Taxman defends debt retrieval priorities

The CEO of HM Revenue & Customs has admitted that collecting tax debts of less than £10,000 is not a top priority for the taxman.

Addressing a recent Treasury Committee meeting on the government’s operational efficiency programme, Leslie Strathie conceded that while HMRC ‘doesn’t ever give up on debt’, smaller sums were not a primary concern.

‘In terms of debt management, our priority is [retrieving] debts of more than £10,000,’ she said.

The claims surfaced when the Public and Commercial Services union (PCS), which represents senior HMRC staff, aired concerns over whether a series of redundancies was impacting on the department’s capacity to retrieve the outstanding £25.8bn tax debt thought to exist.

Strathie said the staff losses had resulted in a revision of debt collection and that staff are now being redeployed into debt management.

Some estimates indicate the number of tax collectors within HMRC has dropped by 500 in the past year alone.

According to Peter Lockhart, senior national officer of the PCS, the 18,000 staff shed by HMRC since 2004 as part of an efficiency programme has meant the department has ‘not been able to focus on debts of less than £10,000’.

He said an additional 7,000 staff cuts planned over the next two years will further hinder debt collection.

‘Whether there’s a direct correlation between debt collection priority and staff cuts seems to be counter intuitive when there’s plans to cut more,’ he said