Recommendation 6

Yet again customer service has collapsed and HMRC’s recovery plans are not clear. For over a decade this Committee has repeatedly reported on HMRC’s inadequate levels of customer service. Following an examination by this Committee in 2016, HMRC’s customer service improved, but since 2017–18 it has been declining. The decline in performance accelerated in 2020–21 as HMRC diverted resources to its COVID-19 response and UK’s transition from the EU. HMRC told us that its call handling performance had improved in 2021–22, but there were still long delays in responding to correspondence. Since HMRC was established in 2005, its staffing levels have reduced by around 40%. HMRC told us that its customer service resources had been reducing over time and that it was resourced to give a “decent” rather than a “brilliant” service. HMRC’s strategy for customer service is to discourage the type of calls that do not change people’s tax outcomes or move such calls online. We are concerned whether this strategy is deliverable. As the Committee reported in 2016, HMRC tried a similar approach before, but it was overly optimistic about reductions in calls, with service levels collapsing when it cut staffing. HMRC is not publicly reporting call handling speeds for 2021–22 and has not a set a target for its correspondence response time measure. We will continue to scrutinise HMRC’s response times until confident that HMRC is sustaining acceptable service levels. 8 HMRC Performance in 2020–21 Recommendation: HMRC should, in its Treasury Minute response, explain: • the service levels it is aiming to provide and by when, including for the time taken to answer calls and respond to post, and commit to publishing outturn against these measures; • how it has tested the realism of its customer service plans; and • its contingency plans if the numbers of taxpayers writing and calling exceed forecast levels.