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My next point relates to taxpayer contact with HMRC. Much of our debate has focused on the concerns of employeesunderstandably sobut what about the quality of service being provided to the taxpayer? Will the office closures and staff reductions have an impact on that? We should remember that the tax system has been moving towards self-assessment; and the past 10 to 12 years has seen the introduction of the tax credit system, which imposes considerable demands on claimants and HMRC. It could be argued that greater self-assessment, tax credit claims and so on will result in the need for a more face-to-face service, with more people needing to meet HMRC staff in order to deal with their tax.
Mr. Anthony Wright: I agree wholeheartedly with the hon. Gentleman. Is he suggesting that the Conservative party manifesto will propose an increase in public-sector jobs rather than what we have been hearing for a number of monthsbillions of pounds-worth of cuts in the public sector?
Mr. Gauke: In this part of my speech, I am relying heavily on representations that I have received from the low incomes tax reform group of the Chartered Institute of Taxation. I question whether the reforms of HMRC are being done in the most efficient way. In representations to me, the group said that
by diverting resources away from front-line services, HMRC are not only making life more difficult for unrepresented customers at a time when the tax system is becoming at once more complex and more unforgiving of error, but also creating the necessity for more expensive interventions into taxpayers affairs. Alternative ways of contacting HMRC do not always work well, and exclude a considerable proportion of the taxpaying population who find the telephone or the internet beyond their skills.
What assessment have the Government made of the reforms? Do they accept that services are being transferred away from the front line, and do they consider that to be the best way for HMRC to be managed?
Mr. Wright: I agree with the hon. Gentleman. The one thing that we have done wrong is to remove front-line services; as a result, jobs have gone in the Department for Work and Pensions and in other areas. Over the past two and a half or three years I have been working extremely hard on the consultation, and I have come to know many of those in HMRC who work with individuals. It is clear and apparent that we need to increase the number of face-to-face contacts rather than diminish them. I merely ask whether the Conservative party spokesman agrees with that point of view. Is it his partys policy to increase front-line services in the public sector, and specifically within HMRC, should the opportunity arise?
Mr. Gauke: I appreciate what the hon. Gentleman says, but I believe that HMRC needs to be more efficient and more effective. The professional bodies are concerned that HMRC is not becoming more effective, and that problems are being stored up for later intervention. That is the point that I wish to put to the Minister.
A number of helpful points have been raised in the course of this mornings discussion. It was useful for the House to have had this debate, and I am grateful to the hon. Gentleman for initiating it. I want to give the Minister as much time as possible, to enable him to respond, but it is perfectly legitimate to ask serious questions about the effectiveness of the proposals.
The Financial Secretary to the Treasury (Mr. Stephen Timms): I congratulate my hon. Friend the Member for Great Yarmouth (Mr. Wright) on securing this debate and on the consistent and determined way in which he has defended his local tax office. I have not heard of anyone with a name like Mr. Brandon Lewis speaking on the subject. However, I am pleased to have the chance to respond to the points that have been made. I shall set out the rationale behind the exercise, but before doing so, I shall comment on what my hon. Friend said when highlighting the issues that face individual members of staff.
HMRC exists for taxpayers. It has to provide its service in the most efficient way. I shall set out later why it needs to restructure in order to become more efficient, but not the least reason is that it has to deal with the big challenges of tax evasion that have been mentioned today, as well as other challenges. It also needs to plan its office structure to suit its new business models. Many private sector organisations would expect staff to move to where the work is; in contrast, HMRC has gone to great lengths to work with staff, taking personal circumstances into account whenever it can. However, HMRC has to keep those office buildings that are the most useful to it from the business point of view.
My hon. Friend and others made the point that now is a difficult time for staff in any office that is to be closed. I put it on that record that what is proposed is not a reflection of the performance of those staff. Most HMRC staff, particularly those in smaller towns, have a large amount of valuable experience, which is why staff are being asked to move with their work, whenever that it is possible.
Throughout the programme, senior HMRC management have been, and continue to be, committed to being open with staff, explaining the options to individuals and exploring how their expectations can be matched with the need to make business operations more efficient. After decisions are announced, individual staff members have the opportunity to discuss their personal circumstances with managers and to determine their suitability for relocation. That is backed, as it should be, by a trade union-supported appeals process.
In making those judgments, HMRC takes account of personal circumstances, such as the caring responsibilities rightly mentioned by my hon. Friend, as far as is possible, given the constraints of the need to rationalise the office network. HMRC will provide staff with as much flexibility as it canfor example, by allowing a change to working patterns, provided that it meets the needs of its businessbut I cannot give my hon. Friend the assurance that no member of staff will be inconvenienced by the changes. None the less, a great deal is being done to minimise the difficulties.
Mr. Anthony Wright:
We are not talking about an individual member of staff; I know of dozens of members of staff who are finding things extremely difficult. I can understand perhaps that one or two might fall through the net, but about 30 or 40 per cent. of the 135-strong work force at Havenbridge house are going to find things extremely difficult. Multiply that across every other constituency, and we have a considerable number of people who will be given no alternative but to lose their jobs. They have not been taken into account. Will
the Government not admit that they have got this wrong? Perhaps we should review the estate and make savings there.
Mr. Timms: I think that the circumstances of 103 members of staff at Great Yarmouth are being looked at. HMRC is considering how best to accommodate those who cannot move with their existing business while continuing to do appropriate work. A range of options and support is being offered including, for example, redeployment to another business stream in HMRC within reasonable daily travelling distance, assisted home moves for staff to fill posts elsewhere in the Department, a public sector release scheme that offers grants to staff leaving for other front-line public sector jobs and, where available, moves to other Departments.
In January, HMRC signed an agreement with the Department for Work and Pensions. For reasons that we all understand, Jobcentre Plus needs to recruit additional staff. Until a solution can be found, work will continue to be fed back to staff in this position. HMRC is phasing the closure of buildings by partial vacations, which will help to achieve some financial savings, and to accommodate in the interim those staff who cannot move for the types of reason set out by my hon. Friend. The work of reviewing the position of each member of staff will be complete by the end of the month, and it should then be possible to be much clearer about the likely time scale for individual offices to remain open, given our determination to minimise, or preferably avoid, compulsory redundancies. Staff at Great Yarmouth have been told that the office will close by spring next year, but it is pretty clearhe drew attention to some of the reasonsthat a number of staff will continue to work in the Great Yarmouth office well after that. As I said, however, details should become clearer next month.
I understand the strength of the concerns expressed by my hon. Friend and others, but I would like to set out the context of the work force change programme. We have long challengedI know that my hon. Friend supports thisall Departments to increase their effectiveness while making significant efficiency savings. In HMRC, as elsewhere, that can be done only by making radical changes. That was a key reason behind the merger of the two former DepartmentsInland Revenue and Customs and Excisein 2005. The merger was designed to create efficiencies by cutting out the duplication of function and effort. Was that an easy change to make? The hon. Member for Rochford and Southend, East (James Duddridge) criticised the way in which that merger has worked out. It is true that these are difficult changes to bring about, but if our aim is to have the most efficient possible delivery of public service, that is the sort of change that we must be willing to make and we must ensure that it succeeds. We are now enabling the combined organisation to reduce the size of its office network. HMRC recognised from the start that it would have to set itself up on national business lines to achieve the benefits of integration and to be in a position to respond more quickly and effectively to changing demands.
The old Inland Revenue was a geographically-based regional organisation, and it was clear from the start that that was not an appropriate way of organising HMRC, which inherited two separate office networks comprising nearly 600 office buildings across the UK.
The former Inland Revenues network of small local offices had developed historically to meet the needs of local employers and taxpayers. Originally, most local offices had a local customer base, but even before the merger that had largely ceased to be the case. The old idea of a local tax office simply serving the local community has long been obsolete.
Dr. Gibson: I want to cut through some of the information that the Minister has provided. What is the difference in rent between offices in Norwich, where it is proposed that people from Great Yarmouth will be housed, and those elsewhere? When will we know? Is he in possession of a document containing such information, or must we use the Freedom of Information Act 2000?
Mr. Timms: I am grateful to my hon. Friend for raising that point, because the exercise is not about simply finding the cheapest offices in the country. That has been a serious misunderstanding throughout this debate. The question for HMRC is: how best can it organise its business to deal, for example, with the challenges of tax evasion? That is not about finding the cheapest possible office space in the country. That has not been a driving consideration.
For a long time now, we have not had local tax offices whose job it is just to serve the local community. Thirty years ago, work on pay-as-you-earn for those working in London was moved out into large regional centres. That did not damage customer service, because PAYE work does not require local knowledge, and nor does the other high-volume processing work that HMRC is concentrating in a much smaller number of large units. Most staff in local offices, therefore, do not have regular contact with local customers. An increasing number of people prefer to do business with HMRC by telephone or over the internet.
In response to the question from the hon. Member for South-West Hertfordshire (Mr. Gauke), some taxpayers and claimantstax-credit claimants, for examplewant the reassurance of being able to call in to a local enquiry centre, and they must continue to have that opportunity. Inquiry centre services, where people can get free face-to-face advice, will continue to be provided at or near all their current locations, including in Great Yarmouth. In the current economic climate, which has been referred to in this debate, it is more important than ever that HMRC uses its resources to best effect. The Conservative party argues that £5 billion should be cut from public spending, with effect from next month, but that is an extremely ill-advised policy. We must continue to improve customer services while managing costs downward. One way to do that is to consolidate teams of staff in particular businesses into a smaller number of locations. That can introduce new and more effective working practices, resulting in more work done by the same number of staff.
HMRC has to achieve efficiency savings that roughly equate to a reduction in staff of about 25,000 between 2004 and 2011. Very substantial staff savingsdown from 105,000 to 89,000have been made already without any compulsory redundancies. Furthermore, it was clear that 40 per cent. of the office space with which the organisation started would no longer be needed by 2011-12. For example, the office in Great Yarmouth can accommodate more than 250 people, but it currently houses just over 100. We need to manage the process of ensuring that the organisation has the necessary office space to do its job.
Judy Mallaber (Amber Valley) (Lab): I am delighted to have secured this debate on abusive images on the internet. The internet opens a window on the world in a wonderful way, enabling us to find information and communicate with others, but we must be vigilant about the ways in which it can be misused. I shall focus on three areas today and ask the Minister to crack down further on access to images of child abuse on the net; to put pressure on the social networking sites to take down and monitor proactively disturbing videos; and to continue to promote the education of young people about safety on the net.
A huge amount of work on all those matters has been done in the UK by Government, internet service providers, childrens charities and the police. I pay tribute to all of them and to the Child Exploitation and Online Protection Centre. I am delighted that my hon. Friend the Minister for Security, Counter-Terrorism, Crime and Policing is to reply to the debate, as he did a massive amount of excellent work when he had direct responsibility for policy in this area. I also thank John Carr, secretary of the Childrens Charities Coalition on Internet Safety, who first alerted me to the issues and briefed me for this debate.
First, I come to images of child abuse. In my own area and elsewhere, we have people who use the internet to download thousands, or even tens of thousands, of images of child abuse. Recently in my patch, a GP was convicted of such a crimethe second such case in my area. Each image of child abuse represents a real child or a baby being raped or otherwise abused. The crime is not one of someone innocently looking at a Lolita-type image. The Internet Watch Foundation tells me that half the images uncovered are of children under 10 and more than half depict the worst categories of abuse, which makes it almost impossible for any normal human being to watch. The idea of someone downloading the image of a baby being raped for their sick gratification is extraordinary.
The UK has an exemplary record on dealing with child abuse images on the internet. We can all feel justly proud that no other democracy in the world can match our achievements. Many other countries are copying the British approach and, as we know, imitation is the sincerest form of flattery.
When records of such images first started to be kept in the late 1990s, something like 19 per cent. of all the child abuse images found on the internet in the UK were also being published by servers physically located in the UK. Today, that proportion has gone down to around 0.2 per cent., which is a fantastic success. That is in no small part due to the work of the IWF, which was founded in 1996 by the internet service providers.
For those who do not know the history behind that developmentI know that my hon. Friend the Minister doesI will explain how the system works. The IWF receives a report of an alleged illegal image. The staff look at the image and if they confirm that it is illegal and it is housed on a server within the UK, a notice is issued to the UK host and the police. No UK ISP has ever been prosecuted for child pornography offences because they all act immediately to remove such images
the instant they receive a notice from the IWF. British ISPs also block the Usernet newsgroups of which they are notified by IWF when abusive images keep reappearing.
To eliminate nearly all abusive images on servers hosted in the UK is a great success, but the other 99 per cent. plus of child abuse images reside on overseas servers in which the IWF writ does not run. The local police may be notified, but whether or not action is taken depends on the way in which the police operate, on the systems in those countries and on the speed of response. Child abuse websites hosted overseas are available via the world wide web to anyone anywhere in the world, so they are available to UK residents to download. That in turn puts UK children at risk, because a proportion of the people who download such images are likely to go on to act out in real life some of the sexual fantasies involving children that have been fuelled by those images. Do not think that such people just look at those images, appalling though that is.
At the Derbyshire safeguarding children board annual meeting last Friday, Jim Gamble from CEOP discussed some recent research, which may not have yet been published. Of those sent to prison for downloading child abuse images, only 26 per cent. said that they had been involved in a contact offence. Obviously that is bad enough, but when they were re-interviewed using polygraphs, 90 per cent. were found to have gone on to engage in contact offences. Therefore, they had committed offences both online and offline.
The problem is not just that someone might go on to commit contact offences, but that the trade in such images puts UK children at risk of abuse. By definition, those images are evidence of a crime that has been committed against the child depicted in the image. Every re-publication of the image is, in a sense, a way of re-abusing the child. Very often, people say. Why are you taking action against people who are just downloading and looking at images? They do not understand the seriousness of the crime. The crime is one of children and babies being abused and raped solely for profit and sexual gratification, and that is just unbelievably appalling.
It is very difficult to identify and locate those children. Interpol says that it has identified and rescued 900 children, but many more are out there being abused to service the trade. Anyone who downloads such disgusting images is contributing very directly to keeping in business a commercial trade that is often run by organised criminal gangs. Moreover, they are ensuring the continuation of other methods which may not involve criminal gangs but which involve the trade in images of children being abused. They are directly contributing to the abuse of the children shown in the images; they are abusers by proxy.
Many of us have been considering better ways to disrupt and reduce the traffic in child abuse images. In 2004, in Prime Ministers questions, I was able to welcome the steps taken by BT to develop its cleanfeed technology. It showed how it could take the IWFs list of known child abuse websites and use the cleanfeed system to block access by all its customers in those sites. Anyone using cleanfeed technology to access the internet would not be able to access any of the sites notified by the IWF, including those hosted overseas from which most of the images come. Obviously, such a system is not foolproof, but it clearly has limited hugely and prevented a range of illegal and accidental access.
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