Treasury stalls over checking powers for NAO

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A response to a Public Accounts Committee report, demanding access for the comptroller and auditor general, said the government ‘is very conscious of the costs which employers incur in meeting their legal and regulatory obligations’.

The Inland Revenue said it was exploring with the NAO the issues that arise.

It said it ‘noted’ the committee’s complaint about ‘the inappropriateness of expecting the C&AG, in auditing Inland Revenue arrangements for the administration of tax credits, to rely exclusively on the department’s own checks on employers’ records without any facility to validate these checks by inspections of its own’.

The response said checks on the annual returns of PAYE and national insurance contributions for all employers who received funding to cover tax credit payments had not revealed any significant problems.

The Treasury Minute claimed a large number of discrepancies between tax credits authorised for payment and the amounts shown on their returns did not indicate errors but arose because of errors completing forms and departmental errors processing the data.

The PAC demanded action to allow direct reconciliation – which theTreasury said would not be possible.

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