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15 Jul 2011
HMRC CLAIMS that a five-year productivity drive has resulted in £860m in tax yields and £400m in resources savings have been challenegd by the National Audit Office.
A report said that its PaceSetter Programme, aimed at streamlining business operations through new ways or working, could have contributed to a slight improvement in staff engagement and productivity but is "not yet value for money".
It said: "The extent of the efficiency improvements is not clear, however, and some key principles of process improvement are not yet being applied strategically across the entire organisation and embedded into the department's core processes.
"Although work has begun on these issues, after five years we would expect the department's approach to process improvement to be further ahead, more sophisticated and more ambitious in its transformation of the department."
Comptroller and auditor general Amyas Morse said: "PaceSetter is travelling in the right direction but not fast enough."
The report said that a more complete assessment showed costs of "at least" £115m in consultancy, equipment, staff and travel costs compared with HMRC's assessment of £55m.
An employee engagement index gave HMRC a score of just 36 compared with an average of 58 across other government departments. Where PaceSetter was engaged, it varied between 37 and 40.
HMRC it is required to reduce its running costs by 25%, reinvest £900m to bring in additional revenue of £7bn a year and improve customers' experiences by 2016.
The NAO said that the department needs to use the programme to help streamline business operations in a more strategic way with a clear understanding of processes and of what customers require.
An HMRC spokesman said: "In the last five years we estimate that our Pacesetter productivity programme has boosted the tax yield by £860m whilst reducing our costs by £400 million.
"We are now going to build on this by extending Pacesetter across the department, delivering additional tax and savings."
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