Capgemini faces uphill struggle in tax merger

Officials from the Revenue have spent the last six months working alongside consultants from Capgemini, and incumbent suppliers EDS and Accenture, to ensure a smooth transition of the £3bn contract. But the recent fiasco with the tax credits system will be fresh in the minds of many taxpayers, and concerns that a similar situation could arise from the switch will be hard to dispel.

‘From a taxpayer’s point of view, people will be worried that there will be a repeat of what happened with tax credits,’ said Chas Roy-Chowdhury, head of tax at ACCA. ‘Capgemini needs to be extra vigilant over the next few months, especially with the 31 July self-assessment deadline approaching, that figures don’t go missing or there are miscalculations.’

But the Public and Commercial Services Union, which represents Revenue staff, seems confident that the problems blighting the Revenue during the tax credits fiasco will not be repeated.

‘We haven’t been made aware of any concerns over the switch,’ said a PCS spokesman. ‘It’s been quiet so far, which suggests things have been going quite smoothly.’

With the Customs/Revenue merger on the horizon, it is essential to guarantee continuity of service and minimise disruption, according to Ian Pretty, head of policy and strategy at the Revenue’s Aspire unit.

‘The merger with Customs means that using IT to deliver business transformation is more important than ever. We need to make sure we’re up and running as soon as possible,’ he said.

Like all government departments, the new HM Revenue & Customs is charged with making 2.5% efficiency savings each year to 2008. Achieving this will mean using IT to drive down costs while increasing the amount of revenue collected.

Former mmO2 chairman David Varney has been handed the task of merging the two departments. The appointment of a chief information officer is expected soon.

Capgemini takes charge of 73,000 desktops, 200 systems, 20 ICL mainframes, and 177 IBM and HP Unix servers. The NIRS2 national insurance system will continue to be run by Accenture until early next year, at which time it is expected to become part of the Aspire contract.

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