07 May 2004
Anne Chant, acting chair of the Inland Revenue, has committed the organisation to an 11-month deadline to improve its debt recovery procedures – following revelations that billions of pounds are being lost through bureaucracy.
Making her first appearance before the Commons' Public Accounts Committee on May 5, Chant told MPs that the Revenue would have in place dramatically improved collection procedures by summer 2005, including merged IT systems capable of hosting information on taxes and debts from multiple sources.
Her comments were aimed at staving off strong criticism from the PAC that more could be done to prevent tax debts from being collected at source, written off or not paid at all. The committee was examining a National Audit Office report that revealed taxpayers owed the revenue up to £14bn in the year to March 2003.
Chant explained that much of the £14bn debt was still being recovered, although she acknowledged that a large proportion had also been lost through businesses becoming insolvent.
But she was open about collection problems, explaining how the Revenue was still using troublesome 'legacy [IT] systems' that were slowly being 'bolted together' to improve performance. She added: 'Within the next 11 months we will have brought in the [system] management that we very much want.'
But MPs said they had real concerns about the slow nature of some debt collection. The NAO report, for example, revealed that almost £800m in taxes and 'miscellaneous duties' was written off during 2002/03, largely because the Revenue had failed to get cash from businesses before they were declared bankrupt, or because it had failed to trace individuals.
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