Concentrix

Chris Law Excerpts

Wednesday 26th October 2016 Commons Chamber

[Rebecca Long Bailey]

My hon. Friend is right. Sadly, however, when many people tried to complain to Concentrix, all they received was a dull engaged tone, so they did not get very far.

Will the Minister assure the House that she will go beyond the scope of the motion and investigate such contracts more widely? She should consider putting measures before the House that will prevent the incorrect application of payment by results. I fear that Concentrix is just the tip of the iceberg.

[Chris Law (Dundee West) (SNP)]

I have just looked at how far back payment by results goes. Will new Labour, or old new Labour, take some responsibility—payment by results was introduced in the English NHS in 2003-04—and condemn it roundly in the Chamber today?

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[Jane Ellison]

I will come on to that, but the hon. Lady has provided me with an apt moment to be clear about what I said on that day. I said that once we had established the facts of the case, people should be paid within four working days. Clearly, some cases are complex and need further details to be provided. In response to the urgent question, I said that once we had established the facts, an automated process would authorise payment to be made within four working days. That is the timeline to which HMRC is working.

As I have said, it is absolutely critical that we get the right information, establish the facts and get payments started again. To that end, HMRC took back from Concentrix 181,000 incomplete cases, and staff have been working hard to resolve them. I can update the House by saying that 178,000 of the 181,000 cases have already been finalised, which represents 98% of them. HMRC has already written to the people concerned in the other 2% of cases, and it should conclude those cases by the end of this month. I want to place on the record my thanks to HMRC staff for their efforts in that regard. HMRC staff are also taking on reviews that are requested of any decision made by Concentrix.

[Chris Law]

It is startling that 98% of cases have been resolved within four weeks. Is there any evidence whatsoever that there were grounds to pursue people over their tax credits in those 98% of cases, or was this a bogus fishing expedition, as all of us in the House are likely to believe?

[Jane Ellison]

It is important to recognise that when a case is resolved, it means that a conclusion has been reached based on the facts. I cannot give the House the breakdown of cases in which payments have been reinstated, cases in which there was in fact an error in the claim that had to be corrected, or indeed cases—a very small number of them—in which claims were fraudulent. The point is that the cases have been resolved according to the facts provided and in the knowledge of the person concerned. We may be able to provide a breakdown at some point, but I am not in a position to do so today.

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[Kevin Foster]

This afternoon we received a fairly detailed report produced by the National Audit Office on HMRC’s annual report, which is being discussed by the Public Accounts Committee and which goes into some depth about HMRC’s performance and customer service standards. It can be read in comparison with what we have heard about Concentrix. The PAC is also discussing the tax gap, and the need to ensure that HMRC is performing as we would expect it to in ensuring that the taxes for which we legislate in the House are paid by those who are required to pay them. I genuinely welcome the fact that the National Audit Office will be investigating this matter, and, in that context, I think that some of the comments that have been made today may have been slightly premature.

I was going to intervene on the shadow Minister when she was commenting on our having an independent and fearless inquiry commissioned by the Government. I was struggling to think how more independent and fearless an inquiry could be than a report by the NAO, which is an arm of this Parliament, not of Government. It produces its reports independently. Yes, it will liaise with Treasury officials to ensure that facts are agreed when coming to its conclusions, but ultimately the Comptroller and Auditor General and his team answer to this House via the PAC. It has never held back from making comments, no matter how difficult and challenging for Government Departments, where required. The shadow Minister might wish to intervene and tell us how she felt that another inquiry would be different from that, but I think the right way forward is to get the NAO to look at this and bring a report that can be scrutinised fully and in depth in this House from a team of subject experts who understand how HMRC, the DWP and the benefits system work, and who owe a duty to Parliament, not to the Government. I am sure the depth of information they bring forward will inform future debates on this subject.

[Chris Law]

Is it not clear, then, that the approach over past years of reducing HMRC staff numbers must stop, and stop today? The current Government programme to reduce staff numbers from 55,000 to 35,000 is short-sighted, and from the evidence we have heard today it is clearly time to reverse that.

[Kevin Foster]

I encourage the hon. Gentleman to read the HMRC report being discussed this afternoon by the PAC; it might be worth his attending the session if he gets the chance. It is worth noting that with new leadership, which has been needed for some time, HMRC is starting to turn around its customer service, by moving more staff into dealing with post, for example. There is some evidence that the customer service is improving, therefore, which is welcome, although I know that some of these assertions will be robustly tested by a number of Members, including the hon. Gentleman’s party colleague and PAC member the hon. Member for Coatbridge, Chryston and Bellshill (Philip Boswell).

It is vital that the investigation is full and that we look at what comes out of it. I welcome the Minister’s saying that there is an ongoing negotiation about concluding the contract early. We cannot go into the details of that today for obvious reasons, but I hope the work being done to bring this whole sorry tale to an end will be shared with the NAO as part of its inquiry.

One of the conclusions to be drawn is that it is clear that people have been caused pain and suffering that they should not have been caused. People have been subjected to allegations that were flagrantly untrue: the “philandering shop”; the person living down the road; someone who has been dead for some years. We should think about the way the contractor went about things—sending letters with the contractor’s logo that looked very similar to official Government or HMRC letters. We might have debates about whether in future the symbol of the Crown and HMRC should be used on a letter sent by a contractor.

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[Chris Law (Dundee West) (SNP)]

I have spoken a number of times in Parliament on this subject, and every time I speak I listen to the many stories from across the Chamber and elsewhere about individual cases. My constituency is no different in the way that individuals have been affected by Concentrix, which is contracted by HMRC on behalf of this Tory Government As I said in my early-day motion 396, HMRC’s contract with Concentrix is driving families into immediate poverty.

Let me offer the House a few examples. One of my constituents who I spoke with had only part of her address held on the Concentrix system. When background checks were run on the address, a number of people were named as living at the same property. As a result of a needless investigation by Concentrix, this person struggled to feed and clothe her children for over a month. Another lone parent was judged to have made a false claim as a single parent. Following my complaint, it was discovered that an incorrect address had instigated the investigation and, in fact, HMRC owed this constituent a considerable sum of money. Sadly, this was not uncovered before the constituent had to give up her home due to financial hardship. Such cases reinforce the points that have been made in the debate.

[Tommy Sheppard (Edinburgh East) (SNP)]

Does my hon. Friend agree that another aspect of this shambles is the at times near-complete breakdown in communication between Concentrix and HMRC, as exemplified by my constituent Dionne Walker, a mother of three, who supplied Concentrix with every single piece of information it asked for, only to find out subsequently that Concentrix had not passed it on to HMRC? Her tax credit application was cancelled, leaving her having to seek crisis loans and go to food banks to feed her three children for the rest of the week. Does my hon. Friend agree that that is unacceptable, and that people such as Dionne Walker and countless thousands of others are owed an apology by this Government?

[Chris Law]

Indeed. I hope to hear such an apology from the Minister this afternoon. My hon. Friend’s example makes the point that I was about to raise—make no mistake, many of these people are single parents, who are already struggling to make ends meet and are the target of this Government.

Evidence has now emerged that Concentrix, on behalf of this Government, sent out, over a two-year period, almost a million letters asking for information about people’s circumstances, in what can only be described as a fishing expedition to detect potentially irregular tax returns. It is up to the constituent to prove that they are innocent before tax credits are reinstated. In other words, they are treated as guilty until proven innocent. It does not end there. Reports suggest that staff at Concentrix are regularly dealing with suicidal callers who threaten to kill themselves. How desperate does the situation have to get before urgent action is taken and the contract is ended?

The social and health impacts of the Concentrix contract, on both members of the public and employees, are horrific. That has been reinforced in the recent report of the Work and Pensions Committee, which found evidence of humiliation of claimants and appalling customer service, and appeal success rates of between 73% and 95%, described as

“a terrible indictment of the original decision-making process”.

Unsurprisingly, this is not the first time that Government outsourcing has failed to meet expectations. I made the point earlier that these payment-by-results contracts go back to 2003, when Labour introduced them for NHS England. I am sure everyone in this Chamber remembers Atos, whose shambolic and cruel tests were designed to strip away benefits from sick and disabled people.

Under the contract that this Government have with Concentrix, Concentrix is paid on a payment-by-results basis—in short, commission. The more tax credit payments Concentrix puts a stop to, the more money it pockets. Our constituents, who are very often in low-paid, part-time work, find themselves at the rough end of a contract that many of us would never sign up to in jobs in our everyday lives. How different the decisions made by this Government would be if Government Members were put on payment-by-results contracts.

It is hard to believe that this Government continue to cut HMRC jobs in Dundee and right across Scotland, while at the same time privatising and outsourcing contracts. HMRC departments, which are already understaffed, have been left to pick up the pieces and have spent months restoring backlogs of claims and errors. It is time to end this madness.

Although Concentrix certainly has questions to answer, I believe that the disastrous implementation of the Concentrix contract by the Tory Government has implications that go far beyond that specific company. This Government have created a system designed to place the burden of their failing austerity agenda firmly on the shoulders of those most disadvantaged in our society. The contract with Concentrix has not been renewed, which is a step in the right direction, and it looks as though it will shortly be brought to a close, which is good news. However, the Government need to go further.

Alongside the ongoing investigation of the Concentrix contract by the Work and Pensions Committee, an inquiry has been initiated by the National Audit Office. I welcome these developments, albeit at a time when too many of my constituents have already suffered. I urge the Government to set up a public inquiry to examine the conditions under which Government Departments award public contracts to private sector providers. Such an inquiry would offer reassurance to members of the public who are weary of hearing disaster stories from the NHS, HMRC and the Department for Work and Pensions. Among the aspects that I believe deserve particular attention are how to devise contracts that ensure value for money and efficiency without allowing companies to profit by manipulating results and ignoring the well-being of people in our society; a clear statement of ethical principles to emphasise justice for individual citizens and parliamentary accountability; and representation of consumer and service user groups in decision making at all stages of formulating, awarding and monitoring contracts.

In the end, everyone in this House must remember that we are privileged to be here and serve the public. In that spirit, I urge this Government to re-examine all their contracts with private companies and ensure that dignity and respect, rather than profit and price, are at the heart of procurement.