The tax authority is condemned for being a willing accomplice with Concentrix, as the contractor wrongly swiped payments from thousands of vulnerable people.
Tax chiefs sought a fresh contract with a US firm despite being “well aware” that its blunders were plunging tax credit claimants into poverty, a report reveals.
HM Revenue and Customs is condemned for being a willing accomplice with Concentrix, as the contractor wrongly swiped payments from thousands of vulnerable people.
Concentrix was hired by HMRC to root out fraud and error in the tax credit system and stop payments to claimants who were not entitled to them.
But a staggering 90 per cent of people who appealed against losing their tax credits won their cases – a figure described as “extraordinary” by the Commons Work and Pensions Select Committee.
Its report accuses both Concentrix and HMRC of setting ‘strike rates’ to stop tax credits, causing people to suffer “humiliating hardship and debt” and sending many to food banks.
The firm was “incentivised” to claw back as much as it could for the Treasury – with a cut to a claimant’s benefits being described as a “strike”.
However, the MPs also expose HMRC for negotiating a new contract until just four days before the scandal forced it to pull the plug on Concentrix – and for giving misleading evidence.
Frank Field, the committee’s Labour chairman, condemned the pain caused by a “cut first, think later” strategy.
He said: “The damage caused to families’ living standards by this ‘strike rate’ is still being felt by my constituents needing to rely on food banks while their claims are reinstated.