Select Committee on Treasury Minutes of Evidence

Examination of Witnesses (Questions 160-174)


14 MARCH 2007

  Q160  Jim Cousins: If they do not tell you, and they will only tell you if they have read to page 30 of the advice booklet.

  Mr Orhnial: I cannot remember the shape of the form. Do you, Sarah?

  Ms Walker: It is not 30 pages.

  Q161  Jim Cousins: Roughly what number of pages would you have to read to get to that point?

  Ms Walker: I suspect it is around about—

  Q162  Jim Cousins: Could you let the Committee know how many pages you would have to read?

  Ms Walker: I would say something like six or seven pages. I can certainly check.

  Q163  Chairman: The Chairman of the Social Security Advisory Committee, Sir Richard Tilt, said that the operation of the Memorandum of Understanding between the SSAC and HMRC "continues to cause us concern". I think that Memorandum is under review at the moment. What is the problem?

  Dawn Primarolo: I do not know. Presumably the difference between being appointed by the Secretary of State and attached to DWP and being on a Memorandum of Understanding with the board of Inland Revenue which is constructed in an entirely different way with different accountabilities to Parliament. I would have to speculate, I am afraid. It is under review, yes.

  Q164  Chairman: So the problem is the statutory basis of the Advisory Committee?

  Dawn Primarolo: The Advisory Committee is appointed by the Secretary of State for DWP and has obligations through DWP. DWP does not have a board like the Revenue does with split responsibilities. A structure for the HMRC has been recently confirmed in its legislation. The Secretary of State for DWP appoints the committee and he is accountable for all of DWP. In HMRC there is a division of responsibilities and the board itself in HMRC has accountabilities and requirements to report and does not appoint that committee. What happened when the Tax Credits Bill was discussed was it was agreed that there would be a Memorandum of Understanding, which exists, and that is under review. The review has been triggered and it is being looked at in terms of its operation.

  Q165  Chairman: The Citizens Advice Bureau tell us that there are both overpayments and underpayments arising in situations where a child stays on in full-time non-advanced education after 16 but mistakes are far less common on the child benefit side. Why can a claimant not contact HMRC once only to report a change in circumstances that affects entitlement to both tax credits and child benefit? Could information not be shared between the tax credit teams and the child benefit teams?

  Dawn Primarolo: It is.

  Ms Walker: The rules are slightly different in terms of when child benefit stops and when tax credit stops in relation to people leaving education, and that is simply because of the historical basis of child benefit legislation which is older than the tax credit legislation. At the moment we do not share as much information as we ought to between the child benefit system and the tax credit system because of the limitations particularly of the IT system but we are working very hard on making sure that people only need to tell us once when something like that is happening.

  Q166  Chairman: So there is no legal problem about sharing information of that kind?

  Ms Walker: Not at all.

  Q167  Chairman: One of the recommendations we made, and it is an issue we have discussed with you before, was the extent to which HMRC is prepared to make data available in the way that DWP do, understanding the position of confidentiality, but aggregate data so that those outside Parliament, outside HMRC, in the universities and think-tanks and so on, can start to analyse the progress that you are making. You have not responded very positively to that.

  Dawn Primarolo: I do not agree, I do not think. There is the section 40 report, the annual report which has just been published. There are all the statistics which HMRC regularly publish. There is the external evaluations which are published when completed. There is the information provided both to committees and to Parliament. There is a lot of information on tax credits. What happens is that on occasion people ask for information that is not there and think that it is being withheld and it is not. Precisely the reason for having the section 40 report when it was added to the Tax Credits Bill was to provide that wider summary and the take-up figures are done, the statistical figures on overpayments and fraud and error are around.

  Q168  Chairman: Your answer to our recommendation was that you agreed with it, you said you gave a high priority to it and you put information on the website and have analysts analysing the information, but what we were concerned about, given we have now been running for four years, was whether sufficient information was available to the academic world, for example, or whether you at some point will commission independent studies, whether there is enough data out there so you are not the sole people looking at this.

  Dawn Primarolo: We have announced the evaluations and research that the external bodies are conducting on HMRC's running of the tax credit system. By virtue of the fact that they are conducting the research that gives them access as well to the information inside HMRC, so I do not see that is a danger. I cannot remember, to be honest, whether we have submitted separately to the Committee the commitments on external evaluations and where those are taking place but we can certainly provide that.

  Q169  Chairman: Perhaps a list would be helpful if you could provide that.

  Ms Walker: We are increasing the amount of information we publish all the time. This year for the first time we have published take-up statistics broken down to a very small geographical area to ward level which was something that we were being asked to publish. We are working to improve the amount and detail of the information that we publish.

  Q170  Chairman: Beyond the section 40 report, will you get to a position where you produce an annual report on the whole system?

  Dawn Primarolo: Forgive me, what would you want to see in it? Section 40 explains all of the position with regard to take-up. Are you suggesting that HMRC should produce a glossary of all the considerations of Parliament and all the information that has been given in different places in one consolidated point?

  Q171  Chairman: One difficulty we have, and we have had it this afternoon, is by the nature of the system you are running some of the data is now quite old and you are not able to, if you like, score off particular years for a year or two years after they have ended. Now we have got the system a little more mature and up and running, I am wondering whether we are able to see, for example, the extent of overpayment recovery over a three year period or whatever and whether you would not consider a wider form of annual report that summarised each year.

  Dawn Primarolo: You are talking about a subsection in the Department's annual report. Can I take that away and consider it and respond to the Committee?

  Q172  Chairman: Of course, that would be extremely helpful. You have promised us, I think, quite a list of other information.

  Dawn Primarolo: Indeed. We have taken notes but it would be very helpful to have a reminder.

  Q173  Chairman: We will be in touch with you about that.

  Dawn Primarolo: Promptly.

  Q174  Chairman: Minister, can I thank you and your officials for coming here today. We will return to these matters in the very near future—tomorrow. Thank you.

  Dawn Primarolo: Looking forward to it. Thank you very much.

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