HM Revenue and Customs

Mark Durkan Excerpts

Wednesday 2nd March 2011 Commons Chamber

[Mark Durkan (Foyle) (SDLP)]

I am pleased to follow the hon. Member for Hereford and South Herefordshire (Jesse Norman), who made some salient points, reflecting the insight that he has secured as a member of the Treasury Committee. I pay tribute to him and his colleagues on that Committee for the work they have done, which has helped to inform this debate, as have the many representations that we are all making.

I wish to highlight a couple of dimensions relating to HMRC’s performance and organisational structure as they particularly affect my constituency and my part of Northern Ireland. Before I do so, I wish to endorse a point made by other hon. Members by saying that I am not making these complaints to target or criticise HMRC staff, who are dealing with huge demands on them. They are trying to cope with a system that has been changed around them, and has been made much more inadequate and much more confusing for them. The system causes stress and anxiety to them, as well as to the many public customers with whom they are dealing.

For staff, the situation has been a bit like driving at night with people coming at them at full beam and as soon as they recover from one at full beam, someone else comes along. Changes have been made in the organisational structure, then in the management and then, as the hon. Member for Luton North (Kelvin Hopkins) said, in the staff work load. They have, probably rightly, had to deal with matters such as the minimum wage; child benefit issues have been absorbed on to the tax side, which has meant that issues have arisen for staff in Northern Ireland; and then they have had to deal with the whole issue of tax credits.

I particularly wish to discuss tax credits and the impact on Northern Ireland and, in particular, on my border constituency. Many people live on one side of the border and work on the other. No matter whether they live in the Irish Republic and work in Northern Ireland or vice versa, their circumstances may mean that they have to deal with the tax office for tax credits and, indeed, for child benefit. Under European Union rules, child benefit is paid according to where someone is employed, not according to where they or the child lives—it is a bizarre rule, but it is there and it adds to the complications. Rather than have tax credits in Northern Ireland administered in Northern Ireland, all that administrative work was taken over to England, perhaps for specialisation.

Included in that work were the issues relating to cross-border tax credits. Every case of every cross-border worker is treated as complex and goes to the complex cases unit in Washington. Other hon. Members have mentioned the difficulty of getting in touch with HMRC, but these people, be they in Donegal, Derry or other parts of Northern Ireland, have real difficulty getting in touch. When they manage to do so, or when their accountants or their employers’ people get in touch, they are told things such as, “Northern Ireland is not in the EU, so what are you talking to us about?” They are not even being told that Northern Ireland is not in the UK; they are being told that Northern Ireland is not in the EU.

These people also have to deal with the relevant officials of the Irish Republic, and the relevant department there is centralised in Letterkenny, only 20 miles from my house and from a tax office in Derry. Rather than all the liaison taking place between officials who are 20 miles apart and who can meet, the cases are dealt with on a completely remote basis, with an office in Letterkenny in the Irish Republic and an office in Washington in England. Can things be exchanged over the internet? No, they cannot, because data protection rules say that things have to be transmitted in documentary form, and letters get mis-sent. Letters that contain people’s details and that are meant to go to the Irish Republic end up going in envelopes that are fit only for UK delivery and so do not get delivered for months. Letters that are going to constituents in Northern Ireland, or to others in the Irish Republic who come to me, end up going completely astray too. There is a simple answer to that—make sure that if cross-border cases are not processed in Northern Ireland, there should at least be a liaison office or front office in Derry, in Northern Ireland, that people can go to where someone deals with their case and they are not left crying and in distress, which is how many people come to me when they have been referred by accountants who will no longer touch tax credit cases involving cross-border workers. Employers are very distressed for their workers as well, but there is a simple answer.