Error causes IR cutbacks

21 Feb 02
The Inland Revenue has been forced to take cost-cutting measures because of a mistake by officials in the department's spending submission to the Treasury, according to Whitehall sources.

22 February 2002

Officials say the 'simple clerical error' has left the Revenue with a black hole of around £40m in its budget.

'The Treasury was made aware of the error, but they told us to get lost,' said one senior manager.

Another official said that IT upgrades and office refurbishments had been postponed. 'There is a lot of cheese-paring going on,' he added.

Officials also cast doubt on official claims that the Revenue was likely to net £80m in fines from people who failed to file their tax returns before the February 1 deadline.

A statement from the Revenue last week claimed that 800,000 people had missed the deadline, but officials believe that many of those are not eligible for self-assessment or have low incomes that will exempt them from paying tax.

'Some may even be dead,' said one official.

PFfeb2002

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