Newry HMRC Centre

Jim Shannon Excerpts

Tuesday 3rd December 2013 Commons Chamber

[Ms Ritchie]

I thank my hon. Friend for his useful intervention. I agree wholeheartedly that there is a need for this service, particularly in regard to cross-border working, as there is a considerable interchange of population between the north and the south. In his case, it is between Derry and Donegal; in my case, it is between Newry and Dundalk. In my area, there is a memorandum of understanding between both councils, north and south, to deal with economic issues in order to pump-prime the local economy.

[Jim Shannon (Strangford) (DUP)]

Does the hon. Lady feel that the closure of the office with the loss of 134 jobs will affect the ability of the Treasury to bring in the revenue that this country needs?

[Ms Ritchie]

The face-to-face services provided by HMRC in Newry are vital to my constituency, because of the lack of access to broadband and the need to deal on a cross-border basis with matters such as tax avoidance. Newry’s strategic location means that it is vital to have those services there.

The programme of voluntary exits for staff cannot be euphemistically explained away by the normal rhetoric of “modernisation and streamlining”. It represents the wholesale removal of vital face-to-face and personal tax services, and a distinct refashioning of the link between people and revenue collection. My hon. Friend the Member for Foyle (Mark Durkan) has just made that point as well. Time and again it has been reported that consumers and businesses prefer face-to-face transactions when dealing with tax and revenue issues. The new strategy will have severe limitations, particularly when complex matters are being discussed.

The decision will drastically alter the link between the community and a vital public service. That point has been made by my hon. Friend the Member for Foyle, as well as by the hon. Members for North Down (Lady Hermon) and for Strangford (Jim Shannon). That is already a problem, and I know that many local people and businesses already struggle to access services from HMRC. People can feel disconnected from the system, especially in Northern Ireland, and that will be further exacerbated by the changes.

It might seem more efficient for the Treasury to implement these changes, but it will almost certainly not be more efficient for those people forced to rely on telephone lines, with all the long delays involved, or for those who lack access to the internet or find it difficult to use modern technology. This could leave many people isolated from access to vital services, particularly at a time of widespread changes to the tax and benefits system.

South Down and the region supported by the Newry HMRC centre are predominantly rural areas and as such they face all the problems associated with that, including limited broadband access and people living in remote and isolated locations. Those people cannot simply be expected to adopt online and phone services, especially when complex personal tax issues are under discussion. Recent immigrants, the poor, the elderly and the disabled will all be made more vulnerable by the removal of these services. Chas Roy-Chowdhury, head of taxation at the Association of Chartered Certified Accountants, has warned that this action is being carried out too rapidly and without due consideration.

The Treasury has claimed, through statements to the media and in written answers here, that it is not closing down these centres, but the voluntary exits that are being offered surely amount to a de facto closure. These exit offers are a clear statement of intent, and the closure of the sites, which the Treasury has seemingly made inevitable, will almost certainly increase the pressure on staff to accept the terms on offer. I am deeply concerned about this tactic of offering exit packages before proper, full consultations and impact assessments have been carried out on the closures. It is deeply cynical to hang this uncertainty over the heads of the staff at the same time as offering a redundancy package.

I would therefore like the Minister to clarify the terms on which these exits are being carried out. I would also like clarification on the future of the Newry centre, which dealt with 500,000 queries and cases over the past year. Such clarification will include a time scale for the future strategy for staffing and operations in Northern Ireland. The Minister needs to address why there has been no equality impact assessment, as required under section 75 of the Northern Ireland Act 1998 and as produced for the initial proposal in 1998. Why has there been no consultation with staff, unions or, apparently, the Northern Ireland Executive? Did the First Minister and Deputy First Minister in Northern Ireland make any representations as far back as March or April, when there were some intimations that this might happen? Have they received a response to such representations?

In similar circumstances in the past, the Treasury has sought ministerial approval from the Northern Ireland Executive, as well as a full equality impact assessment and stakeholder consultation. This new approach of offering voluntary exits before this process has begun is deeply worrying, particularly given the devastating impact this closure could have on the local community and economy. There are very real equality issues relating to the closure of this centre, as it is mostly the lower paid, disabled and part-time staff and women who will be most vulnerable and will find it the hardest to get new work; a higher proportion of women will be affected. I also have to point out that the three centres being closed are all in predominantly nationalist constituencies, which could bring its own equality implications.

Before following through with these measures in Northern Ireland, I would also be grateful if the Minister could include more information on the pilot study carried out in the north of England on the introduction of the reformed service. Critical questions are outstanding on the capacity of non-face-to-face and reduced personal tax services to deal with the range of queries that these centres deal with daily. How long will people have to wait on hold to have their inquiry heard? How many cases took more than one call to resolve? How many required a subsequent face-to-face meeting? What was the experience of people and businesses using the new system, and how much will it cost them? There is a clear onus on the Treasury to provide this information before coming to any decision on removing the existing centres. Instead we get the impression of a Department that has made its decision and will find the appropriate reasons from there.

More broadly, we know that tax evasion and avoidance cost the public purse an astronomical amount every year, and that is surely only likely to rise with the closure of local compliance centres. With tax evasion and avoidance costing our economy more than £100 billion a year, HMRC should be expanding rather than cutting offices and staff. Surely the Treasury should be looking at how local tax centres can be adequately resourced and given the scope to take on some of these functions. Indeed, initially we were led to believe the Newry centre would be retained and would assume further responsibility for some cross-border issues, including compliance and tax co-operation with Irish authorities—where better to locate a cross-border taxation co-operation centre than Newry in the context of the development of north-south business links? I am disappointed that that no longer seems to be the case. I would like the Minster to explain what consideration he has given to this. Will he take a more constructive approach?

This Government never tire of telling us of their desire to rebuild and rebalance the economy in Northern Ireland. The message sent out by the decision to remove jobs from the Newry HMRC centre sharply contradicts that, as there are simply not jobs available for these people to move into. Instead, this decision will remove money from the local economy, hitting not just those families directly involved, but businesses across the whole area. I ask the Minister, who has been generous with his time on previous occasions, to hold further meetings with local politicians, the Public and Commercial Services Union and representatives in Newry to look at a constructive solution. I am sure that my hon. Friend the Member for Foyle would join us at such a meeting to discuss Derry. There is an urgent need for the Treasury to review this decision and make a full assessment of the impact of it on the local economy and community.

I am absolutely certain that a viable, economically sound centre can be retained that protects local jobs, perhaps through a centre that also considers aspects related to cross-border tax issues and wider anti tax avoidance and evasion measures. What is absolutely not acceptable is the degree of uncertainty that has been created while staff are being offered exit deals.