In her Annual Report for 2019, the Adjudicator Helen Megarry describes improvements in her Office, both in how complaints from the public are handled and in the time taken to deal with them. She notes that the number of complaints that she upholds against HMRC (the ‘upheld rate’) has remained steady at 35% with a slight reduction in complaints about Benefits and Credits. However, the report is critical of HMRC’s failure to put to good use the feedback the Adjudicator has given from the complaints she and her Office have dealt with. She says:
‘The improvement in departmental complaint handling, evident when I first took office, has stalled over the past year. There is no evidence of a comprehensive, organisation-wide understanding or acceptance of the importance of good complaint handling, or the potential to learn from complaints. Although I see numerous isolated examples of good practice in complaint handling and customer service, it is not consistent.’
She adds that the Department is ‘missing opportunities to maximise the value of complaints as a direct and unfiltered source of feedback from customers about how they experience their interaction with the department’.
The role of the Adjudicator
The Adjudicator handles complaints referred to her which have been through HMRC’s complaint handling processes but are still unresolved from the customer’s point of view. The Service Level Agreement between the Adjudicator and HMRC, which was revised in May 2018, sets out the role and remit of the Adjudicator and the Adjudicator’s Office (AO) as follows:
‘The Adjudicator and AO will provide an independent review of complaints about HMRC to a quality standard in line with industry good practice. In doing so, they will consider if HMRC has provided a fair and consistent application of its published standards, guidance and codes of practice, with the factual evidence of the complaint.’
Under the agreement, the Adjudicator can look at complaints about mistakes, unreasonable delays, poor or misleading advice, processes, whether a policy has been followed, inappropriate staff behaviour, and the use of discretion.
Apart from their role in resolving complaints, the Adjudicator and the AO may also ‘use insight and expertise to support HMRC to learn from complaints and improve services to customers’.
This aspect of the Adjudicator’s role has gained in significance in the last few years under Helen Megarry and her predecessor Judy Clements.
Every Adjudicator’s report has contained a selection of cases handled during the year, and the current report highlights those which emphasise the aspects of learning that the Adjudicator wishes HMRC to take on board.
One case illustrates quite graphically the type of process-driven culture and lack of customer focus that the Adjudicator criticises in this report. The complainant, Miss G, had a choice following the birth of her second child to stay on universal credit and add the child to her claim, or cancel her universal credit claim, wait six months and make a new claim for tax credits. However, the Tax Credit Office (TCO) simply told her she could make a new tax credits claim, without mentioning the six-month wait. Miss G did what the TCO advised, only to have her claim rejected because she was still in receipt of universal credit. So she cancelled her universal credit claim and re-applied for tax credits, only to have her claim rejected again because of the six-month rule. During the months that followed, she sought advice many times but the advice she received was ‘repeatedly contradictory, unclear, inconsistent, and unreliable’. The TCO considered they had no responsibility for the original misadvice which led Miss G to cancel her universal credit claim and endure six months of financial hardship.
The Adjudicator set out some ‘key learning points’ for HMRC. Two passages are worth citing as they represent a clear statement that HMRC should take responsibility for giving wrong advice to a customer, and should seek to restore the customer’s financial position accordingly:
‘It may not be reasonable to expect Helpline advisors to get everything right every time, but when a mistake is made the department must take full responsibility for that and understand the causal effect on a customer.’
‘HMRC should consider the full extent to which they can provide remedy for the impact of their mistakes, in order for their customers to be in the correct financial position.’
In response, Jim Harra, the Tax Assurance Commissioner and Second Permanent Secretary for HMRC, writes that HMRC is setting up a complaints board to ‘embed further HMRC’s learning from the Adjudicator’s work’ (page 31) and adds that a secure digital channel for the public to contact the AO directly will be delivered by Autumn 2019. This was recommended jointly by the Adjudicator and the Treasury Select Committee.