The government minister in charge of tax credits has been accused of losing control of her department, by an influential committee of MPs.
Some families have been "desperate" because of delays
Paymaster General Dawn Primarolo was being grilled by the Treasury Select Committee over the introduction of tax credits, which replace benefits for many families.
Thousands of people have experienced frustrations and financial hardship because credits have not been paid on time, while some are still waiting.
Ms Primarolo was also questioned about the sale of Inland Revenue buildings to a company based in a tax haven, as reported by BBC News Online last September.
Problems about national insurance deficiency notices are also high up the committee's agenda.
Potentially millions of people are facing a state pension shortfall because the Inland Revenue has failed to inform them that they may need to top up their pension contributions.
As a result, one member of the Treasury select committee asked the minister: "Have you not lost control of your department?"
The revelation that the sale of Inland Revenue buildings, worth £370m, to a company based in a tax haven was not directly authorised by ministers drew consternation from MPs.
"Whilst you have ministerial responsibility you do not have ministerial knowledge," committee chairman John McFall MP said.
The new tax credits - the Child Tax Credit and Working Tax Credit - were introduced in April.
They have replaced three existing tax credits which were available to parents with children and disabled people.
But BBC News Online has received a large number of emails from readers who have become increasingly frustrated by the non-payment of the credit.
But the government has consistently denied the system was in crisis, even though the National Audit Office is to investigate the way in which the system was introduced.
At the height of the problems, hundreds of Inland Revenue workers took part in a "spontaneous" walkout because of the extreme pressure they were under.
One call centre work said the conditions were "basically diabolical".
Ms Primarolo admitted to the committee that at the peak of the tax credit fiasco two million attempted calls a day were being made to the helpline and that it was still difficult to get through; "at certain times of day."
While the problems have subsided, some BBC News Online readers are still experiencing big problems.
Many people have had their payments stopped before they began because void notices were issued in error.
While other people who sent back their forms last year are still not getting payments.
But Ms Primarolo told the committee that everyone that had completed the tax credit form correctly by the deadline of 31 January was now being paid.
Overall, the minister said that 220,000 tax credit applicants were on work lists where the Inland Revenue was endeavouring to make further enquiries to establish eligibility for an award.
Ms Primarolo opened the Treasury Select Committee with an announcement that senior civil servants will be carrying out a root-and-branch review of how the Inland Revenue and HM Customs and Excise deal with tax policy and administration.
When asked if the review could lead to the merger of HM Customs and Excise and the Inland Revenue, the minister said: "Nothing has been ruled in or out."
The review will report to Treasury Ministers and be chaired by Gus O'Donnell, Permanent Secretary to the Treasury working with the revenue departments and their Chairmen.
What do you think about the new tax credits? Have you got your money? Or, are you are still waiting?
I do not understand why the government changed from the old working families tax credit system. The old one worked, you applied every 6 months so if your income changed it was only a few months before your credit changed. Applications were staggered, which gave the agency more time/resources to sort each individual application out. I applied last November, after several letters/phone calls I am still waiting.
Jane Heywood, England
We have *still* not managed to get an answer from the Tax Credit phone number 0845 300 3900. The best we have managed is the get the Tax Credits' recorded message and not the BT "System busy" one.
Although we are being paid our tax credits we can't report changed income this tax year, despite warning of it when we first claimed.
Ours was a web claim but you can't use the web to report changes.
Colin & Joye Rosenstiel, UK
My family have never seen me so worked up over something
Why means test 90% of parents when you can pay everyone and recover the difference through higher taxes on the richest 10% of parents?
My daughter was born early 2001 and after receiving a tax code change and a back payment as she was born in the previous tax year, my wife and I both received letters this year saying we weren't eligible as we didn't have a child! All the relevant paperwork had been filled in and returned. Fortunately we're not dependent on the money, but I can it can be very difficult for others.
If the government says there is no crisis, would Ms Primarolo like to pay me what I am due and claim it back herself ?
Robert Knight, UK
We've had our benefits cut from £679 per month to £65. We've appealed but had no response as yet. I have contacted my MP and will write to them everyday from now until eternity!
Josie Homer, England
I appealed against the tax credit awarded as I was unemployed through-out the whole of the tax year being used as a income measure.
The appeal was sent on the day the tax credit document was received and nothing has been heard since.
This was more than 2 months ago.
When will this appalling farce be rectified?
I applied last November, received a letter confirming acceptance of my form and I still haven't received anything. After numerous phone calls (many that tell me the lines are too busy and I get charged 5p for!) I received a note to tell me that I didn't have any qualifying children which surprised me somewhat as I thought I had two.
I tried registering for the internet service but that never worked and was eventually ditched (not that there were any helpful messages on screen to tell you this!).
I've eventually discovered that the problem has come about because my wife's date of birth was scanned in incorrectly. This in turn, meant that her details did not match the details on other benefit systems and so flagged a potential security problem (!!!).
As a result our credits were terminated. I assume no-one would have done anything if I hadn't been pestering.
Since then I have rung my local office and the general tax credit who both assured me that even though they can't change the details, they would send an urgent fax to the people who do. Guess what - still no payment!
A further phone call to someone else last week may have helped as they assured me they had actually changed the details on the screen but it would take 10 - 14 days to process (I don't know why either!) Seven of those days have passed and nothing received so far. I'm not hopeful.
My family have never seen me so worked up over something.
Fortunately, we can exist without the credits but others like me can't and it's a disgrace that so much effort is required to obtain what is rightly ours.
The chances of compensation are slim.
Someone's head should roll over this whole affair. I know that mine would if I underperformed and upset so many customers in this way.
Still, I live in hope that one day I might get my money .....
I submitted a web application at the end of March and prepared myself for a long wait. However, I was pleasantly surprised when my first payment reached my account on 15 May.
I applied in good order for the new credits in November of last year. In January I received a notification that my application had been received and that I would be sent a letter in due course informing me how much I have been awarded. I called the help desk last week for the first time to find out what is happening to my claim and to my surprise I got through to a lady first time. She took my NI Number and entered it into her computer, which told her that I had nothing on the screen. She told me not to worry, as it could be in between 'jobs', whatever that means. Call back next week she said. Oh yes, I have tried but I think that the rest of the country is trying as well. I have now been paying higher taxes since April this year and although I had a pay rise at the same time my take home pay is still less. Come on Tony, sort it out.
I am now receiving by credit, but only after trying to contact the helpline 0845 300 3900 constantly for over 4 weeks. I then phoned my local tax office who were able to tell me the progress of my application and what date I could expect my first payment. I found the local tax office very helpful and pleasant and also got through the first time I called.
Laura Champion, England
Well it's now then end of June, we submitted our application in April, but we haven't even received an award notice. You can never get through to the helpline, except when their computers are down (which is fairly often) - I've been trying for 6 weeks!
As a serving member of the British forces, i am currently operating overseas. I put in for the tax credit last October, received one small payment and then had them suspended. Since then, I cannot get anyone to answer the phone, I have written but received no reply and all this 3000 miles away. How frustrating is that - I suspect there would be no communication problems if they wanted money off me!!
Andy, Middle East
After reading all the stories about the IR fiasco, I would recommend anyone who cannot get through to contact their local IR office. I've managed to get them to work out my award and have had 2 x 5 week payments from them by Giro. They have also sent off another claim for me because I was told that I didn't fit the criteria i.e. more than 16 hours in work a week and children of the right age. Short of actually taking my children to the office, I don't know how to convince them. I was eligible under the old system so what do they think I've done with my children?
Why are the government handing out 'tax credits' to 90% of parents? Why not just take less tax from them in the first place. They already collect income tax at source and so the cost of this would almost nil as opposed to the huge amount of money that the current system has and is wasting. One of the arguments is that the money needs to be paid directly to the main 'child carer'. However, when filling in the form the household is treated as a family unit as far as income is concerned. Therefore why can they not be treated as a family unit as far as payments are concerned?
It's about time the Government realised that there is no point telling us that black is white when we can clearly see for ourselves that is it black !
There is a problem with tax credits - if there wasn't it wouldn't be so damned near impossible to contact the helpline. I cannot believe the recorded message (that's as far as I've ever got with getting through) telling us that the delay is three WEEKS. This is simply not true in most peoples experience. I submitted an internet application in March and there has been no reply whatsoever. Thus I must keep ringing just to check if the application has actually been received. If the Inland Revenue was just able to send a short one line letter confirming receipt and giving a real estimate of the processing delay, me and countless others wouldn't keep ringing and blocking the phone lines and the poor staff who have to try to resolve this mess could get on with it.
Chris Tooze, England
If you have problems getting a response contact your MP. Their staff can follow up queries directly and don't have to go through the call system that the public does.
If everybody who can't get a satisfactory response went to their MP then the real size of the problem would be immediately apparent to them
I applied at the first opportunity for the child tax credit. I received a reply in November stating that my claim had been received and I would be contacted if any further details were required. I was actually reassured by this but six months later I was requested to resubmit my claim because my salary details were incorrect. Aren't these the same people that deal with tax and salaries? eight weeks later I am still waiting for a reply. Throughout this whole saga I have tried in vain to contact them by telephone.
To be honest we have been pleasantly surprised by the competence of the new scheme. I filled in the forms on line in 2002, and we rec'd early notification and payment on time in 2003. Our circumstances then changed, we notified them and our payments changed, all handled very promptly and efficiently without any chasing by us. We were pleasantly surprised by the amount we are getting as well, working out a lot more than we had anticipated. So its a well done from our family!
I have been paid the tax credit for what its worth. This year I received a 3% pay rise and my take home pay reduced by £60 because of the 1% NI and the reduction in my tax allowance from 7000 to 4000. I receive £40 in return.
A fair exchange ?
I think not
and who is the real winner ? the family or Gordon Brown ?
I submitted a web application in March but have heard nothing whatsoever to date.
I have recently tried calling the Tax Credit Helpline (there is no query facility with the on-line system)but have only received recorded messages stating that "applications currently take 3 weeks to process" (so what's happened to mine?!) and that "all are lines are currently busy - please try again later". I daren't even hope at this stage that I'll be able to report a change of income at any time in the near future.
David F., GB
Still no response to an application made last year despite contacting my MP! I hope that everyone caught up in this farce will let this government know what they think at the ballot box two years from now.
Tony Rawlings, England
Beware all of you who thinks the tax credits are great value, I thought so too until I was told, after waiting 6 months, that they had worked them out wrongly and I'd have to pay back £2,500. I am allowed to pay it back monthly leaving me £100 a month worse off! They should just take less tax from us instead of making us go through months of rigmarole for nothing! I wish I'd never bothered!
Seven months after submitting my child tax credit application the tax arrived in my wife's bank account on yesterday. However this took 50 phone calls at a cost of £5 which did not move things on at all. I then wrote to my MP who could not get through on the special MP's hotline. My MP then wrote a letter to the Inland Revenue which belatedly provided a response that promised an answer in 15 working days. This deadline passed so I personally visited my local tax office, Redhill, who were very helpful, as always and provided a emergency payment as the IR system showed my claim was awaiting payment but a "permanent system error" prevented this. I then sent copies of all my correspondence, MP letters etc. to the IR Director of Customer Service and lo and behold two working days later the back payment arrives. The helpline people are powerless but my MP, his PA and the local tax office were extremely efficient. I have never come across such inefficiency in my 44 years. ! If this was a commercial company they would be out of business by now.
Graham M. Smith,
I like many other people claimed for CTC and WTC in 2002. Then early 2003 my circumstances changed and I notified them. It has taken untold phone calls, letters, Visits to local Inland Revenue and finally after contacting my local MP I have received the benefits that I am due. I am disgusted to think that it has taken months to sort this out and consider myself lucky to be getting money now when I now other's are still waiting.
Leanne Head, England
"But Ms Primarolo told the committee that everyone that had completed the tax credit form correctly by the deadline of 31 January was now being paid."
Well we haven't got ours and we completed CORRECTLY and sent in our claim form in Nov 2002. I was told in March that our details were correct and there should be no problem with payment !!!!! What do you say to that Ms Primarolo?
Mark Potter, England
I am absolutely appalled by this whole business. Our application went in before Christmas and we have still not received any payment on 7th July. Someone needs to sort this mess out as a matter of urgency.
Andy Macnair, uk