|Sir George was batting for his constituents right up to the close of play at Westminster. In a hard-hitting speech, he criticised Inland Revenue for the way they had handled some tax credit cases in his constituency
6 Apr 2005
This is the text of the speech Sir George made in the House:
Sir George Young (North-West Hampshire) (Con): It is a pleasure to follow my hon. Friend the Member for Mid-Worcestershire (Mr. Luff), who has spoken so movingly on behalf of his constituents. I also commend the hon. Member for Caithness, Sutherland and Easter Ross (John Thurso) for his choice of subject and the reasonable and analytical way in which he spoke to it. I want to add a brief footnote to the excellent speeches that have been made.
At the beginning of this Parliament, the single biggest generator of constituency casework was the Child Support Agency. That wooden spoon has now been transferred to the Inland Revenue, for all the reasons that have been mentioned in this debate. There is no disagreement about the principle here; nobody wants to go back to the old days, when people on supplementary benefit or income support received a range of payments, but when they moved into work that life-support system immediately fell away, which created the "Why work?" syndrome. The working families tax credit was introduced before 1997 in order to address that syndrome. However, we now have a fiendishly complicated system, and many of the cases that we have been talking about involve not only the Inland Revenue as it is often firefighting with other agencies—having a dialogue about housing benefits, for example. Therefore, the Inland Revenue tax credit issue is frequently but one of a range of problems that people living in difficult circumstances are trying to confront.
The debate has focused on what happens when things go wrong. I want to refer only to one case. Mrs. P, who lives in Andover, had her payments stopped. She came to see me, I took her case up with the Revenue, and I received a letter saying:
"I . . . understand that Mrs P is concerned that her tax credits for 2004–2005 have stopped."
Of course she was concerned, because in the previous year her annual payments were £11,316! When that income stream falls away, one is concerned. The letter went on to state:
"When claimants have been overpaid, we normally expect them to pay it back."
We then went around the course of whose fault it was, and a letter arrived on 16 March stating:
"We have decided that although the overpayment was due to a mistake on our part it was not reasonable for you to think that your award was correct . . . The award notice asks you to check all the information and contact us if any of the details are wrong. The overpayment will be recovered from you."
Not only has the income stream stopped, but she now apparently owes the Inland Revenue £10,763.17 because of an overpayment due to a mistake on the part of the Inland Revenue. I see that those letters are all printed with "Investor in People" at the bottom. I wonder whether that award will be revisited.
I think that I am right in saying — perhaps my hon. Friend the Member for West Suffolk (Mr. Spring) can confirm this — that my hon. Friend the Member for Havant (Mr. Willetts) said in a speech a few weeks ago that were our great party to be returned in the general election, we would write off overpayments that had been made by the Inland Revenue, save for those cases where there was evidence of fraud. I hope that my hon. Friend is able to confirm that, and that the Minister will then respond to the challenge of matching that commitment as we approach the general election. Clearly, many people have an interest.
In the next Parliament, we need to stand back and look at the financial interface between citizens and state to see whether there is a better way to achieve the principle to which we all subscribe. Can the interface be reduced by raising the tax threshold? Can we do more on the universal benefit front? Can the system be simplified in some way? Is there a better way of addressing the issues when things go wrong that does not involve all the palaver that we have heard about this morning? Clearly, we are not going to address these matters in the remaining stages of this Parliament. However, at the beginning of the next Parliament we all ought to stand back and look at the top-heavy, complex system and ask the basic question: is there a better way to achieve the goals that we all want to achieve?
The Conservatives are committed to better management of tax payers' money: a smaller state - bigger citizens.