Wednesday 22 June saw something of a success for Citizens Advice and the Ombudsman (and all other campaigners and advisers) in highlighting the important issue of tax credits maladministration, particularly in the areas of overpayments and debt recovery. The PM issued a rare apology to all those caused hardship and the Paymaster General, Dawn Primarolo gave assurances of positive change.

Don't let us get complacent about this. We need to keep up the pressure and ensure that maladminstration of tax credits stays at the top of the agenda. We need to be sure that we continue to highlighting bad practice and harship in tax credits, and bring cases to the attention MP's, the Ombudsman and the Adjudicators Office

For those, like myself, who find themselves dealing with HMRC officials who think they head up the department, here's some relevant sections of the Paymaster General's comments about overpayments and disputes from Hansard:

Tax Credits

Hansard 22/06/05 Col.801

The Paymaster General (Dawn Primarolo): ………..
……..The Department is improving the helpline so that families receiving tax credits can have all their queries dealt with in one go and all their changes processed with one call to the helpline. Where there is a dispute, I have asked HMRC to consider suspending recovery of excess payments until the dispute is resolved. Where there is hardship, I have asked it to ensure that the additional payments in the system are made.

Col.805
The hon. Gentleman asked about writing off official error. He knows full well that in cases in which either an administrative or information technology error has been made by the Inland Revenue and it would be unreasonable to assume that the claimants did not realise that a payment had been made in error, that money has been written off. In my statement on 26 May, I made it clear that we needed to review the procedure and determine not only whether to suspend recovery until a dispute has been resolved, but how we communicate with claimants so that the Department can ensure that they know exactly what their entitlements are.

Col.808
in circumstances where there is a dispute or where hardship would be caused, I have said repeatedly that I want HMRC to suspend recovery while the dispute is settled. I have asked it to adopt that position, and to ensure that those in hardship are paid the additional payments that are already available in the system, and that they are made aware of the fact that those payments are available to them.