HMRC Closures

Paul Williams Excerpts

Thursday 2nd November 2017 Westminster Hall

[Dr Paul Williams (Stockton South) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Davies. I thank the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East (Stuart C. McDonald) for securing this debate—I hope that I have pronounced his constituency correctly.

In my constituency, 800 people are employed in HMRC offices in George Stephenson House. In neighbouring Middlesbrough, there are more than 100 people employed in HMRC offices. These people have been told that they can keep their jobs on the condition that they travel to Newcastle each day to work; the “Building our Future” programme consolidates HMRC in the regional centre in Newcastle. If anyone from London looks on a map, they will see that Teesside and Tyneside are not too far from each other, but the reality for these 900 people is that their travel time to work in the mornings, during rush hour, will be at least an hour and a half longer, and it will also take them an hour and a half longer to get home in the evenings.

In Teesside, where the average commute is around just 20 minutes, there is no culture of travelling for an hour and half to get to work. Having spoken with most of the people who work in those offices, the overwhelming feeling is that the choice of a job in Newcastle is not really a choice at all. Having to add three hours to their day is incompatible with their family lives. They are not highly paid workers; the average wage is less than the national average wage. There is also a cost impact; they would pay an additional £400 a month for the privilege of having to work in another town, although they have been offered a package to ease that cost for the first couple of years.

The combination of the time and money that this will cost in the long run has led most people to say that, in effect, they will lose their jobs. That is bad for the staff—for their finances and their time—and it is bad for HMRC. These are hundreds of experienced workers who have a track record of being able to collect taxation. As my hon. Friend the Member for Oldham West and Royton (Jim McMahon) said, these people know the local economy. They have relationships there, and they understand where to look for the people who do not pay the minimum wage and the places that might avoid or evade tax. Loss of experience is bad for HMRC, and this is also bad for the local economy. To add to what hon. Members have said, Stockton-on-Tees is a town, and the 800 people who work in George Stephenson House go there each lunchtime and spend about £1.7 million a year in the local economy. To a small town such as Stockton, that is a lot, and there will be knock-on effects of losing that £1.7 million a year.

Those job losses are happening at a time when HMRC is taking on 5,000 extra staff, according to reports—presumably not in small towns such as Stockton—to cope with Brexit, rather than collect taxes. “Building our Future” is intended to deliver a better service for taxpayers; I understand that. I understand the need to digitalise and reduce phone calls and paper. We have to allow HMRC to make changes, but we also have to consider people and the unintended consequences of the changes.

As far as I can see, the only successful reduction that has occurred as part of the programme is a bit of a reduction in staff numbers. Service quality has deteriorated. Hon. Members will all have constituents talking to them about the amount of time that they have to wait on the telephone to get through to HMRC. In 2005, it was an average of 15 minutes, but in October 2015 it took people an average of 47 minutes to get through. HMRC has responded by hiring more call handlers on short-term contracts, but because those people have so little experience, I am told that the people with more experience spend a lot of their time supporting the people on temporary contracts, and overall that puts an already overstretched workforce under more pressure. Quality is absolutely central to the taxpayer, but it is also really important to the people who work at HMRC; they take real pride in their work. Sadly, 70% of HMRC workers have said that the changes have had a negative impact.

There are falling standards and falling morale, all at a time when there are billions of pounds of uncollected taxes.

Different people have different estimates; some say that £37 billion of taxes are avoided or evaded every year, and some even say that it may be up to £120 billion. We can ill afford to lose people, such as the experienced 800 workers in Stockton and 900 workers across Teesside, who have expertise and a track record in helping us to collect the taxes that we need to run all our services.

Looking up from London, the distance between Teesside and Tyneside may look, on a map, like a short distance for people to travel, but in reality travelling for three hours a day means that they are either not there to take their children to school or not home from work in time to read their children a bedtime story before they go to bed. Will the Minister pause and reconsider whether this change is really necessary, and really in the best interests of HMRC and the people who work there?

--- Later in debate ---

[Dr Williams]

We do not doubt that an assessment has been made. We simply want to see for ourselves that objective assessment. Perhaps we can learn what our talents need to look like, so that we can meet future objective criteria.

[Mel Stride]

The hon. Gentleman has asked precisely the same question that the hon. Member for Bootle (Peter Dowd) asked, so I have already dealt with that.

--- Later in debate ---

[Mel Stride]

That is the third time that basic question has been asked, and I am not going to give a different answer from the one I gave first. Perhaps I could make a little progress.

HMRC will move to new regional centres, which will serve each and every region and nation in the United Kingdom. The first of them opened in Croydon in July, and has been designed specifically to help staff work together and change the way HMRC operates. The building is modern and is located in the heart of the community; it is a modern, environmentally friendly workplace. The other centres will open over the coming four years and have been designed with the future needs of HMRC and the taxpayer in mind. In addition, HMRC will keep open a limited number of transitional sites, as I have suggested, for several years, to help retain key staff during the period of transition, as well as five specialist sites for work that cannot be done elsewhere, such as the site at Dover.

The locations of the regional centres were selected with a number of criteria in mind, such as cost and wider facilities for HMRC staff. They ensure that HMRC has a presence in every region of the UK. The programme will, as I have indicated, deliver savings for the taxpayer of about £300 million up to 2025, plus annual cash savings rising to more than £90 million by 2028. HMRC has structured support in place to help its staff during the move. For example, it will support staff in moving, by helping with additional travel costs for up to five years after the move. It is working with other Departments to identify opportunities for those unable to move to regional centres. The Department has already supported about 100 people into new roles in 2016-17 and 2017-18. However, we need to remember that the vast majority of HMRC employees are within reasonable daily travel distance from a regional centre, specialist site or transitional site. The locations of regional centres were chosen with the whereabouts of existing staff in mind.

[Dr Paul Williams]

The Minister said that the vast majority of people who will transfer are within reasonable distance of one of the new sites. Is there a definition of a reasonable distance, in terms of travel time?

[Mel Stride]

I shall get back to the hon. Gentleman on precisely what that means. I suspect it is a travel-to-work time, but it will probably vary depending on location.