05 March 2004
The Commons Treasury select committee is demanding that Treasury permanent secretary Gus O'Donnell explain a three-month delay in the publication of a report outlining the future of the Inland Revenue and Customs & Excise.
'We have been left in the dark and we are entitled to an explanation,' one MP on the committee said.
O'Donnell's report was originally due in December and is now expected to be published at the end of the month.
The Treasury denied that a turf war over the planned new Serious Organised Crime Agency (Soca) had delayed the report.
A senior mandarin at the Treasury said it was likely that the source of contention was about the body that would have control over a merged customs and tax department.
He told Public Finance: 'From our side, it makes sense that the Treasury should be in charge of the management of the new department, but there are issues that need to be worked through with our partners in the Home Office about who has responsibility for certain areas.'
The proposed changes will bring the investigative side of Customs & Excise, together with police and Inland Revenue staff, into Soca, which has been dubbed the British FBI.
According to some observers, this would give the Home Office responsibility for investigating tobacco and alcohol smuggling, a move some at the Treasury want to resist.
A source at Customs & Excise said: 'We believe that the crime fighting and smuggling work is what makes working at this department interesting. If that moves under the auspices of the Home Office, the work in any new department for customs staff will be largely administrative.'
O'Donnell is said to be keen to ensure that any new department will make changes that will simplify tax collection, and the Treasury source insisted that there was no turf war. 'We are examining all the options to come to the best solution for all concerned. There are two separate agencies being set up here and they are not in competition with each other. Each will have very different responsibilities. It is a matter of ironing out a few minor issues,' he said.
Revenue writes off £800m in NI payments
The government has confirmed that it is to write off almost £800m in outstanding National Insurance contributions because it has proved too difficult to collect.
In a parliamentary answer to Liberal Democrat Norman Lamb, Paymaster General Dawn Primarolo admitted that the Inland Revenue had abandoned attempts to recover the money because it was 'neither practical nor cost-effective to pursue the debt'.
Instead, the £789m in contributions will be written off. The figure covers unpaid contributions for the five years since the Inland Revenue took over responsibility for collection.
Reminder notes were suspended when staff in the then Contributions Agency were overstretched by problems caused by the introduction in 1996 of a new computer system.
The suspension was intended as a temporary measure, but no plan was ever put in place to start sending out the notices again. In the meantime, responsibility for the notices was transferred to the Inland Revenue.
Ministers first learnt of the problem in March last year when the paymaster general took immediate action, ordering the Inland Revenue to start sending out the reminders again.
Lamb said: 'This is an awful lot of national insurance that is legitimately due. The burden will fall on law-abiding taxpayers who pay their tax. I understand that some national insurance has to be written off, but this figure is way too high.'
It has also emerged that almost 1 million income tax returns are outstanding since self-assessment was launched seven years ago.
Stress drives female civil servants to the bottle
Women in the upper echelons of the civil service are so stressed by the experience that they are more likely to become 'problem drinkers' than their male colleagues.
A study published this week on bmj.com, the website of the British Medical Journal, found that the pressure involved in breaking into a male-dominated world led many senior women civil servants into problem drinking.
The researchers had asked civil servants about the demands of their jobs, the support available at work and home and the level of power they had in making decisions.
Some 10%-12% of male civil servants had an alcohol problem but there was no discernible difference in prevalence between those in clerical jobs and those in senior positions.
The picture for women was very different. Junior female civil servants were less likely to be problem drinkers than men in comparable grades. Among senior women, though, levels of drinking overtook those of men in similar senior grades.
A Cabinet Office source said there were several reasons for this, including a long-hours culture and the need for more sympathetic treatment for women who struggled to juggle a career with family life.
PFmar2004
