Feeds

EDS and HMRC skewered by MPs - again

Overpayments to top £2.2bn - again

  • alert
  • submit to reddit

Seven Steps to Software Security

The Public Accounts Select Committee has become the latest group of MPs to lay into the HMRC and its serially unlucky former IT partner, EDS, in the latest report on tax credits debacle.

A report by the committee says that overpayments for 2004 to 2005 are expected to be around £2.2bn – the same as the 2003-2004 overpayment that first dragged the scheme into disrepute last year.

The committee said the problems were primarily down the way the scheme is run. Payments in a given year are provisionally paid based on the previous year’s income, and are only finalised when the year in question is over. Because incomes tend to increase, the committee says, it is very easy for applicants to be overpaid. Hardship then results when the government attempts to claw back overpayments. The committee noted the department had made a £1bn provision for doubtful debts. It also noted that recent budget changes should reduce the level of overpayments.

EDS was also targeted in the report, which said computer cock-ups also led to incorrect payments being made. EDS was finally forced off the contract in late 2003.

Gross losses down to EDS amount to £209m, the committee said, of which £105m is being clawed back from claimants. The department has reached a settlement with EDS of £71.25m, including cash payments from EDS and “the off setting of certain amounts which would otherwise have been due from HMRC to EDS”. Staged payments of £26.5m are contingent on EDS winning more business from the government.

The part of the settlement for EDS’s mistakes that depends on the services giant grabbing more public contracts has angered members of the committee. Committee chairman Edward Leigh described this as “an invidious position”, according to the BBC. ®

The Power of One Infographic

More from The Register

next story
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
UK Parliament rubber-stamps EMERGENCY data grab 'n' keep bill
Just 49 MPs oppose Drip's rushed timetable
MPs wave through Blighty's 'EMERGENCY' surveillance laws
Only 49 politcos voted against DRIP bill
EU's top data cops to meet Google, Microsoft et al over 'right to be forgotten'
Plan to hammer out 'coherent' guidelines. Good luck chaps!
US judge: YES, cops or feds so can slurp an ENTIRE Gmail account
Crooks don't have folders labelled 'drug records', opines NY beak
Delaware pair nabbed for getting saucy atop Mexican eatery
Burrito meets soft taco in alleged rooftop romp outrage
LightSquared backer sues FCC over spectrum shindy
Why, we might as well have been buying AIR
'Two-speed internet' storm turns FCC.gov into zero-speed website
Deadline for comments on net neutrality shake-up extended to Friday
prev story

Whitepapers

Reducing security risks from open source software
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Application security programs and practises
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.