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The HMRC Estate inquiry


By reducing the number of its offices and moving to a regional centre model HM Revenue & Customs (HMRC) hopes to significantly reduce its running costs and modernise the way it works. However, in a report published by the National Audit Office (NAO), it is considered that HMRC recognised that its original plan was unrealistic and is considering how it can adjust the scope and timing of the programme to reduce the cost and delivery risk. Any changes will need to be carefully managed to avoid diminishing the long term value of the strategy.

HMRC is undergoing a major transformation programme to redesign and significantly reduce its estate by 2020–21. It is moving from a widely dispersed estate of 170 offices to 13 regional centres supplemented by four specialist sites and a headquarters in central London. This programme is part of a wider civil service agenda to move to shared government 'hubs'. HMRC believes that moving to regional centres will provide the flexibility to modernise and transform the way it works to a primarily digital service. It has more space than it needs and much of it is in poor condition, which it considers reduces morale and productivity. HMRC's plans for regional centres are therefore integral to its strategic aims to increase tax revenue and to transform the service it provides to its customers.

National Audit Office report

The report finds that HMRC has reduced the size of its estate by over a quarter since 2011, saving £102 million (30%) in its annual running costs. However, the scale of the changes it could make has been limited by the terms of its long-running contract with Mapeley STEPS Contractor Ltd, which expires in 2021 and covers around two-thirds of HMRC's estate. In its business case for moving to regional centres, HMRC estimated that it would continue to make savings over the next eight years as it leaves most of its existing buildings.

Concentrix update

The Committee will also be using this meeting to discuss the report of the National Audit Office's factual investigation looking at the performance of Synnex-Concentrix UK Ltd (a business services provider) in supporting HMRC's anti-fraud and error interventions.

HMRC contracted with Concentrix in 2014 to provide it with additional capacity. In the end, the contract did not work as HMRC intended and, in November 2016 HMRC and Concentrix agreed to terminate it and a number of Concentrix staff transferred over to HMRC.

Reports, special reports and government responses

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53rd Report - The HMRC Estate
Inquiry The HMRC Estate inquiry
HC 891

Oral evidence transcripts

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25 January 2017
Inquiry The HMRC Estate inquiry
Witnesses Sherin Aminosshe, Executive Director, Government Property Unit, and Head of Government Property Profession, Justin Holliday, Chief Finance Officer, HMRC, and Jon Thompson, Chief Executive and Permanent Secretary, HMRC
Oral Evidence
Stuart McDonald MP (HME0005)
Stuart McDonald MP (HME0006)
Government Property Unit (HME0008)

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