HMRC told to demand compensation for IT problems

MPs urge department to deal with "very serious errors" in IT systems

HMRC has been told to get tough with IT suppliers

The tax authorities are being urged by MPs to demand compensation from IT suppliers for "very serious errors" in computer systems.

MPs on the Commons Treasury Committee said it was "wholly unsatisfactory" that 130,000 children had not received £250 child trust payments due to them, several thousand up to two years after they were due.

And they criticised the HM Revenue and Customs (HMRC) system crash which hit last-minute tax returns last year, caused by the provider changing the platform without adequate examination of the risk.

HMRC permanent secretary for tax Dave Hartnett told the committee there had been "some very vigorous discussion with our IT provider around that issue".

The committee agreed that a one-year delay going live with HMRC's new computer system to allow adequate testing to be completed was "prudent".

The MPs, in a report last week on the Chancellor's departments, also said they were "extremely concerned" about the level of fraud within HMRC, demanding the department address the risk that staff of the Department for Work and Pensions, with access to the system, can abuse access rights to provide data to fraudsters to make false claims.

Six cases of suspicious access had been identified and "pursued with the full rigour of the law", the report said.

And the committee asked HMRC to provide an analysis on the demographic profiles of those forced to pay £100 late paper-based tax return filing fees because they cannot cope with the internet version amid concerns that the less well off and elderly may be losing out.