HMRC cost-cutting and service improvement a “huge challenge”

HMRC cost-cutting and service improvement a "huge challenge"

NAO warns that cost-reduction plans and service improvement will prove difficult in tandem for the Taxman

THE TAXMAN faces a mighty challenge in making a £1.6bn reduction in running costs while improving customer services and tax take, warns the National Audit Office.

The cost-cutting schedule has a 2015 target. HM Revenue & Customs has cut £1.4bn since 2005. A further 10,000 staff will also be cut during the period.

While the Taxman has defined clear opportunities for cost-cutting, it has “not yet sufficiently defined” its performance and customer service levels for the next four years.

HMRC has only limited information on the cost of its end-to-end processes and on the cost of servicing different customers groups. It also has a limited understanding of the link between the cost and value of its activities, the NAO found.

There is no allowance for slippage or under-delivery, the NAO noted, with no reserve of proposals on which to draw.

Planned reductions and estimated savings require better testing, for example in its plans to reduce sickness absence.

Amyas Morse, head of the NAO, said: “Reducing running costs by £1.6bn over four years is a big challenge for HMRC.

“It is making progress but there is no contingency in its plans. To achieve value for money, it needs to better define the service it is aiming for, improve its understanding of costs and develop its implementation plan.”

Share

Subscribe to get your daily business insights

Resources & Whitepapers

Why Professional Services Firms Should Ditch Folders and Embrace Metadata

Professional Services Why Professional Services Firms Should Ditch Folders and Embrace Metadata

3y

Why Professional Services Firms Should Ditch Folde...

In the past decade, the professional services industry has transformed significantly. Digital disruptions, increased competition, and changing market ...

View resource
2 Vital keys to Remaining Competitive for Professional Services Firms

2 Vital keys to Remaining Competitive for Professional Services Firms

3y

2 Vital keys to Remaining Competitive for Professi...

In recent months, professional services firms are facing more pressure than ever to deliver value to clients. Often, clients look at the firms own inf...

View resource
Turn Accounts Payable into a value-engine

Accounting Firms Turn Accounts Payable into a value-engine

3y

Turn Accounts Payable into a value-engine

In a world of instant results and automated workloads, the potential for AP to drive insights and transform results is enormous. But, if you’re still ...

View resource
Digital Links: A guide to MTD in 2021

Making Tax Digital Digital Links: A guide to MTD in 2021

3y

Digital Links: A guide to MTD in 2021

The first phase of Making Tax Digital (MTD) saw the requirement for the digital submission of the VAT Return using compliant software. That’s now behi...

View resource