DWP in 2022: Record underpayments, record benefit fraud and deleted child benefit records

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Last year I reported that the national audit office had qualified the Department for Work and Pensions accounts for the 34th year running because they were inaccurate and it couldn’t balance the books.

Auditor General threatens to refuse to pass pension accounts next year if DWP carries on like this

But this year the DWP has surpassed itself – it is now the 35th year that the DWP has had its accounts qualified.

Benefits overpaid officially fell a little from the pandemic year – £8.2 billion instead of £8.6 billion- but when you strip out the extra cost of living payments – they are much higher than the pre pandemic year of 2019 -£7.8 billion compared to £4.4 billion – a massive increase.

Most of the fall in the amount DWP overpaid benefits related to fraud in Universal Credit. The amount of Universal Credit that DWP overpaid fell from 14.7% (£5.9 billion) of expenditure in 2021-22 to 12.8% (£5.5 billion) in 2022-23. But again compared to the pre pandemic year of 2019 this was a rise.

DWP estimates that Universal Credit claims started after the COVID-19 peak (March to June 2020) were overpaid by 13.1% in 2022.This remains significantly higher than the 9.4% that it overpaid all Universal Credit claims in 2019-20.

The reduction is mainly due to a fall in the level of self employment claimants and the reintroduction of rules designed to prevent self employed claimants understating their income.

On average 33% of Universal Credit claims were incorrect in 2022-23,equivalent to 1.6 million claims. Most of these claims (24% of all Universal Credit claims) were overpaid.

The report says: “Around 40% of overpaid claims were to people with no entitlement to any payment at all, which is equivalent to 10% of all Universal Credit claims. Some of these were marginal cases where small amounts of undeclared income or claimant circumstances (such as attending hospital) made the whole claim invalid. However, some other claims were overpaid as much as £1,800 per month; some were completely fictional; and some related to serious and organised crime.”

Pensioners lost hundreds of millions of pounds in underpayments

The record underpayments of pensions and benefits topped £3.3 billion. A large number were caused by people claiming Personal Independence Payments who had not updated the DWP about their increased medical needs.

But it was pensioners who were cheated by the DWP into not receiving their full pension entitlements that is worrying the National Audit Office.

The report says: “The level of State Pension underpaid by DWP has been trending upward for six years to 0.6% (£670 million) in 2022-23. Most of these underpayments (£580 million) were a result of official error. DWP believes that part of the increase is due to changes in how it measures State Pension error and that its previous estimates may have been understated. This brings the total fraud and error rate for State Pension, including overpayments, to 0.7%.

“I will keep the gross level of incorrect payments in State Pension under review and may have to include State Pension in my regularity qualification in future years if the estimated rate continues to rise.”

There is £1.2 billion owed to 165,000 married pensioners, widows and those over 80- all caused by official errors in the past. It will take until the end of 2024 before everyone is paid.

And now the DWP has discovered another 210,000 pensioners owed up to £1.5 billion because officials did not record their right to paid national insurance contributions while looking after children

The report says; “These issues affect people (mostly women)who received Child Benefit before 2000 and whose National Insurance record was not updated to reflect periods of HRP (Home Responsibilities Protection) they were entitled to. DWP cannot begin to correct cases until HM Revenue & Customs (HMRC), which administers both National Insurance and Child Benefit records, corrects the National Insurance records and notifies DWP.
“HMRC intends to begin work to identify people who may have missing HRP in autumn 2023 and will write to them to invite them to apply for missing periods of HRP to be added to their National Insurance record.”

However it turns out that HMRC have destroyed many of the people’s records.to meet Data Protection laws so it may not be able to find them.

Then there are 10 million people claiming Universal Credit have not been updated properly – a small proportion of these may have also been underpaid their State Pension. HMRC began correcting records in February 2023 and expects this work to be completed by the end of March 2024.

The report adds; “DWP has still to determine how many people have been underpaid and by how much they were underpaid. Of those missing the Universal Credit National Insurance credits, 137,000 have already reached State Pension age.“

jonathan Mills
peter schofield
neil couling
nick Joicey
katie faringdon
simon McKinnon
amanda reynolds- director service excellence
Debbie Alder

Roll call of this year’s DWP top officials and their bonuses and pensions

Meanwhile the DWP continues to pay out bonuses to senior staff. Peter Schofield, the permanent secretary, did not take a bonus this year and his pension payments were half last year’s at £16,000. His full package is £210,000 a year compared with £240,000 the previous year.

Neil Couling, the change director who is responsible for universal credit, got a £5000 bonus and had a £52,000 deduction in his pension pot, in a year when he presided over record fraud over universal credit.

Debbie Alder, director of people, got a £15,000 bonus, and put £59,000 into her pension pot, giving her a package worth £200,000 this year.

Jonathan Mills, responsible fo the Labour policy at the DWP, left in June with a £5000 bonus. He is now director of energy markets and supply at the Department for Energy Security.

Nick Joicey, director general of finance who earned £80,000 for five months is now chief operating officer and second permanent secretary of Defra. He is also the husband of Rachel Reeves, the shadow chancellor.

Simon McKinnon, director general and chief digital officer, who left in April 2023, Got a final year bonus of £15,000 and £62,000 in his pension pot, taking his final package to £240,000. He was responsible for reorganising the DWP’s system to bring it back in house.

Amanda Reynolds, director of service excellence, also got a £15,000 bonus and £61,000 into her pension pot, taking her package to £240,000 for providing what some claimants and pensioners would claim was hardly a first class service.

Katie Faringdon, director general for disability, health and pensions, got no bonus but had a £175,000 package including £44,000 into her pension. Over the last two years she has put pension benefits worth £131,000 into her personal pension fund. I am sure the millions of pensioners facing delayed pensions and still waiting to be reimbursed for mistakes by officials into their pensions will be pleased for her!

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Half baked and half finished: How courts and tribunals burned through £1 billion on computers to improve access to justice and failed

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Royal Courts of Justice

It is portrayed by HM Courts and Tribunals Service as “our vision for reform to make the justice system more straightforward, accessible and efficient.”

But this £1.3 billion digital court reform programme has been exposed by the National Audit Office and last week by the House of Commons Public Accounts Committee for having failed to meet its objectives. This ambitious programme started in 2016 has been much delayed and only half completed. As MPs commented last week it has ” burned through” over £1 billion of public money and is the on the verge of running out of cash before half the benefits can be realised.

No one would argue that the courts and tribunal system is antiquated and needs reform. One only has to watch judges in the employment tribunal system writing down what claimants and respondents are saying by hand in courts that don’t keep proper records of hearings to realise how antiquated it is.

But once again it looks like that Whitehall has fallen for an expensive simplistic digital solution for a service which is incredibly wide ranging and complex. The aim was to create a common computer platform to serve 44 different aspects of justice from the criminal courts to magistrates courts and from the family and divorce courts to the probate service and the tribunal service.

Timetable five years behind schedule

It also had a timetable to be completed by 2020. Now we will be lucky whether the truncated programme will be up and running by 2025. Also £1.3 billion won’t be enough – there is only £120 million left to spend and that is nowhere enough to meet what is needed. And £22 million was wasted trying to integrate the Crown Prosecution Service into the system which didn’t work.

Also there are promises of big savings by going digital. This is always promised and we will see whether that really happens.

Also plans to have fully digital probate and divorce services had not fully worked. The MPs said:

“HMCTS found that significant proportions of its online divorce and probate cases required manual interventions from staff and in March 2022 HMCTS identified that 55% of divorce cases could not be completed online.”

In addition it appeared that both services discriminated against ethnic minorities.

Both the Bar Council and the Law Society were not impressed. The report says:

The Law Society “explained that there were functionality issues with online portals for family services, such as family public law. These issues led to problems, including instances of solicitors not getting necessary notifications which made the system difficult to use and, in some cases, significantly delayed cases. It told us that it had frequently expressed concerns to HMCTS about the functionality and design of some reformed services.”

System developed in a vacuum – Bar Council

The Bar Council told MPs:” the designers and producers of the common platform appeared to
have a limited understanding of working needs and practices, and “displayed a marked reluctance for the system to be designed in conjunction with, and for the benefit of, professional court users”.

It said it looked like the system had been designed in a vacuum.

As for the general public, it looked like that it was going to be a problem at magistrates courts ,purely because most of the defendants didn’t have any legal representation and therefore might not have proper access to the system to defend themselves.

Meanwhile the project continues so far with the pausing of integrating possession orders, special tribunals except for the Criminal Injuries Compensation Tribunal.

Dame Meg Hillier MP

Dame Meg Hillier MP, Chair of the Committee, said:

“Our courts were already stretched thin before the pandemic, and the backlogs now faced pose a real threat to timely access to justice. These are services crying out for critical reform, but frustratingly HM Courts & Tribunal’s attempts appear in some cases to be actively hindering its own staff’s ability to carry out their jobs. In particular, the roll-out of the Common Platform digital system was a blow upon a bruise for pressured court users.”

Given there are already many issues whether the courts do deliver justice, this rather botched computer programme does not give you much faith in the system.

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Britain is becoming disconnected – 1 million people quit broadband because of the cost of living crisis

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pic credit: Andrew Neel

A report published today from House of Lords savages the government’s failure to tackle digital exclusion when ministers have promised the country will become a world leader in digital technology.

Figures in the Communications Committee report are absolutely astounding.

It says: “1.7 million households have no mobile or broadband internet at home. Up to a million people have cut back or cancelled internet packages in the past year as cost of living challenges bite. Around 2.4 million people are unable to complete a single basic task to get online, such as opening an internet browser. Over 5 million employed adults cannot complete essential digital work tasks. Basic digital skills are set to become the UK’s largest skills gap by 2030″.”

The most disturbing figures came from Citizens Advice which has picked up that people are cancelling or reducing internet packages. This means we are going backwards. The report cites Which? for showing that on top of higher fuel, food, council tax, rail fares. broadband and mobile phone providers are upping their prices year on year by between 14 and 17 per cent.

Paltry 5 per cent of eligible people get a social tariff

There are social tariffs for the poorest on Universal Credit but they don’t seem to be marketed well by the broadband providers. They are taken up by a paltry 5.1 per cent of the people who are entitled to claim them – representing 220,000 of around 4.3 million eligible households. Monthly costs are lower -around £10-£15 rather than £30 or more but not low enough for the poorest who could only pay between £4 and £7 a month. The peers suggest VAT could be abolished on them to help and BT Openreach which has a near monopoly on connecting people could reduce its charges as well.

The breakdown of where the digital excluded are follow a familiar pattern. The largest number are in ” Red Wall” areas – the North East of England and also in Wales and Scotland. Internet connectivity doesn’t help either – there is a double whammy effect in the North East – Darlington and Middlesbrough are cited as having poor internet. The lowest number are in London and the South East. Age and disability is a factor as well. There is a significant drop in those not connected to the internet or having a smartphone for people aged 55 and above. But there are also a small minority of young people and those in their 30s and 40s who are also not fully connected.

Why does all of this matter? According to the report the failure of the government to update its digital inclusion policy since 2014 and its lethargic response to the problem will hit plans both by the Tories and Labour to grow the economy.

Government’s priority ” not credible”

The peers’ findings are savage.

“The Government’s contention that digital exclusion is a priority is not credible. Its flagship digital inclusion strategy is almost a decade old. Formal cross government evaluations seem to have stopped. Working groups have been disbanded. Interventions to help with internet access are too timid. The
Government cannot be expected to solve everything but it can achieve much by showing interest in driving change against clearly defined objectives. We have no confidence that this is happening. Senior political leadership to drive joined up concerted action is sorely needed.”

Liam Halligan, a Daily Telegraph columnist and journalist for GB News, giving evidence put it more vividly:

He said solutions were ““Just not sexy. Ministers like talking about unicorns and AI. They like being photographed with the tech bros in T-shirts and sand shoes, rather than dealing with what is a necessity of life now.“

Baroness Stowell of Beeston: Official Portrait House of Lords

“ Baroness Stowell, Chair of the Communications and Digital Committee said:“

“We have found a distinct lack of leadership in Government to tackle this issue. It is shocking that a digital inclusion strategy has not been produced since 2014 and the Government sees no need for a new one. It is vital we get a grip of this now.

“The cost of living crisis has made access to the internet unaffordable for many. We need urgent action to ensure people aren’t priced offline.”

A spokesman for the Department for Science, Innovation and Technology said:

“We are committed to ensuring that no one is left behind in the digital age. Steps we are taking include putting essential digital skills on an equal footing in the adult education system alongside English and maths.

“To boost access, we have worked closely with Ofcom and the industry to bring a range of social broadband and mobile tariffs, available across 99% of the UK and starting from as low as £10 per month, and our £5 billion Project Gigabit has already resulted in 76% of the UK being covered by gigabit broadband, up from just 6% at the start of 2019.”

Unless something is done quickly the future is bleak. A sizeable minority of people will soon be excluded from society altogether. Already 90 per cent of jobs are only advertised on line, bank branches are closing down and pressing people to open on line accounts. Ticket offices for trains are closing. Some 75 public services are planning to go digital and already some councils will only deal with people on line for applying for blue badges – even though many disabled people have no internet.

And future government policies are going to be based on machine learning information – which will effectively exclude those not on the internet. Cynically that is one good way to deal with the poor and the old – make them disappear so you don’t have to provide anything for them.

But in the end digital exclusion will hit the British economy very badly and we will all suffer. And those boastful and complacent ministers will see their world leading plans turn to ashes.
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Will a DWP £1 billion digital “transformation plan” for health assessments of disabled benefit claimants be a new disaster?

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The National Audit Office last week gave its verdict on plans by the Department for Work and Pensions to digitalise and transform all the health assessments of disabled people claiming benefit and Personal Independence Payments (PIP) by 2029 and raised serious concerns whether it would work..

This is not a minor matter for the disabled. Some 3.9 million working age people claim these benefits and those claiming both PIP and the Employment and Support Allowance have to pass two health assessments. By 2025-6 the number of claimants is estimated to rise to 5.8 million. Every year private contractors assess nearly two million people. There also has been a rise in people claiming ESA as a result of the pension age for women going up from 60 to 66 and for men from 65 to 66.

As usual this report appears to have had little coverage in the national media -despite the millions of people that will be affected.

High risk of delay, cost overruns without achieving benefits

Gareth Davies, the head of the NAO, said:

“While the Programme is ambitious and has the potential to make savings and improve the experience of those being assessed, the scale and complexity of the transformation leaves it at high risk of delay, cost overruns, and of not achieving the intended benefits.”

He called for the department to revise its business plan for the £1 billion scheme and for more transparency so that perhaps even MPs can understand its implications.

At present disabled people have to provide multiple documents and fill in long forms to claim and the system is unpopular. The new system will digitalise the process, cut out duplication but will still depend on private contractors assessing whether people are unfit enough to claim.

Therese Coffey, former DWP secretary of State

Appeals over claiming PIP are unnecessarily high with decisions by the private firms being overturned and there have been cases where people turned down for disabled benefits have died and the DWP under Therese Coffey covered up reports about this. See this report in the Disability News Service.

The transformation is going to take place alongside new five year contracts for three private companies, Capita. US company Maximus, and Australian firm Ingeus worth over £1.6 billion with an IT contract to Atos to provide the computer back up. Nearly all the companies (except Ingeus) have been linked to claimants deaths as an article in Disability News Service reveals.

Limited testing of system using state appointed medical advisers

At the same time there is going to be a limited state provided service in London and Birmingham where the DWP will employ medical assessors directly. The aim according to the NAO report is to ” test and learn ” the new system and pass on the information to the contractors.

The NAO is sceptical whether this twin approach will work in time for the national 2029 launch as the contracts awarded to these firms will not be flexible enough to make changes without no doubt further expensive negotiations.

One of the main aims of the scheme is to save public money through digitalisation and the DWP estimates a £2.6 billion saving up to 2035. One wonders though whether all the disabled people will be able to use computers to apply on line ( all PIP applications will be on line) eventually. Can they download apps etc and do they all possess smart phones?

Once again I am going to be sceptical about this – particularly after the NAO’s report on Making Tax Digital which it revealed has been subject to long delays and huge increases in costs. Given other areas I have covered in the DWP I have little confidence they can get things right.

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Revealed: the damning figures that show the NHS can’t cope with patient demand

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St George’s University Foundation Trust’s A & E department Pic credit: health trust

If you thought the NHS was at breaking point and want to know why – the National Audit Office have today provided a handy fact and figures guide to the decline of the country’s most cherished service.

A new report from Parliament’s financial watchdog charts the scale of both the failure of the NHS to respond to emergencies fast enough and the unprecedented demand from the public to use its facilities in the 13 years the NHS has been run by the Tories and the coalition government.

These are the startling figures:

711,881 A&E patients waiting over four hours from arrival to be admitted, transferred or discharged in December 2022, an all-time high. Since fallen to just over 550,000 in March this year.

90,998 ambulance handovers to A&E taking longer than 30 minutes in March 2023, equivalent to 25.9% of all ambulance handovers

32.0m reported number of appointments in general practice provided in October 2022, an all-time high, compared with 27.1 million reported in October 2018

92.3% general and acute hospital beds occupied during Q4 2022-23,representing record levels

88 seconds mean time to answer 999 calls related to health issues in December 2022, an all-time high

July 2015 the last time the NHS met its target for 95% of A&E patients to be admitted, transferred, or discharged within four hours of their arrival

8.4 million 111 calls answered within 60 seconds in 2021-22, compared with 11.2 million to 13.3 million between 2014-15 and 2020-21

1.27 million full-time equivalent NHS staff in February 2023, compared with the most recent low of 0.96 million in June 2013

£21.5 billion estimated annual cost in 2020-21 of providing the services reviewed in this report

Big variations in different regions in England

Delving deeper into the figures there are big variations in different regions of the UK. For example those being admitted, treated and discharged from A&E within four hours varied between 67.9 per cent in the East of England to 75.9 percent in the South East – both noticeably lower than the standard 95 per cent treated in that time just after the Tories got into power in 2011.

Similarly among ambulance response times there were wide variations. In 2021-22, the mean Category 1 (life threatening incidents like strokes and heart attacks) incident response time for the London ambulance service was 6 minutes 51 seconds compared with 10 minutes 20 seconds for the South-West ambulance service.,

In the same year the mean Category 2 incident response time for the ambulance service in the Isle of Wight was 26 minutes 20 seconds, compared with 1 hour 1 minute 57 seconds for the South-West ambulance service.

Some other points emerge why this is happening. The growing elderly population and general population increase in the UK is increasing demands on the NHS and effects of the Covid pandemic has left its mark.

More staff recruited but more off sick from stress

The government can claim it has recruited more NHS staff, including GPs and ambulance drivers. But this has been offset by more staff going off sick and more staff leaving the NHS because they can’t cope with the workload. I should not think the government’s attitude to keeping down pay rises in the middle of a cost of living crisis has helped either.

The government is promising a great £2.5 billion recovery programme and has allocated the extra money. But the NAO report says:

“More people than ever before are receiving unplanned and urgent NHS care every day. To support these services, the NHS is spending increasing amounts of public money and employing record numbers of people. Nevertheless, patients’ satisfaction and access to services have been worsening, suggesting there is no single, straightforward solution to improving what is a complex and interdependent
system.”

The real test will come next winter -since the government is promising much better services by March 2024. If it fails it will just add to the multiple problems facing this government and increase the distrust between the public and politicians.

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Yet another pension scandal .. Tory government cheats 4000 scientists out of their pensions by giving misleading advice when their company was privatised

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Their misleading advice has cost retired workers dear

The Commons Public Accounts Committee this week published a damning report on a long running pension scandal which has seen retired pensioners lose hundreds of thousands of pounds from their pension pots because of misleading official advice given to them 27 years ago.

The pensioners were all employees of the AEA Technology – the state owned commercial arm of the UK Atomic Energy Authority – which was privatised in 1996 by Sir John Major’s Tory government.

This sorry tale took place almost at the same time as the government had implemented the 1995 Pensions Act which raised the retirement pension for 1950s women from 60 to 65 and the DWP has been found guilty of partial maladministration by Rob Behrens, the Parliamentary Ombudsman.

The Tory government gave AEAT employees just one month to exit their contributory Whitehall pension scheme for a new one with the company taking over AEA. 90 per cent of the staff did.

Crucial to this rushed decision was an independent report by the Government Actuary’s Department which told all staff that the scheme was as good as remaining in the state scheme and might even be better.

What it failed to tell people was that if the company went bust or the pension scheme failed all the staff would lose their guaranteed protection of their pension savings that is provided by the government. It would be transferred to the Pension Protection Fund, lose all their inflation protection up to 1997, and they would live for the rest of their lives with only a 2.5 pc annual increase in their pension.

Government Actuary’s report was secretly changed by UKAEA lobbying

According to the written evidence from an ex employee David Roberts, a freedom of information request has revealed that this ” independent” report was tampered with by AEAT and the UKAEA behind the scenes. They got it rewritten because it was not persuasive enough to get people to quit the government scheme .

He wrote:” The sections which have caused the complaints were significantly changed as the result of a telephone conversation between UKAEA and GAD on 5/11/1996. “

GAD also failed to undertake a risk assessment about the switch.

In 2012 AEAT which had already cut funding to the pension scheme went into administration. The company was bought by Ricardo, an American firm, who immediately divested all its nuclear work .Its headquarters of a new firm are now in California.

One would have thought they sacked employees could get redress but for the last 11 years they have got nowhere.

They are barred from complaining to either the Parliamentary Ombudsman or the Pensions Ombudsman.

Current legislation bars the Parliamentary Ombudsman from looking into case involving private pensions – and the government has just told the Commons Public Administration Committee there is no priority to change the law.

The case could come under the Pensions Ombudsman but there is a 15 year cut off point from when the event happened which blocks him from awarding any compensation.

Nobody in government takes responsibility

As the PAC report says:

“Nobody in government has taken overall responsibility for the case. There has been no independent review because the relevant ombudsman services have said they cannot investigate the information given to members in 1996, clearly highlighting that there are gaps in the routes of appeal people have for complaints about their pensions.”

The response from government since 2012 has been appalling. The DWP not only did not help but confused the issue. The report says: “In July 2013, DWP produced a factsheet summarising the complaints government had received and a response to each on behalf of the government. In February 2014, it then sent scheme members a further letter explaining that it was not responsible for the case.”

But it didn’t tell them who was and it turned out to be the Cabinet Office.

Sir Steve Webb- declined to help as pensions minister

Ministers were no better. Sir Steve Webb, then the Liberal Democrat pensions minister, would not intervene to change any rules to help the pensioners -saying if AEA Technology rules were changed it would affect other government services that had been privatised citing the BT pension scheme. He was actually wrong in this case, it is protected should BT go bust.

Two MPs tried to use private members bills to rectify the situation by changing the Ombudsman’s powers – but they were blocked by the Conservative government.

The government has escaped responsibility by never setting up an independent review of what happened and the Government Actuary’s Department has tried to avoid censure by saying their report was not the main reason why people switched their pension. This is contradicted by the employees who gave written evidence to the PAC.

people abandoned by an uncaring state

The whole saga is simply part and parcel of a government that cares little for the welfare of the ordinary citizen and tries to evade responsibility for its errors. Meanwhile people – who contributed to their pension and even put extra contributions to increase it – are just abandoned by an uncaring state. One person lost 40 per cent of their pension and all are affected by the cost of living crisis since they are not protected by the huge rise in annual inflation by the Pension Protection Fund.

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HMRC’s digital tax disaster – overspent, behind schedule and a huge hidden bill for taxpayers

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Making Tax Digital |Government logo pic Credit: gov.uk

Rishi Sunak promised the UK will be a Science and Technology Superpower with world class digital technology attracting high skilled people from all over the world to come and work here.

Last October Chris Philp, then Minister for Tech and the Digital Economy,.at the Department for Digital, Culture, Media and Sport, also promised a bright future for the digital economy outlining the UK’s digital future with a host of government initiatives.

Rishi Sunak Pic Credit; Wikipedia

Back down to the real world the National Audit Office today published a report on one of the government’s initiatives – Making Tax Digital -and what a sorry story it is. For those familiar with Whitehall failures – it was the same story – the cost of the scheme had sky rocketed, its planned introduction had been delayed again and again – and worse, those businesses planning to go digital to pay their VAT, there was a huge additional cost, which somehow HMRC forgot to inform the Treasury.

The huge cost of switching the tax system to digital was supposed to cost £226 million when it was planned in 2016. This covered all VAT payments, businesses who pay via self assessment schemes and corporation tax. Instead it will now cost a staggering £1.3 billion – some five times the original estimate.

And it won’t be on time.

Scheme repeatedly delayed

The original programme was repeatedly delayed. Originally HMRC planned the entire changeover in 2020.

As the report says: “The timeframes for MTD[ Making Tax Digital] were agreed before HMRC had fully explored the range of options.” As a result large parts of the programme had to be rescheduled .And then came Brexit and the Covid pandemic which the hit the programme. Only VAT for larger firms was introduced before 2020 -in 2019 – and VAT for smaller companies waited until 2022 and the whole exercise cost £70m more than planned.

But it is the plan to switch over to digital tax for the self assessment businesses has been hit the most. The report said: In December 2022, the government pushed back the timetable for Self Assessment for the fourth time, delaying benefits and increasing costs further. On the advice of HMRC the government announced it would delay the start date for MTD for Self Assessment and take a phased approach to introducing it.
It won’t be implemented until 2026 or 2027 and even then not fully – as the original plan envisaged. It will apply to annual income above £50,000 in 2026 and above £30,000 in 2027. No date has been given for income below £30,000 which is still ” under review”.

HMRC left out cost to people of paying their VAT

On top of this HMRC in its business case forgot to tell the Treasury that it also landed business and taxpayers a bill for £1.45 billion. This is because for the digital system to work businesses and the self employed have to submit returns over three months and need to buy or lease expensive software to do it. So the government has put the cost on businesses avoiding the cost themselves. In my small way it hit me over VAT. Since my income was below the threshold I decided the simplest way was to deregister for VAT so the government now get nothing. Previously it was a simple form to fill in your quarterly VAT return supplied by HMRC.

HMRC said. “A project of this scale naturally comes with challenges, but MTD will deliver a strong return on investment for the taxpayer. We have always been wholly transparent about costs for business. We remain committed to ensuring that free software will be available for those with the simplest tax affairs.”

Gareth Davies ,Head of the NAO, said: ““The repeated delays and rephrasing of Making Tax Digital have undermined the programme’s credibility and increased its costs. They put at risk the support of taxpayers and delivery partners, including those who are essential to the programme succeeding.  

“Our audit identified the omission of significant costs from some business cases. It is obviously important that business cases for major programmes such as this contain all the relevant information to support decision-making.”

My view is a bit broader than that. I am getting very fed up with rhetoric from leading politicians telling the public that every project is world class when clearly it isn’t. This report from the NAO shows what is happening in the real world, not in the complacent fantasy world of the present Tory politicians who govern us.

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Revealed: The great public ignorance about your state pension

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State pension banner when the new pension came into force in 2016

One of the key complaints made by the 3.6 million 50s born women is that they didn’t know about the six year delay in the rise of the pension age for women from 60 to 66 until it was too late. This along with direct discrimination against women caused by the absence of a level playing field with men for that generation of women to pay national insurance contributions is behind this long battle with the government.

Now a report published today and sent to me reveals that these 3.6 million women are by no means alone. It implies that the majority of people in the UK today have little knowledge or understanding of how the state pension system works. A research report from the Policy Institute of Kings College, London commissioned for Phoenix Insights, a think tank for a large savings company, reveals that many people have misconceptions about the system. When these are pointed out they are unhappy about the current level of the pension and are concerned about how vulnerable people can live.

The research is not based on mass questionnaires but by taking 100 people in London and Birmingham and giving them detailed information at workshops after receiving a talk from former Liberal Democrat pensions minister Steve Webb. This enabled them to put forward policy changes they would like the government to enact.

Steve Webb gave a presentation to the group

The biggest misconception comes from how people think they have built up their pension. Some, believe it or not, think they just get an automatic full pension, when they reach retirement age provided by the state. One said: ““I thought when you retire everyone is entitled to the pensions. I don’t know why…I thought this is what happens.”
 But the majority believe by paying national insurance contributions all their working lives they have built up their own personal pension pot which they are entitled to get when they retire. This is a complete lie. Their money is instead used to pay people already retired to get a pension.

People are not stupid about state pensions – just misled

People are not stupid in believing this because the way the scheme works makes it look like that. Your level of pension depends on your national insurance contributions and you don’t get anything until you have made ten years contributions and only a full pension after 35 years. Anybody who contributed to a private pension scheme. would think that because that is the way they work..

Rather worryingly nearly half the people thought they had a a basic knowledge of how the pension system works and were embarrassed when they realised they didn’t.

When all this had been explained to them, the report reveals people thought the present system did not deliver an adequate pension for everybody.

As the report says: “The study identified five main knowledge gaps covering most of the core elements of how the state pension system works: the number of years of National Insurance contributions needed to qualify for the full state pension, eligibility criteria, the value of payments, what the “triple lock” is, and how the state pension differs from workplace savings.”
 The people’s conclusion was that the state pension was inadequate for anybody to live on without being able to top it up with a workplace pension, a private pension or property assets. Some retirees among the 100 people said unsurprisingly that the cost of living crisis had made a big impact.

People also thought that vulnerable people needed more help -particularly those with health issues who could not work – and either the level of benefit should be higher or they should be able to draw a pension earlier than the official retirement age.

People had bought into the government’s argument that the retirement age should rise because people are living longer – even though at the moment longevity has stalled and started to fall in poorer areas.

Phoenix Insights said: ” When we talk about longevity, we are looking at a long term view of life expectancy in the context of comparing to previous generations. Long-term life expectancy improvements mean that the pensioner population is projected to increase by over 5 million, rising from over 12 million today to over 17 million by 2070 (DWP, 2023).”

I thought this report is rather damning of the failure of successive government to explain how the state pension works or so many people would not be so ignorant. And it might suit governments that this remains so – or it would create a groundswell for much higher pensions.

But it is also a damning indictment of the minority of people who try and blame the 50swomen for not realising about the pension changes that have left so many people in poverty. They may well be the very people -unless they are pension experts – who are ignorant themselves and get a shock when pension day dawns.

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Promises, Promises! Suella Braverman’s half baked response to the Independent Inquiry into Child Sex Abuse report

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Suella Braverman Pic credit: BBC

While the Parliamentary Lobby were excited about Suella Braverman’s latest escapade trying to fix a private driving awareness course for herself to avoid penalty points on her licence, yesterday she took the opportunity to issue a very important statement on how the Government will tackle child sex abuse.

Whether the timing was aimed as the latest diversionary tactic to avoid further embarrassment , the result was a half thought out and half baked response to a very detailed and important piece of work on a scandal which shames our nation.

Alexis Jay, who headed the inquiry, spent seven years investigating what was seen as as ” a national epidemic ” of child sexual abuse which affected virtually every single religious order, schools, the internet, and grooming gangs across the country. Her report exposed heinous cases of child sexual abuse from teachers to bishops and appalling attempts to cover up what had happened. While by no means perfect, it also did provide some outlet for the survivors to speak out about what had happened to them.

Government hyperbole

Yesterday with I am afraid the typical hyperbole the government uses at almost every occasion now Suella Braverman claimed that the reforms proposed were “on a level not seen before” and would “mark a step change in our approach to child sexual abuse”.

She told MPs: “This Government have risen to the inquiry’s challenge. We are accepting the need to act on 19 of the inquiry’s 20 final recommendations. She promised MPs “fundamental cultural change, societal change, professional change and institutional change.”

But when you examine closely what the government proposes to do it is nothing of the sort. Many of accepted recommendations are surrounded by caveats for further reviews and debates and none are going to be implemented immediately.

Alexis Jay, chair of the independent child sex abuse inquiry

And I am not the only person saying this. The chair of the inquiry, Alexis Jay, told the Independent today:

“We are deeply disappointed that the government has not accepted the full package of recommendations made in the final report,” she added.

“In some instances, the government has stated that a number of them will be subject to consultations, despite the extensive research and evidence-taking which the Inquiry carried out over seven years.

“”The package announced by the government will not provide the protection from sexual abuse that our children deserve.”

Similar doubts were expressed by the NSPCC, the children’s charity.

If you study the detailed response from the government – you can find it here – you will see it is riddled with caveats and rejects more than one finding as the minister claimed.

The headline change – setting up a compensation scheme for the survivors – is a promise but subject to much more consultation before it is to be implemented. A more competent government would have laid the bare bones of the scheme, how much money will be provided and then asked people, including survivors, to comment yesterday.

Similarly with mandatory reporting of child sex abuse by professionals – which was thoroughly debated by the inquiry before recommending it – it won’t happen immediately. Instead it is put out for more consultation. Do we need any more?

Other accepted recommendations are a con. The recommendation for a children’s minister at Cabinet level is glossed over by saying we already have one – the education secretary. Yet provision for children is more than just education. And Rishi Sunak could do with someone present at the Cabinet to fight children’s issues.

And the creation of new child protection authority does not look likely to happen any time soon.

And there is one extraordinary proposal. Braverman rejects – the inquiry’s recommendation to outlaw inflicting pain on residents of young offenders institutions and secure units – claiming that there are ways of safely inflicting pain on young people. Is she some sort of a sadist who enjoys bringing pain and misery to the young or just plain stupid? Pain is pain full stop. If anyone knows how this might be done I would like to hear from them.

The government is also relying on its on line safety bill to outlaw child pornography but it seems the paedophiles are already one step ahead of her. Sajid Javid, ex minister and Tory MP for Bromsgrove intervened in her announcement to say they are already using artificial intelligence to produce child sexual images. How is this to be traced?

Frankly this was a disappointing statement dressed up as the government taking action. Ministers and civil servants have had seven months to respond and could have laid the groundwork for real change rather an promising more consultations. But given Suela Braverman’s track record why should we be surprised.

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50s women pensions: Will rival attempts to speed up compensation for the 3.6 million work?

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Royal Courts of Justice

While I have been away there have been significant developments in the long battle to get justice for the 50swomen who lost tens of thousands of pounds through maladministration, discrimination and lack of communication over the six year rise in their pension age.

Like everything in this long tortured tale the developments have not been straight forward.

Basically two separate initiatives have been launched. WASPI after first going along the route of seeking justice for 50swomen through Rob Behrens the Parliamentary Ombudsman, suddenly turned on him threatening him with a judicial review and launching a crowdfunder to fight him which raised nearly £150,000.

Alternative Disputes Resolution

Backto60, as the only organisation that campaigns for full restitution for the women, launched a plan to call for an Alternative Disputes Resolution, to negotiate a settlement with Mel Stride, the secretary of state for works and pensions, to end this long running dispute which has angered so many women who feel cheated by the DWP. This is backed by 54 MPs, petitions that have attracted 87,000 signatures and a Parliamentary motion.

Both the initiatives I suspect followed the leaking of the Ombudsman’s first and second stage reports on the issue on this blog. Without them becoming public the 3.6 million women affected would not have known the full and frankly paltry proposals by the Ombudsman to solve this dispute. And I have not forgotten senior people from Waspi pressing me to remove the posts so the reports would remain part of a private discussion between them, the Ombudsman and selected MPs rather than allowing the 3.6 million victims the opportunity to read them. And the second one is still not published.

The reason that I suspect WASPI turned is that it was becoming clear that the compensation would be meagre and limited – the DWP could decide ( as they have following other Ombudsman’s reports) that only the six complainants would automatically get compensation of £1000 and some 600 will have to fight for it .It looked a far cry from the promise by Waspi’s chief spokesman, Angela Madden at last year’s Labour conference of between £10,000 and £20,000 for everybody. That is still a lot less for many people owed up to £50,000.

Angela Madden WASPI

Now developments have moved fast on this proposal. It is clear that WASPI, the Ombudsman and teams of lawyers from Bindman’s and Blackstone Chambers have come to a compromise which ended up in the high court last week. Reading the order from Judge Kirsty Brimelow it is clear that parts of the Ombudsman’s second stage report are quashed. These deal with the latter part of the report which rejected any financial compensation for women whose well being and life choices were affected by the delay and did not acknowledge the impact of the DWP pausing sending out letters to women.

The section was admitted by the Ombudsman to have been legally flawed by not taking everything into account.

Crowdfunder page

Since then WASPI have issued on their Crowdfunder page a series of ten conditions which ,it says, the Ombudsman should fulfill.

“WASPI will not be passively waiting for its outcome. At each stage we will be pressing the Ombudsman not only to complete his investigation in a way that is as rapid as possible but also thorough and fair. We will also be raising concerns about this with MPs, particularly those who sit on the Public Administration and Constitutional Affairs Committee (PACAC) which oversees the Ombudsman’s work. And we will turn to our lawyers for their expert input when responding to the Ombudsman’s draft reports and if we have concerns his investigation may be derailed again.”

The Ombudsman has been more cautious. He has agreed that he will show Waspi and the complainants his proposed changes and accept comments before finally presenting his report to Parliament.

A spokesperson committed them to looking at the report again adding” We don’t currently have a timeline, but we want to resolve the investigation as swiftly as possible, so any mechanism for remedy can be implemented for those affected.”

Now while this is happening Back to 60 pursued a different tack. The key issue for them has been the People’s Tribunal which looked into the plight of the 50swomen under the UN Convention on the Elimination of Discrimination against Women (CEDAW) Tribunal held last year and the judgement given by Judge Jocelynne Scutt which ruled that the women had suffered both maladministration and discrimination.

Jocelynne Scutt

Some critics have tried to say the tribunal and the report are irrelevant because they have no standing. Given that the deputy chair of CEDAW in Geneva gave evidence to it and the judge was one of Australia’s first discrimination commissioners, such criticism seems rather ridiculous. to put it mildly.

The judge took a strong view that Parliament had a moral duty to this. “Government and Parliament have a responsibility to face up to and acknowledge the grave wrong done. There is no room for obfuscation or quibbling. Historic discrimination requires relief. There is a moral imperative to right this wrong. The law is on the side of 1950s women.”

Sir George Howarth

Sir George Howarth, Labour MP for Knowsley, who chairs the Alternative Disputes Resolution project has already written to Mel Stride, asking to come to a meeting. The organisers have also invited Waspi who have not replied.

What is missing is what the DWP will do. It has registered as an interested party to the proceedings over the ombudsman’s report but did not send lawyers to the hearing last week.

Any question to ministers on these developments is met with the answer that it is ” neutral” and would not comment because of the legal proceedings.

This is not surprising , the DWP can’t commit to implementing the Ombudsman’s findings if it doesn’t know what they are. The proper procedure will be after the final report is published.

Will these initiatives work?

The stumbling block for Waspi is that the Ombudsman cannot compel the DWP to accept his findings – even if he does everything Waspi wants. This is one reason why legislation needs updating to strengthen his power which the government is reluctant to do.

The disputes procedure cannot get off the ground without the DWP agreeing to come either.

We could be left with a stalemate with the DWP playing one side against the other and sadly it will still mean women will not get the compensation they badly need. Difficult and confusing times lie ahead.

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