determinedly, despite the issues with HMRC policies and procedures.
“In addition, throughout the contract, Concentrix has employed good hard-working people within the UK, at Concentrix expense, in order to staff phone lines and handle customer calls which were agreed by HMRC and were based on HMRC assumptions.
“To be clear, we have answered significantly more calls than planned with HMRC. Throughout the contract we have not been incentivised to make wrong decisions for claimants and, in fact, would be penalised heavily for failure to adhere to HMRC policies and procedures. Through the term of the contract we are pleased to have saved the taxpayer nearly £300m in authentic confirmed tax fraud and error which otherwise would have cost the taxpayer money.”
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