The National Audit Office have revealed that HMRC are re-evaluating plans to shut 170 offices, replacing them with 13 regional centres. However, the plans reveal that the cost will be £600m than first estimated.
HMRC “has yet to demonstrate how in practice the regional centres will help its employees provide a better service” and tackle tax evasion and avoidance, it added.
The NAO said HMRC had underestimated the scale of the disruption involved, with up to 5,000 staff expected to leave as a result of the proposed move, while it had been unable to find suitable properties in some of its chosen locations.
“During the transition to regional centres, HMRC must ensure that its service to taxpayers and its ability to collect tax revenue are not impaired,” the NAO said.
The NAO said HMRC was now reconsidering the scope and timing of the move to reduce the costs and the risks of disruption. Some of the options include reassessing when to introduce flexible working practices, reconsidering the size and location of the regional centres and changing the timetable for opening them.
Chair of the Public Accounts Committee, Meg Hillier MP, said: “The government’s early over optimism is once again going to increase costs to taxpayers, by £594m over 10 years, and impact their own staffs’ livelihoods.
“As HMRC decides what actions to take in the short window it has before the Mapeley contracts expire, I urge it to heed lessons of the past before signing more long-term lease agreements, or letting experienced people go.”
Lib Dem economics spokeswoman, Lady Kramer, said: “How can the public have confidence in our tax system when the organisation charged with bringing in money it so utterly reckless with how it spends it?”
Mark Serwotka, the general secretary of the PCS union, said it was now imperative that HMRC halted these plans and allowed MPs and the public to have their say.
“Cutting thousands of HMRC staff in recent years has hit the services it provides to the public, yet the department and this Tory government are ploughing ahead with poorly thought through plans that would mean thousands more job cuts,” he said.
An HMRC spokesman said: “Our 13 new regional centres are an essential part of our work to modernise HMRC and provide an even better service for our customers, while delivering annual savings to the taxpayer of over £80m from 2025-26.
“It also means modern offices for our staff, with the latest technology, better collaboration between teams, local training and wider career opportunities.”