Written evidence submitted by Geoff Bantock


  1. I retired in 2011 after 40 years’ work mainly on Inland Revenue/HMRC enforcement, a lot of time on people in poverty with no assets, plenty of debts and minimal income.
  2. My interest in tackling fraud and overpayments in HMRC dates back to 2007 when HMRC had to try and recover New Tax Credits (NTC) overpayments which were almost impossible to collect unless the overpayment could be recovered against future entitlement of NTC   The PAC reported on 28 January 2008 the dire performance of HMRC on tax credits.  I was extremely embarrassed and angry that HMRC had designed and delivered the annular system of tax credits which had resulted in citizens of our country owing about £4.2 billion of NTC debt.  Some 2 million of our poorest families then owed on average about £2,000 each.

  1. These NTC overpayments and similar overpayments in the DWP led me to design my Unified Tax System back in 2007 as a means of addressing this.
  2. If the Senior Civil Service posts churn after about 3 years and ministers in power. somewhat less than that, where is the technical nous going to come from to be able affect the change you seek to counter fraud? This lack of technical knowledge is still the issue that the Fulton report flagged back in 1967 but then there was little in the way of IT services so change could be affected much more quickly than it is possible now, when any major new IT system will require two years to implement and may be obsolescent when finally delivered.
  3. What has changed since 1990 is this massive increase of IT in HMRC. It was not until 1990 that a VDU arrived on my desk and the first computer system arriving - BROCS (Business Review of the Collection Service). After 14 days work using it, I wrote a report tearing it to pieces as it did not deliver what it set out to do. This was the start of my 30-year journey challenging HMRC IT systems which lead to so much waste and inefficiency. What I noticed after the first major computer systems arrived in the network was that senior managers no longer knew the business at the sharp end.  The position deteriorated further when the Inland Revenue transferred 1,900 of the 2,250 staff in its Information Technology Office to EDS in two stages in 1994 and 1996. You may recall that that Self-Assessment was originally referred to as Simplified Assessing 30 years ago but the name had to be changed very quickly as it was not simple.
  4. When I started in Inland Revenue as a Collector of Taxes in 1973, my official instructions were 15 cm thick. When in 1988, we have a visit from Mckinsey and Company consultants to improve to improve efficiency, I piled all my instructions in front of me, which were now 60cm thick and asked the consultants how tall they would be in another 15 years. They jokingly suggested they would then fill my office! But as all instructions are now online, it is not easy to see the total volume of instructions, but they will be massive. I suspect that all Government departments will have had a similar journey to Inland Revenue/HMRC
  5. I note that “in June 2022 £42 billion was owed to HMRC in tax debt, much more than before the pandemic.
  6. Regarding the 26th PAC report on DWP I was also disappointed to read “Levels of fraud and error in benefit expenditure are unacceptably high. The Department for Work & Pensions overpaid an eye-watering £8.6 billion in 2021–22, of which £6.5 billion was due to fraud.
  7. Increasing council tax debt levels will also be impacting. I read in a Citizens Advice report in May 2020 “  Councils have reported an increase of £500 million in council tax arrears in the last three months, suggesting at least 1.3 million households have fallen behind on the bill during that time.” I would anticipate that the Council tax levels will have risen from the total of £4.4billion in May 2020.
  8. I suggest that it is not wise having three organisations DWP, HMRC and local councils trying to collect debt from individuals. There should just be one organisation recovering Government debt from individuals. 
  9. Debt recovery officers and fraud investigators in DWP, HMRC and local authorities all seek the answer to this question. Is the customer’s wealth and lifestyle in line with their income, expenditure, and assets they have declared?
  10. As a debt recovery officer, I asked myself these two questions.

If I bankrupt an individual what would my cash yield, be?

If I took an individual to court or tried to code the debt in or reduce their benefit to leave their income above the absolute level of poverty, what would my cash yield be?

For a lot of cases I dealt with, the answers to these questions were nil.

  1. I suspect a lot of the debts in HMRC, DWP and local councils will have to be written off sooner or later.
  2. I believe that tax and welfare need to be designed round these two questions:

How can I make a claim to increase the money I need to live on above the absolute level of poverty in the UK (or perhaps 2% above this to allow for inflation in a normal year (the Government will need to determine that absolute level of poverty)?'   

How can I report my circumstances have changed?           

  1. To reduce individual fraud, I believe that we need identity cards which can use either the National Insurance or NHS numbers with such up to date security as there is. To get treatment with NHS, claim welfare, open a bank account, rent or buy property or commence employment you would need an identity card. If these measures are implemented and enforced, I believe these will not only reduce fraud but also deter illegal immigrants.
  2. People in poverty do budget and often down to the last penny and they need certainty in their income from the Government. 
  3. If the Government continues to pay less than the absolute level of poverty in the UK, then there will be continuing need of food banks and hardship funds which is demeaning to both the individual and the Government.
  4. I believe there at would have reduced fraud in the bounce back loan application scheme if answers to these additional questions had been asked. Your Vat number and amount of VAT paid in last 12 months. Your PAYE reference number and amount of PAYE paid in last 12 months. Your Corporation Tax reference and the amount of Corporation Tax paid in last 12 months. If no tax shown as paid in last 12 months, would I have paid out £50k?  No.  Would I have checked all the reference numbers on HMRC systems?   No but I would have checked some. I suspect the real reason behind some £29 billion of fraud in Government is caused by silo management in Whitehall combined with a lack of common sense and technical nous in senior mandarins. In education, I feel, we need students to be able to think systems through, think creatively, think culturally (get on the same mindset as fraudsters) and think critically rather than the current groupthink.  Perhaps the best way to solve this is to mesh policy, design, and operations much more closely which should ensure delivery works better - perhaps the ministers' jobs in Cabinet might have to be meshed to mirror what might be required to be meshed between departments so innovation is enhanced, which is essential to reverse the coming Economic Downturn. caused by excessive Government debt and policy decisions.
  5. All Government IT systems for companies, I feel, must show the Company registration number. If grants and loans are being paid out they must be proper companies that are paying their liabilities. The register of directors for companies should show which directors have a valid UK identity card, Those companies with no UK director with a valid identity card should be red flagged for closer attention.
  6. Operation delivery needs should be driving policy and new IT systems. Perhaps Cloud computing technology is the way forward as it gives users access to storage, files, software, and servers through their internet-connected devices: computers, smartphones, tablets, and wearables. Cloud computing providers store and process data in a location that's separate from end users. Information on old legacy systems can then be uploaded.
  7. It is also worth summing up what the Government or any other large company must do when they are facing financial difficulty. They have 3 choices or a combination of them.: - 

21.1  Get an injection of capital - for Government - selling gilts or bonds or any other assets i.e. selling green belt as development land rates (i.e my concept of say 30 new Eco towns providing say a million new homes and new mass electric transit system -To stop bed blocking in hospitals, I feel,  we need to build large villages of extra care beds including convalescent hospital beds funded by NHS ( say two or three thousand) plus a large number of social housing units for the key workers (say 15,000) and say a mix of private housing (say 15,000) so we will then then have a new town very close to a large town or city with proper community assets like childcare, schools, doctors and shops, and where residents are not so dependent on the motor car. This should reduce rents and result in less housing benefit being claimed with less fraud.

 This could be built on a 1,000-hectare site on green belt land, but immediately converting it to development land. The profit to fund electric mass transit systems to the linked town or city. In a vicious recession, we must be creative in the way we raise finance)

    For companies - injection of cash from shareholders - selling of assets - injection of cash from Government i.e Covid loans or Energy costs payments

21.2  Increase turnover - For Government collecting more tax - decreasing of Income Tax to 40% will I believe have resulted in more Income tax being collected due to less tax being lost through evasion or avoidance( this was the case in 1988, when Nigel Lawson cut the top rate from 60 per cent to 40 per cent).. Raising Corporation Tax leaves companies having less capital and may not result in much more Corporation tax being collected (both these two suggestions might not be politically acceptable in the short term!) .  For companies - it is very difficult to increase turnover in a recession when people have less disposable income to spend on goods or services. Having a closer relationship with the EU would I believe increase turnover for companies and increase GDP and taxes paid  - Brexit has not been beneficial for business or HMRC.


21.3  Cut costs - For Government - less staff with more simplified Government i.e. my Unified Tax and Welfare system above would cut administration and fraud 

             For companies - less staff with pay cuts as happened in the 2008 recession.


  1. There is a fourth choice if the above is not right - insolvency as the Government defaults on debt repayments.


  1. We certainly need to address the fallout to business from Brexit and address the causes behind failing childcare and the need for foodbanks and the huge pressures on the NHS and social care.


  1. There is certainly hope at this springtime the start of the New Year. Both to raise cash for investment and address inequality with some fresh ideas.


  1. I believe the Government must change their strategy to help accomplish this.


May 2023