Tax Credits System Still Fraught with Errors

May 25, 2007 2:57 PM

Today it has been announced that the amount of overpayment in the tax credits system has fallen. Reuters reports that the total has fallen by £100 million to a total of £1.7 billion this year. This is still a huge amount. A mistake is still made in almost half of tax credit payments. These mistakes mean families facing ruin thanks to overpayments being claimed back after having been spent and the British taxpayer funding criminal gangs that take advantage of the system’s flaws


With these huge costs to ongoing mistakes focussing attention on the problem some improvement was to be expected. What is remarkable is how slowly things are getting better. At this rate it will take 27 years, assuming that the same rate of improvement can be maintained, to create an error free system. This implies that it will take over a decade even to halve the number of errors.


We’ve already wasted £1.9 billion of taxpayers’ money in written off overpayments. Improvement at this pace just isn’t good enough.

Today it has been announced that the amount of overpayment in the tax credits system has fallen. Reuters reports that the total has fallen by £100 million to a total of £1.7 billion this year. This is still a huge amount. A mistake is still made in almost half of tax credit payments. These mistakes mean families facing ruin thanks to overpayments being claimed back after having been spent and the British taxpayer funding criminal gangs that take advantage of the system’s flaws


With these huge costs to ongoing mistakes focussing attention on the problem some improvement was to be expected. What is remarkable is how slowly things are getting better. At this rate it will take 27 years, assuming that the same rate of improvement can be maintained, to create an error free system. This implies that it will take over a decade even to halve the number of errors.


We’ve already wasted £1.9 billion of taxpayers’ money in written off overpayments. Improvement at this pace just isn’t good enough.

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