Harra tells MPs HMRC stunned by ‘strength of feeling’ on helpline closures

Harra tells MPs HMRC stunned by ‘strength of feeling’ on helpline closures

Apr 30, 2024

The head of HMRC has told MPs that the ferocity of criticism over its decision to shut helplines with virtually no notice was unexpected and the ‘strategy was being rolled out too fast’

Probed by MPs at the Treasury Committee over the fallout from the proposed closure of phone helplines, HMRC chief executive Jim Harra said: ‘There was a strength of feeling from stakeholders that we did not expect. Our strategy is still digital first but we are not proceeding with the changes announced on 19 March. We will engage with stakeholders – we need to go through all the concerns that stakeholders had.’

Committee chair Harriet Baldwin asked whether the closure was an operational decision, but Harra rejected this, saying: ‘No, that was not the case, HMRC decided it was a good idea to do this. That was shared with ministers.’

Clearly the level of outrage about the decision had shaken HMRC, with Harra stressing to MPs that the tax office had done plenty of internal research before taking the decision.

He added that the ‘immediate reaction from tax professional bodies that despite trials we were moving too fast and they did not have reassurance that we had the services online that people needed.’

Harra added that HMRC ‘had talked to tax professionals, frankly they would prefer us not to make these changes and to be resourced to do things as we have always done’.

However, when pressed by Baldwin on whether the Chancellor and PM intervened to force a reversal of the decision, Harra said: ‘Ministers certainly expressed their concern about the reaction and genuine concern about how this would work.’

‘Having heard stakeholder reaction, ministers want more assurance that we can successfully implement the digital first service.’

Due to the reversal on the helpline closures, HMRC faces a budgetary and resources dilemma as it had clearly reallocated funds to other areas of the organisation.

With no plans to close helplines in the immediate future, Harra said: ‘Given that we are not going ahead with these closures, we need to deploy more helpline resources.

‘We do not have the funding to do this but we are in discussion with ministers about our plans to produce the best level of service that we can after not going ahead with the decision of 19 March.

‘The response will have to be that we deploy extra resources on our phonelines and whether that is through additional funding or reprioritising other services.’

When asked how HMRC would be moving forward, Harra said: ‘We will be implementing this strategy on a slower track and will be more reliant on marketing our services and encouraging customers to try online first.

‘We will still be able to make progress but not at the rate we would need based on the current resources and current forecast.

‘In the short term we are in for a very difficult first quarter – I would hope that going into the second quarter that we will be able to make improvements as long as pushing digital first strategy at all opportunities, but if the solution in the short term is to deploy more resources it takes time to recruit and train them and deploy them effectively.’

When asked what could be done to provide more bespoke online services, Harra retorted: ‘I can’t design a concierge service for 45m taxpayers.’

MPs were concerned about the helpline closures and lack of notice for taxpayers.

Harra said: ‘I was disappointed that despite the work we had done the previous year there was so much concern that we would not be able to provide the services.

‘We did not give enough time when we published the evaluation, on the same day we announced the decision to close the service. We need to engage more carefully with stakeholders.

‘We need to reflect on the pace that we move.

‘I fully believe in our strategy and I want us to continue to implementing the strategy as fast we can. I am very disappointed that we haven’t been able to take this modernising step.’

He added that HMRC should have ‘taken more time to go through the evaluation of last year’s trial and spent more time explaining how people would be supported’.

But in a telling comment, Harra said: ‘For some of our stakeholders, modernisation of HMRC is not in their interests.’

Regardless of the latest decision to halt helpline closures, this is a centrepiece of HMRC’s long-term strategy.

‘I am not saying we will not return to this – we are not just pausing to try again, we have stopped those changes and we are reviewing our strategy,’ Harra said.

‘There are very high wait times on some of our helplines – either we reduce demand or we increase resources.’