HMRC telephone delays are down to ‘unnecessary job cuts’, says NAO

Taxpayers spent a staggering four million hours on hold to HM Revenue & Customs (HMRC) in 2015/16 – and experts are putting the delays down to ‘unnecessary job cuts’.

Job cuts at HMRC have been on the rise in recent years, according to the National Audit Office (NAO), which claims that the tax man has scrapped some 10,800 employees since 2010 – over half of whom were dismissed in the 2014/15 tax year.

Defending HMRC’s cuts, Ruth Owen, director general for customer service claimed that at least 55 per cent of MPs left due to “natural wastage”.

Ms Owen added that many employees were kept within HMRC, but deployed to different areas – and that some 2,400 additional staff had been recruited to make up the shortage.

The average caller typically waited up to 47 minutes on hold to HMRC, recent studies have revealed.

The NAO also found that some 4.2 million callers hung up after waiting for an average of 16 minutes each.

Further defending HMRC’s operations, Ms Owen said: “The reason we lost some staff with skills was down to the footprint of our contact centres. Some were also on older contracts, which meant they did not work evenings and weekends, and those are the periods when increasingly our customers want to be able to contact us.”

“A large number of people phone about tax credits and when the next payment is. At bank holidays we put on a message saying ‘if you expect to be paid on a Monday the payment will actually arrive on the Friday’

“We then consider this call as ‘answered’, as they received the information they phoned up for.”

UK jobless rate is the lowest since 2005 and wage growth increases

The unemployment rate in Britain has fallen to its lowest level in more than a decade and the introduction of a National Living Wage has led to a wage growth.

The number of unemployed fell to five per cent in the three months to April, a drop of 20,000 to 1.671 million, and the lowest since October 2005.

According to official figures from the Office for National Statistics earnings for the same period, excluding bonuses, rose by 2.3 per cent year-on-year. This was partly due to the compulsory wage of £7.20 an hour for workers aged 25 and above, which has affected 1.8 million workers.

The rise in both employment and wages was bigger than analysts had expected. Economists in a Reuters poll predicted the unemployment rate to be steady at 5.1 per cent, and had predicted a wage growth of 1.7 per cent.

Chris Williamson, chief economist at analysts Markit, said the figures were good news but warned that employers’ demand for staff had “cooled in more recent months” amid worries “a slowing economy” and suggested “the good news should be treated with some caution.”

The news does, however, mean that Britain’s employment rate is now at 74.2 per cent, the joint highest since records began in 1971.

Both public and private firms have been hiring staff. Public sector employment rose by 6,000 while private firms have employed more than half a million more people in the past year.

Work and Pensions Secretary Stephen Crabb said: “Secure employment and a decent wage are key to transforming the life chances of people right the way across the country, so I’m delighted to see another strong set of figures this month.

“There are more people in work than ever before and wages are continuing their upward climb, which is great news for hard-working families who have seen a rise in their living standards over the past year.”

James Knightley, of ING Bank, said that if the trend continued it would “help build the case for an interest rate rise early next year”.

The economist added “this should be good news for pay” as employers would be forced to pay more to attract the best staff.