HM Revenue & Customs: Managing variations in workload
15 May 2009
Full report: HM Revenue & Customs: Managing variations in workload
HM Revenue & Customs faces large peaks in its workload but, by introducing different filing deadlines for paper and online Income Tax Self Assessment returns, it has smoothed some of those peaks.
A National Audit Office report today found that, in 2007-08, HMRC received more than a quarter of the 4 million Tax Credit renewals forms in July (the renewal deadline) and it processed half of the 8.2 million Income Tax Self Assessment returns during January to March. At busier times customers experience delays on their correspondence and receive a less responsive service. In the lead up to the Income Tax Self Assessment deadline in January 2008, HMRC answered just two thirds of the 7 million telephone calls made to its contact centres.
By encouraging more customers to file tax returns online and removing the need for some returns, HMRC has smoothed peaks in workload and released resources of £7 million a year. The peak in Tax Credit renewal work has, however, increased as the deadline has been brought forward to reduce overpayments. Using different processing targets throughout the year and giving customers more information about how long their information will take to process during peak periods could help spread work out throughout the year.
During busy periods, HMRC tends to process simpler Income Tax cases, postponing more complex checks and less urgent work. During peak periods, staff productivity is higher, partly reflecting the simpler cases, but HMRC also experiences increased staff sickness absence.
HMRC moves staff within the individual Tax Credit and Income Tax teams to utilise staff time effectively. Although the Tax Credit processing peak coincides with a trough in Income Tax work, HMRC does not move staff between the two areas because of the need to deal with the build up of post and other work from peak periods, limitations in its IT systems and the staff training that would be required. The Department could make greater use of modern employment practices used by other organisations such as part-year permanent contracts.
The experience of HMRC and other organisations is that between 15 per cent and 40 per cent of contact with customers is avoidable. Reducing the number of avoidable calls by 15 per cent could release resources of up to £23 million a year or 11 per cent of its annual spending on contact centres.
"Peaks in the workload of HM Revenue and Customs push up the cost of running the Department and reduce service quality. By changing the deadlines for tax returns and removing the need for some to be filled in, HMRC has already saved £7 million. By expanding take up of online services further, and helping people avoid unnecessary calls to contact centres, HMRC can reduce costs and provide a better, year-round service."
Tim Burr, head of the National Audit Office, 15 May 2009
Notes for Editors
- In 2007-08 HM Revenue & Customs employed 86,000 staff and cost £4.3 billion to run, of which £2.7 billion was on staff. Most staff are on full time permanent contracts although some are on temporary fixed term contracts for up to 11 months. Over a quarter of the Department’s staff are involved in administering Income Tax forms and Tax Credits at a cost of £1.4 billion a year.
- The Department experiences significant variations in processing workload because of statutory deadlines for submitting Income Tax returns (October and January) and Tax Credit renewal claims (July). Its contact centres also experience significant peaks in work from dealing with customer queries about their Income Tax and Tax Credit forms.
- Press notices and reports are available from the date of publication on the NAO website, which is at www.nao.org.uk. Hard copies can be obtained from The Stationery Office on 0845 702 3474.
- The Comptroller and Auditor General, Tim Burr, is the head of the National Audit Office which employs some 850 staff. He and the NAO are totally independent of Government. He certifies the accounts of all Government departments and a wide range of other public sector bodies; and he has statutory authority to report to Parliament on the economy, efficiency and effectiveness with which departments and other bodies have used their resources.