Public Services > Central Government

HMRC tells PAC it has “strong leadership team” in place for Aspire transition

David Bicknell Published 28 July 2016

Department responds to Public Accounts Committee’s recommendation that it “must ensure continuity in the leadership of the Aspire programme”

HM Revenue & Customs (HMRC) has insisted that it does have the requisite leadership in place to make its exit from the outsourced Aspire contract a success.

It follows a  report from the Public Accounts Committee (PAC) this week which concluded that HMRC “is now making progress in replacing the Aspire contract”. But it warned that moving to a new model of IT provision remains a substantial undertaking “which will require firm and consistent leadership.”

It said, “HMRC now plans to take crucial decisions in 2018 on the long term IT model it will operate from 2020. We remain concerned that HMRC may struggle to integrate different services from different providers. As we have seen from elsewhere in government, one of the main factors that determines the success of complex programmes such as this is the quality and stability of their leadership.”

One of its recommendations was that HMRC “must ensure continuity in the leadership of the Aspire programme to maximise its ability to design and introduce a new IT model successfully.”

That includes the position of HMRC’s chief digital and information officer Mark Dearnley, whose three-year contract runs out at the end of September.

Asked to clarify his position by the committee, Dearnley said, “Jon (Thompson. HMRC’s chief executive and First Permanent Secretary) are looking at each other because you are right. Technically my contract finishes at the end of September because I was here for three years. As Jon has just arrived, it is a conversation we have just begun.”

Asked what brought him into HMRC, Dearnley said, “There were two challenges that appealed to me. One was the opportunity to do what we have just discussed, which is: how do you take one of the largest IT contracts and safely transform it into what it needs to be? The second, which I would love to spend even longer talking about, is the digital transformation of HMRC. We have gone from something that worked really well for self-assessment to something where now 65% of all the things people want to call us about can be answered if you go to your personal tax account. The digital transformation was the hugely exciting thing that brought me here as well.”

Thompson was told by the PAC’s long-standing member Richard Bacon, “Get your skates on, Mr Thompson; we want to keep him,” to which Thompson replied, “We all share the same aspiration. We are in negotiations.”

HMRC has said there is as yet no update on the negotiations and it won’t speculate on them.

But it responded to the committee’s leadership concerns, saying in a statement, “Our plans for the phased transition from Aspire have been created by a strong senior leadership team in HMRC and continue to have the full support of our Executive Committee. We are also using specialist external help from the market to make this programme a success.”

One of these external companies is the consultancy Bain & Company, which HMRC brought in as an external  delivery partner to support its leadership team and help deliver the transition and which is mentioned in the PAC report.

In response to a further recommendation from the PAC that it be kept informed on progress at each key point in the Aspire programme, HMRC confirmed that it will provide written updates to the Public Accounts Committee as the phased exit from the Aspire IT contract progresses.

In its conclusions on HMRC’s quality of service to taxpayer customers, the committee said HMRC had released too many staff too soon because it was over-optimistic about how quickly the demand on its call centres would fall. Between 2010–11 and 2014–15 HMRC cut staff in personal tax from 26,000 to 15,000.

This included releasing 5,600 staff in 2014–15, reducing customer service capacity, which corresponded with a significant deterioration in the quality of service provided. HMRC’s staff reductions included 2,500 redundancies of trained personal tax staff it considered were in offices or on contracts incompatible with its workforce strategy.

The PAC pointed out that “HMRC plans to further digitise its services and reduce the number of staff in personal tax by a further 34% by 2020–21. It acknowledges that the challenge of getting customers to use online methods of contact (for example, a digital tax account) is the key risk it faces in personal tax services.”

The PAC recommended that HMRC must test whether its forecasts of demand are realistic and be prepared to flex its resources as necessary to ensure service demand is met. HMRC should pilot how taxpayers will respond to new digital services before they are widely implemented.

This week, HMRC agreed an extension of its application services agreement with Accenture that will see the company develop and introduce a secure cloud-hosted tax management platform for individual users.

Lasting up until June 2020, the extension agreement, which will incorporate new functionality for tax services, is intended to support increase used of digital technologies linked to the personal tax platform, as well as National Insurance and PAYE service functions.

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