In September we reported that HMRC would not be renewing its contract with Concentrix, the outside company it has been using to carry out checks on tax credit claims. The intention was that the contract would not be renewed beyond its scheduled expiry in May 2017.
HMRC has now announced that, instead, the Concentrix contract is being terminated with immediate effect, in November 2016.
The performance of Concentrix came in for substantial criticism from the outset, both in terms of service levels and the quality of its decision-making. Voluntary sector bodies and advice agencies reported that many claimants experienced considerable hardship as a result of incorrect decisions, and that there were serious problems in contacting Concentrix.
“We have agreed that it would be in both parties’ interests and those of tax credit customers to end the contract early.
“HMRC has secured £193m in estimated savings for the Exchequer, and the amount paid to Concentrix over the life of the contract has been around £32.5m.
“Around 250 Concentrix staff have transferred to HMRC and all 181,000 cases transferred from Concentrix to HMRC have been finalised. “
The National Audit Office is currently looking at the performance of Concentrix and how HMRC managed the contract.