The Problem with Tax Credit Investigations – They are too Costly & too Inefficient!

The UK is probably at its lowest ebb since it was formed, which is why it is so surprising that the government is going all-out to convince the people that things are better than ever. It’s a bizarre phenomenon, because however much you try to declare an onion is a toffee apple, it is still going to taste like exactly what it is.

One of the issues that they are currently trying to pull the wool over our eyes with is the tax credits scheme, and their so-called victory in the war on benefit fraud. A telling statement from HMRC was the declaration that “Fraud in the tax credits system has been reduced to its lowest level”. On the surface this sounds like a very satisfying result, but do a little digging and you may discover that things are not quite like they are being made to appear.

Consider that fraud, by its very nature, is not supposed to be detected. Fraudsters have two aims:

1. To make money dishonestly, and
2. To not get caught

This means a successful fraud is one that is not detected. So has fraud really been reduced, or is it simply that less people are getting caught? But as you’re probably already aware, thousands upon thousands of people are being singled out and investigated, sometimes for really ridiculous reasons where it’s quite clear that they are not guilty.

That means huge numbers of people being investigated with very low actual detection rates, which is being interpreted as a drop in the level of fraud. They’re catching less people because they are casting their net too wide, disadvantaging the most people for the least result. And because they are so busy fishing for minnows, the sharks are swimming away freely.

The things that are labelled as fraud are also highly questionable. Increasingly often the term “fraud” is being used in a political way to mean something quite different to actual fraud.

If all this were harmless, it really wouldn’t matter so much. Innocent people may feel a bit upset that they’re being put through the wringer, but they’ll still have the satisfaction of knowing that they’ll emerge completely spotless because they’ve done nothing wrong. Unfortunately, though, the investigation process currently in place is not at all harmless. For some people, it is an absolute nightmare.

The first, and probably biggest part of the mess is caused by the use of private contractors, in this case an American corporation called Concentrix. An efficient investigation service would be one that gathered a watertight case against a suspect before proceeding with action against them, before even notifying that individual that they were under suspicion. Simply finding any old excuse to raise an investigation and stop a person’s benefits until they can prove their innocence is a display of shameful incompetence. But since it provides the government with exactly what is needed (a short term drop in the welfare bill and a chance to show how “tough” they are getting), this is not something that is just going to go away.

The second part of the problem is the attitude shown by many people who are not part of the benefits system towards those who are. Most commonly the complaint raised is that they resent paying taxes so other people can just lay about doing nothing. This kind of thinking is derived from the fact that for most of them, laying about doing nothing is pretty much their dream for most of the year. They therefore have no clue how utterly soul-destroying it is to be put in the position where nothing is all you are able to do. Not because you wouldn’t be a good worker, but because nobody will give you the chance to prove yourself.

If you are one of those who has fallen victim to this way of thinking, then all you have to do to cure yourself is think about the kind of environment you want to have around you. If you have to choose between:

1. A society which is generally stable, provides sufficient means for everyone to live a reasonably decent life if they choose to do so, and is for the most part safe, or
2. A society that disregards the basic survival needs of poorer citizens, such that they are forced to ensure their survival by any means possible, including taking directly from you

There won’t be any prizes handed out for guessing which one you would pick. What you probably have not realised up to now is that every time you complain about the “scroungers”, you’re actually making a statement that you’d prefer to live in a chaotic state of lawlessness where nobody would feel safe.

The problems with Concentrix’s handling of tax credits investigations was highlighted by claims from Karl Turner, Labour MP for Hull, that many of his constituents had been badly affected by investigations that dragged on for too long. Concentrix seems to think that “putting things right and apologising” is enough to make up for the many serious problems that are caused to people by these matters, and their definition of “putting things right” is probably very different to yours and mine.

Concentrix isn’t the only American company that the government has outsourced to with disappointing results. Now the company trusted with performing Work Capacity Assessment tests (mandatory in many cases for people with disabilities) has found itself embarrassingly in the spotlight. This company, called Maximus, and its predecessor Atos, have been accused by Louise Haigh of falsifying the results of their tests to the disadvantage of disabled people on benefits. So what this indicates is that outsourcing these kinds of tasks is a failed experiment needing revision.

For quite a number of people, having their benefits stopped is nothing short of a disaster, and all kinds of secondary problems can arise, from being evicted to getting into debt. Tragically sometimes they get into debt with the sort of characters that it is not very wise to get into debt with, with predictable results. And all needlessly because, more often that not, they really didn’t do anything to deserve it. Even if they had, there are other ways to tackle the problem than simply stopping benefits cold, and those methods won’t have the same serious repercussions to society.

Making needy people more desperate leads to the potential for all kinds of harm to arise, and when it is affecting thousands upon thousands in ever-increasing numbers, eventually something will have to give. The pressure will simply become too great to contain.

Why is Concentrix conducting these inefficient investigations that actually do more harm than good then? Surely it can’t be simply down to them being an “evil organisation”, and it isn’t! The real truth is explained in this article from the Independent where workers at Concentrix admitted that they were under pressure to open between 40 and 50 new tax credit investigations every day.

What happens when you have quotas like that and it’s already a known fact that the vast majority of people who claim benefits do not commit fraud? It’s not hard to imagine that workers simply have to invent reasons for why the claimants might be guilty, and then let them try to prove their innocence. The system is set up in such a way that the innocent and the guilty are punished in advance, and only the innocent have any chance of recovery, and where both will suffer terribly while awaiting the outcome of the investigation. Any system that works this way is seriously flawed.

Even more worryingly, because most people know they haven’t done anything wrong, a situation arose where many people thought the letters or other communications they received from Concentrix were hoaxes.

There are genuine tax hoaxes out there, and the communications from Concentrix don’t really look any different. In fact, the reasons given for why an individual is under investigation are often so laughable that people may not take them seriously. Except it is no joke, and there is nothing funny about it… ignore the letter from Concentrix and you will soon be in an even more disadvantaged position.

If you receive a letter from Concentrix, you should not ignore it, but you should not respond to it either. What you should do is call Hylton-Potts on 020 7381 8111 or send an email to [email protected] and we will help you get the matter resolved promptly.

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