The Sunday Times reports today (27th July) that HMRC is to write off £2.8 billion as a consequence of problems with a computer system. So that’s another 5.5 billion dollars thrown on the Trillion Dollar Bonfire, without so much as a blink of an eye.
According to the newspaper, the latest HMRC accounts apparently show a further planned write-off of £1.8 billion, in addition to an earlier write-off of £1 billion, in respect of unrecoverable over-paid Tax Credits.
The huge overpayments [believed to total £8 billion] were made since the introduction [April 2003] of the Revenue’s flagship Tax Credits system. Early “computer errors” were blamed for a proportion of the overpayments and the system supplier [EDS] was penalised just over £7o million.
I believe that this is yet another hugely expensive example of a failed Government IT project, although the Sunday Times quotes HMRC’s view that the system has been working well for the past two years.
Of course, I also believe that every Government IT project will always bring unexpected cost and disappointment for the taxpayer, unless and until someone starts understanding that we need effective Information Systems, not IT projects.
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