Tax credit IT under fresh attack

The government is facing renewed criticism of the design and implementation of the IT systems behind its flagship tax credits programme.

Citzens Advice said that poor administration and system failure has pushed many families into mounting debt. Its advisers found it impossible to resolve even simple problems for families because the tax credit IT systems left helpline advisers unable to provide accurate information. Letters have also gone unanswered, sometimes for months, it claimed.

In a separate report the Parliamentary Ombudsman said many of the problems with the system arose because the design of the system didn't take account of the needs of customers.

The processing of tax credits claims is entirely automatic - most tax credits claims are captured electronically, then checked and processed, and the entitlement calculated, without human review.

But the Ombudsman said while this produces a streamlined service, the customer experience suggests that it is not meeting the needs of many families on low incomes.

"The system appears unable to provide an immediate, responsive and appropriate service, particularly when things go wrong," it said.

The system faced IT problems when it was launched, and finally stabilised four months after tax credits began. It was hit by two more major software problems in the first year of operation.

But the Ombudsman's report said problems continue: "The complaints coming to us reveal a wide variety of technical problems or 'glitches' which, over the last two years, have affected a considerable number of customers."

Many of these technical problems were then compounded by human error, it added.

The Ombudsman said the project provides important lessons for the future design of major IT projects, particularly in the social welfare field.

"It demonstrates the importance of making consideration of all potential customers a central element from the start. The intelligibility of information to customers, good communication and effective mechanisms to deal with things that go wrong should not be afterthoughts but central and built into the system design," it said.

Paymaster General Dawn Primarolo said there is still work to do on the system. She told Radio 4's Today programme: "It is not a system in complete collapse - it is working for the majority. There are problems for some families because of IT in the early period and processing errors that haven't been dealt with as well as they should have been. The department has to be pushed and I am doing that."

Plus: Read our leader on the lessons learned from the botched tax credits IT system.