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Last Updated: Saturday, 25 March 2006, 11:22 GMT
Have Your Say: PC scheme scrapped
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Half a million people took advantage of generous tax breaks

Two thousand people could lose their jobs after the chancellor pulled the plug on a scheme to help employees get a home computer.

The tax break aimed at improving computing skills has been available since 1999 under the Home Computer Initiative (HCI).

The Budget move means the 60 companies which supply the computers and run the schemes will have no income.

But the Treasury told the programme it had clear evidence the tax advantages of the scheme were being abused.

We asked for your comments and experiences of the scheme. Below is a selection of your comments. This debate is now closed.


Does this government really have no idea how long it takes a business to adapt to out-of-the-blue tax changes? A business needs a year's notice of these kind of changes to adapt.
Will

There is no way I could have afforded a laptop outright unless I saved up for years
Steve Clough, Portslade
I took part in my employer's scheme last July and was hoping to again in three years time. Bang goes that idea! I have been very happy with it.

There is no way I could have afforded a laptop outright unless I saved up for years. A small monthly payment from pay which I do not miss was great.

I am a Labour supporter but am increasingly finding their decisions daft.
Steve Clough, Portslade

We have this scheme at my company. The deals on offer are not very good, although they are cheaper than the high street. The deals offered to our company are all high cost machines so only the higher paid members of staff can afford the deduction.

The scheme does not work. However, 10 days notice to the current set of HCI providers is despicable. If this scheme is to be replaced in order to better bridge the digital divide, the industry deserves more notice.
Chris, Cambridge

There are lots of comments here about how the machines were more expensive than buying on the web. But the machines were just part of it, and the real value was in the continuing education. I have a group of friends and family that I tutor unofficially, and whose PC systems I maintain, because the cost of learning and maintaining a PC system is much more than the initial outlay.

This is important for any industrialised country
Marc, US
If the programme was able to educate people into becoming more self-sufficient online and in general computing, then it certainly should not be cancelled. This is important for any industrialised country. You need computer-literate people at all levels in the workforce!

It is incredibly hard to teach people about PCs in an unstructured environment, long-term constant exposure is the only way.
Marc, US

I was involved in looking at the feasibility of this scheme for my employer who had over 1000 staff, as I not only have over 25 years of computer experience, but I am very familiar with current pricing structures.

I found the HCI scheme could be beneficial to the few who could purchase a PC of choice from supplier of choice, but I felt those companies set-up to specialise in HCI were ripping off employees, and effectively using employers to generate sales.

I found there was no option not to take insurance and training in the schemes I investigated, not to mention high interest rates.

Thus at the end of the day, a PC was more expensive than if bought from a high street store, not to mention the interest-free credit deals available from such stores.

In the interests of the general public, I'm glad the scheme is closed down at the HCI companies can no longer profit from others lack of computer knowledge.
Joe Maceo, Edinburgh

This is an abuse by government! The industry had opened up in response to the government's requests, and lots of providers were offering systems cheaper than retail before the tax savings. Those that say the equipment was dearer have either not compared the specs or chosen a good supplier.

I have now lost my life savings and my home
Steven Briggs, Leeds
I was a provider and believed in the objectives of the scheme. I have now lost my life savings and my home. I have offices I cannot pay for and staff to be made redundant. All that for helping out to bridge the digital divide.

Most of our participants were factory workers that could get a PC paid for over three years for less than 3 a week.
Steven Briggs, Leeds

I am very concerned at the complete arrogance of the chancellor by doing such a u-turn without even consulting the DTI or the TUC.

HCI employs over 2000 people and the scheme has successfully hit all the key government objectives, such as the uptake being successful in targeting 75% lower tax payers, 60% of which are blue-collar workers. I am staggered as to the policy objective.

Whilst the Treasury criticises so-called "abuse" of the system it should take responsibility for a scheme it created in partnership with industry and seek a compromise that secures 2000 jobs.

Maybe the chancellor has got his sights on higher office; but he certainly should not be getting complacent about the day job!
D Siequien, London

I was glad to hear of the death of this scheme. My employer offers it so I have studied it. Thousands of my fellow employees took up the offer.

Buying a computer can be a con at the best of times. It doesn't help when your employer is part of the con
Ian McRobert, Peterboroug
It is an incredibly bad bargain even with the tax "advantages". You could walk into a PC store and pick up a better computer system for less money, never mind finding even better prices on the web.

Buying a computer can be a con at the best of times. It doesn't help when your employer is part of the con.
Ian McRobert, Peterborough

I'm sad to hear this. I was hoping to take advantage of the scheme this year. At present I have to stay at work late or visit a public library if I want to do personal work or develop my IT skills.
T May, Cambridge

I agree that there should be a system that supplies home computers for people to increase their job competency.

What I don't agree with is the fact that the computers do not come with lessons or private tutoring!
Marios Constantinou, Leamington Spa

A laudable aim but poorly implemented in that end-users got poor value, and the taxpayer even worse value. The net effect meant that taxpayer's money was going to sponging middlemen and foreign commercial interests.
Laurence

150m on subsidising mainly middle-class people? It's indefensible and it should be scrapped.

Those that set up this get-rich-quick tax scam have got burnt, and they deserve it
Richard Bunning, Devon
The money is needed for education and health. Why aren't TVs or mobile phones subsidised? Why PCs? The reality is most PCs are used for games, and access to porn, not learning!

Those that set up this get-rich-quick tax scam have got burnt, and they deserve it.
Richard Bunning, Devon

Looking at the bigger picture, the sudden change of tax policy without any warning is indicative of a government with no understanding of the business cycle or the amount of investment and resources that starting anything involves.

The fact that this move has cost 2000 people their jobs seems to be of no interest to Gordon Brown.
Andrew Wright, Surrey

Yet more proof that the champagne socialists of Downing Street really do hate poor people, as if any more were needed.

Ten days notice to quit. That's how caring and sharing this Labour government really is.

Have you noticed how it treats its own people who commit all kinds of wrongs? It gives them a lump-sum gift as they leave their job and then invites them back a couple of months later when the heat is off!

Contrast this with what do it does to poor people trying to get on the technology ladder? Socialists really hate poor people. They've just proved it again!
John Morris, US

In Sweden [I think] almost nine out of 10 computers are bought by their HCI system. Why doesn't the government here just grow up and stop being afraid of doing things properly in case they tread on the toes of big business?

It's probably cost millions to set up and close down, whereas what it should have done is just set it up and advertised it properly instead of sticking money into useless training systems like Learndirect which in my experience was bordering in useless.

I would have been much better off spending the cash on a cheap computer via HCI and learning at home from a book.
Mark Chambers, Manchester

The industry that has been dealt this devastating blow mostly comprises of little guys like you and me. Because these resellers specialise in IT they were offering great value such as full 24/7 support at 45 for 3 years: a fraction of the High Street cost.

This has very far reaching consequences for the future of many people
Rob Howes, BizApp Ltd
We developed a web application at a cost of around 500,000 and it's now useless. The team of six, who built it, will lose their jobs. I as an entrepreneur have just had my business wiped out with very great personal loss.

My salary during this development was barely minimum wage, so I'm by no means a fat cat.

This has very far reaching consequences for the future of many people.

The Treasury is claiming there was misuse, but this could have easily been rectified by insisting HCI providers were properly trained and certified as ours were.

The chancellor professes to have education as one of his main aims but is this limited to children? What about adults? What about IT skills and access to the greatest learning tool of all, the web?
Rob Howes, BizzApp Ltd

I too am the owner of a small IT firm specialising in HCI. Many of those criticising the scheme know little or nothing about it.

This scheme was excellent for people with poor IT literacy. Buying your first computer can be daunting and options on the high street expensive. Those without a home PC rarely shop online and inexperienced buyers can be ripped off with support and warranty options, high APR and costly repairs.

My business may well now close with the loss of 15 jobs at only 10 days notice
Stuart Macdonald, Glasgow
Some 40% of the homes in the UK are still without a PC. And many with a PC are still not using broadband. IT literacy increased enormously in Scandinavia thanks to HCI where Finland in particular has greatly skilled its workforce.

My business may well now close with the loss of 15 jobs at only 10 days notice.

I urge everyone to petition to extend the scheme - if only to allow the companies employing some 2000 staff across the UK to wind down over a sensible period of notice.
Stuart Macdonald, Glasgow

I got the laptop I am writing this comment on from my company's HCI scheme, and I was glad to be offered the chance. I paid about 36 a month, and have received a very good service from the supplier my company chose.

I received my laptop in May, and two weeks later suffered my first MS flare, and was off work for three months. Not having a computer doing this time would have made my life very difficult, as at that point I wouldn't have been able to buy one outright, or afford an expensive loan.

Through having the computer I maintained my link with the outside world, banking, getting shopping delivered, and keeping myself from going nuts from being homebound.
Jaki Jordan, Norwich

I wanted to buy a computer but the range was small and the choices limited.

I know a fair amount about computers and the choices we were being offered were very poor.

I would like to see the scheme continue, but why can't we choose where we buy these products?
Mark Epstein, Manchester
To my knowledge, none of the staff I work with took this offer up.

The scheme seems to have been hijacked by companies who are more interested in making money than offering the best deal to those for whom it is designed to benefit.

I would like to see the scheme continue, but why can't we choose where we buy these products?
Mark Epstein, Manchester

Let's face it. Brown is not fit to run the country. This is based on years of watching him manipulate the Budget in order to make himself look good.

The true masters of the economy are the US Federal Bank, The European Central Bank, and the Bank of England. These are the organisations responsible for the economic growth of the West.

Brown can't do anything to fix these organisations as they are independent, so he fiddles with the man-on-the-street's finances in order to make sure the electorate he cares about that year get the best deal.

Hopefully people will wake up to this con-artist and not give him the chance to mess even more up as prime minister.
Kevin B, London

My company's main client is an HCI provider. They use my company to provide software to help people develop their customers' ICT skills and to encourage them to get online.

The HCI provider has prided themselves on developing the ICT literacy and providing computers at affordable prices to members of society that normally would not be able to benefit from this technology.

The lack of notice has given us no ability to adapt
Callum Rimmer, Bath
Over 70% of the customers that our company dealt with (through HCI) were basic-rate tax payers, many of whom worked in the NHS and other worthwhile public sector bodies.

The chancellor has finished their business and potentially my business by removing this tax break. The lack of notice has given us no ability to adapt.
Callum Rimmer, Bath

I was hoping to take part in the scheme. I don't know what computers would have been on offer, but after reading Ian McRobert's comment's, I don't feel so annoyed about losing the opportunity.
Alan Thomas, Bridgend, Wales

The popularity of this scheme is testament to the value that it provided UK employees. To stop it with just a few weeks notice is just another example of the dictatorship style of government we live under. Roll on the next general election and goodbye Blair and Brown!
Paul Davies, Swansea

I took advantage of this scheme 18 months ago to buy a laptop for my daughter's degree studies. The three year lease period with full support gave me peace of mind that the laptop would be repaired free of charge if broken.

I have been impressed with the scheme and hoped to buy one for myself, when the current scheme was completed.

As for cost, yes it is comparable with a PC bought on the High St or on the net, but you do have the three years of full warranty and support inside the price. Real peace of mind for novices just starting out.

Shame on you Gordon Brown!
Jim

One must assume that the government made this decision in haste. One must never underestimate how important it is for people to be educated in the use of technology, in order to function in a commercial marketplace.

The long-term effects of this decision far outweigh the short-term savings
Andy, Windsor
These are the people my company has served through provision of PC Support in HCI, and many of them are the people who voted for this government. Has the government forgotten why it started HCI? And does it truly understand why it has scrapped it?

The long-term effects of this decision far outweigh the short-term savings. Ironically, in the bigger picture, the short-term tax savings on which this Budget was declared, will be dwarfed by the negative effect of the elimination of the HCI community.

If this country is to prosper from a thriving private sector, the government should contribute where employees do not have the ability to provide the educational tools for themselves!
Andy, Windsor

I co-ordinate the scheme for my employer and I am not surprised that the government has pulled the scheme. I am amazed however that it gave so little notice.

I agreed the launch date of 12 April in February with the supplier, and on the Friday before the Budget announcement agreed to have nearly 4,000 brochures printed.

I cannot believe that the government was so short-sighted and didn't consider the effect of giving no notice to all concerned before the announcement.
Laura Kavanagh

I'm not too sad about the demise of HCI. I haven't been able to benefit from it myself, though I'd have liked to.

The closest my colleagues and I got to benefiting from this scheme was when our HR department sent by e-mail, a link to the website of a third party company that claimed to be able to provide computers under the terms of HCI.

The PCs... seemed to cost more than buying direct from the manufacturer
Jerry Bakewell, London
On closer investigation though, it turned out that the prices quoted for comparison on this website were way above what they could be. Even once the mysterious tax calculations were factored-in, the PCs on offer still seemed to cost more than buying direct from the manufacturer.

When this suspicious pricing policy was pointed out to the administrator who had announced this scheme, another e-mail was quickly sent out insisting that no recommendation by the university should be inferred from the fact that they had e-mailed everyone a link to it!

And that was the last we heard of it: entitled to a modest tax break, but actually left in limbo between a grasping and opportunistic, supplier, and an administration too apathetic or incompetent to sort out anything of real value.
Jerry Bakewell, London

The Treasury keeps claiming it has evidence of abuse, but have not produced the evidence. This is clearly a case of the government retro-fitting excuses to fit a last-minute decision that was made to "balance the books".
Simon Dawson,

Another example of a dysfunctional government: the DTI is about to run a scheme for its staff and the Treasury pulls the plug on the whole thing. It would be funny if it wasn't so serious!
Graham, Bath

As the owner of a small IT company who was involved with HCI, I am concerned that many of the comments suggest the schemes were bad value.

All I can say to this is that it was up to your employer to find an HCI provider which offered a good range of products and prices which weren't highly inflated.

HCI was the cheapest and best way to purchase a computer
Sam Dean
Yes I agree, if you look around you can get good deals via the internet, but then they may charge you 20% APR over three years, may only come with a one year warranty and have support lines that are premium rate numbers.

If you take this into account, HCI was the cheapest and best way to purchase a computer.

This scheme was for low-income families that couldn't afford to purchase outright and had little knowledge of IT.

Will the price of a PC increase because of the closure of HCI?
Sam Dean

Although I would like to have taken advantage of the scheme, it should not have been introduced in the first place.

Having been introduced, there should have been more notice that it was ending.

If removing such tax breaks were a move towards simplifying the tax system, the ending of the scheme should be welcomed. Unfortunately that is not the case.

The introduction and removal of such a scheme is just part of Mr Brown's continuing fiddling with the tax system.

With any such scheme, the loser is everybody else due to the tax loss that has to be made up.

Everybody also loses out due to the indirect cost of introducing and then removing such schemes.
Peter, Cambridge

On the day I was told I was being made redundant I had a brochure from a firm, inviting me as a "valued employee" to take part in this computer scheme.

I'm glad that this scheme has closed since it offered no benefits to those it was intended to help
James, Oxford
Overall, after looking through I found the computers on offer to be no less expensive than the open market and the tax and NI rebates weren't of any benefit since you had to agree to pay a monthly charge for "computer help and assistance" from the company behind the scheme.

I'm glad that this scheme has closed since it offered no benefits to those it was intended to help and was being exploited by those who didn't need help.
James, Oxford

This decision will damage the education prospects for hundreds of thousands of children and employees across the UK who find the cost of home computing unaffordable.

If this Budget is being hailed by the chancellor as a boost for education, then it will fall well short of the mark as a result of this decision.
Trevor Finlay, Belfast

The lack of notice given by the chancellor for the unwinding of this incentive is appalling.

Up to two months ago the DWP was encouraging employers to offer these schemes. It was a means of encouraging computer use and confidence.

Employees are increasingly faced with having to use computers in their workplace and this scheme allowed them to practice in their own homes.
John Lewis, Dinas Powys


The comments we publish are not necessarily the views of the BBC but will reflect the balance of views we have received. It is helpful if contributors state if they work for any organisation relevant to an issue discussed. Readers should form their own views on whether messages published represent undeclared interests, or views prompted by a common source.



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SEE ALSO:
Budget move imperils 2,000 jobs
25 Mar 06 |  Moneybox
Budget blow to home computers
22 Mar 06 |  Business
PCs at home make 'better workers'
19 Jan 04 |  Technology


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