HMRC: The Control and Facilitation of Imports - Public Accounts Committee Contents

Examination of Witnesses (Questions 80-99)


9 MARCH 2009

  Q80  Dr Pugh: But you can tell us who made the errors.

  Ms Dawes: I cannot tell you who made the errors no, I am afraid not.

  Q81  Dr Pugh: The companies that benefited from the errors then?

  Ms Dawes: No, I am afraid I cannot give you any individual names of companies, no. We are not able to do that.

  Q82  Dr Pugh: They obviously had a huge significance.

  Ms Dawes: It is the sort of thing that happens with large business work all the time. We do get large amounts of money. From the nature of these companies they are accounting for very large amounts of trade and large amounts of duty and so when we have an individual issue with one company it can have a big impact on the figures. I was really just trying to explain that if you take those impacts out there is a fall in the yield from the large business side.

  Dr Pugh: It must be a very big company.

  Q83  Chairman: Why do you say you cannot give the names of the companies? Perhaps you cannot give them in public session but you can send us a note.

  Ms Dawes: We are not able to release those figures in the public domain. I think this is a debate that we have probably had with you before.

  Q84  Chairman: We would not release them. You cannot just announce to the Committee that you are not prepared to give a parliamentary committee the names of companies in confidence. You do not have that right.

  Ms Strathie: I think you know we are bound by taxpayer confidentiality and you did point out earlier that if we give you something in confidence you then decide whether it stays in confidence.

  Q85  Chairman: I am not asking you to reveal the individual's tax affairs, we are talking about companies. We often get given details about companies, for instance from the Ministry of Defence. Are you refusing point blank to give us this information?

  Ms Strathie: That is our position because of taxpayer confidentiality. I know that you often receive information about companies and indeed very often when something is in the public domain, perhaps as a result of prosecution or something else, then those matters become public. However, regarding the tax affairs of individual companies that is not something that we can reveal.

  Chairman: We may have to think about that; I may have to take this up with the cabinet secretary I think. Mrs Browning?

  Q86  Angela Browning: I wonder if I could bring Mr Clark back to sea ports. I do think it is extremely concerning that the NAO Report tells us, "We were not able to determine the number of examinations at ferry ports as detection officers do not record the country of origin of arriving vehicles." That seems to be rather important that they are able to say exactly the number of vehicles they examine. Surely that cannot be right even in the turmoil of what you have all inherited.

  Mr Clark: I think the Report reflects that there has been recording but it has been inconsistent and patchy right across the estate and the ports. We have taken up some measures to get the end of shift report—as I think it is referred to in the document—much more consistently done and in a way and format that can more ably help the statistics and the understanding of what is actually going on. We are looking at other ways of getting that information rather than relying on the end of shift report. We are looking at more effective ways of doing that and ways that are more technology based and then getting a report at the end of shift.

  Q87  Angela Browning: How do you know whether people are actually doing their job or just sitting down having endless cups of coffee if there is no record of what they have actually been doing, never mind what they might have missed in the meantime?

  Mr Tweddle: The problem that we had was whether it was an intra-community—something moving within the community—or was it from a third country? The officers were recording what they had done and what success or otherwise they have achieved, but they were not always putting down whether the consignment was from within the community or from outside it.

  Q88  Angela Browning: Have you corrected that now?

  Mr Tweddle: Yes.

  Q89  Angela Browning: Is that all part of what we read on page seven, paragraph 23 as the establishment of the Customs Strategy Delivery Group? Is that anything to do with solving some of these problems that are outlined in paragraph 23 which gives quite a poor description of the way these matters are managed? What does this Customs Strategy Delivery Group aim to do?

  Mr Tweddle: I chaired that group and what it seeks to do is to bring together all the elements which were involved in the customs process and so you are absolutely right, we are looking at a performance framework, we are identifying each of the elements where we want to improve performance, including the examinations carried out by the Border Agency so that can help to improve the targeting and the resource deployment.

  Q90  Angela Browning: Was that set up before you saw even the first outline draft of the NAO Report?

  Mr Tweddle: Yes, it was.

  Q91  Angela Browning: It was something that you had already identified needed to be addressed.

  Mr Tweddle: Yes.

  Ms Strathie: Implemented following HMRC's capability review.

  Q92  Angela Browning: Can I just ask each of you a question? It seems to me that this is really quite an appalling catalogue of mismanagement and a laissez-faire approach. From each of your individual responsibilities what is the weakest link in your organisation?

  Ms Strathie: Can I phone a friend?

  Q93  Angela Browning: You have all told us you are getting your act together in the light of this Report, but what is the weakest link?

  Mr Tweddle: The weakest link is the lack of an in-depth understanding of the risks that we are facing. As Ms Strathie has said, what we are trying to do is facilitate legitimate trade but to identify that very small proportion which, for one reason or another, is illegitimate. We want to do that better so that we are not affecting the legitimate traffic and we are being effective in stopping the illegitimate. We recognise that our risk frameworks have not been as robust and as extensive as they need to be and that work is in hand so that we will be better in the future.

  Q94  Angela Browning: Mr Clark, the ports?

  Mr Clark: I would put it a different way and say that in the development of pulling together the UK BA the two big areas that we just have to get finished and right are firstly around the powers that staff have at the ports to carry out their duties as Border Force officers giving them access to current customs powers and also to immigration powers, and secondly to make sure that the intelligence, the risk assessment and the targeting is working as effectively as we can get it.

  Q95  Angela Browning: Can I ask you about ports where there is no permanent staffing but you said if they received intelligence information they would be deployed there? In another debate in this place in relation to illegal immigration as opposed to goods coming in I can think of an example which I personally witnessed in a small port but one which had links coming in from Europe. I will not do it because I think it would be very irresponsible to do it, but I can think of at least three or four ports of the same kind along our south coast that would actually give me concern. Are you not concerned about this plethora of small ports that are not manned and are not checked, from your perspective not from the illegal immigration perspective?

  Mr Clark: In terms of the deployment, as I said earlier we have more mobile capability now, particularly in the south, to deploy to places where there is no permanent presence. The bringing together of borders and immigration allows us to have much greater flexibility in using people in the broadest range of duties at those smaller ports. We get a much better bang for our bucks and are much more able to deploy than ever before with the new arrangements. That is why I think actually for me much of the concern to get right is the intelligence and the targeting of that resource and making sure we get that right to the highest risk areas and in a speedy way. So we have the resource; that is emerging out of the new UK Border Force. We are actually visiting more small ports now than we have done for many, many years. That is being reflected by the ports themselves who are seeing us there and we want to build up better relationships so that the feedback loop from small ports is more effective in inter-intelligence arrangements.

  Q96  Angela Browning: Are there any more weakest links?

  Ms Dawes: One of the difficulties is that we do not always have the management information systems that we would ideally like to be able to draw together this information, to analyse it properly and that can be very difficult. I think the end of shift report is a really good example because that was a local management initiative where local managers wanted to have some kind of way or recording the work they were doing, checking the outputs and looking at their efforts and the impact of those efforts over a period of time. We extended that system across the whole detection service which was a good thing to do, but in the end it is something that is relying on manual data, on individual staff that are entering results into a system that has not actually been properly put together on a stable IT platform.

  Q97  Angela Browning: Why is that? Are you held back by lack of resources or is it technology on the IT front?

  Ms Dawes: I think we always have to prioritise and this is an area where UKBA have already made some improvements and are looking at where they might be able to build a more strategic solution across the whole range of activities at the border.

  Q98  Angela Browning: Ms Strathie, I see you are not going to confess anything.

  Ms Strathie: I think management information and risk would be the areas that I would look at because we are an island, it is quite different from a country with lots of land mass around. That means that we will be constantly having to review risk and constantly redeploying resources and using all the intelligence we have. Having good systems, skilled personnel and being able to move quickly to tackle risk I think will be a challenge for us like any organisation and continues to be a challenge for UKBA.

  Mr Clark: I think we have made moves in very positive ways in that direction and I am not sure that I would like to reflect that as a weakest link but it is a very, very important area of development for the future.

  Q99  Angela Browning: I notice on page 24 when it talks about correcting over payments, traders have to apply for interest due at a rate of 5%. Is there any question that you are going to change that 5% rate?

  Ms Strathie: It changed in January.

  Mr Tweddle: When I was re-reading the Report I realised that in these days the rates of 8.5% and 5% might seem to be not appropriate. They did actually change in January. The rate which HMRC charges on overdue money has been dropped to 3.5%; the rate that we pay on money that we need to repay has dropped to zero.

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