The Government is to change the law to require the banks and private companies to hand over details of earnings by millions on out-of-work benefits and tax credits. The scheme will eventually be extended to cover all people in work, allowing HM Revenue and Customs (HMRC) to reduce the massive errors seen in the tax system in recent years. Access all areas: The scheme will eventually be extended to cover all people in work, allowing HM Revenue and Customs (HMRC) to reduce the massive errors seen in the tax system in recent years One said: ‘About 94 per cent of employees and 97 per cent of benefit recipients get their earnings or benefits through the banking system – it contains all the data we need. ‘This does not involve us receiving new information, but it does involve us getting it in a more timely manner and in a way that is easier to use in reducing fraud and error. ‘It will catch out people who are not reporting a change in their circumstances, and make it easier to identify people who are saying different things to HMRC and the Department for Work and Pensions (DWP) to maximise their tax credits and benefits.’ The scheme, due to be phased in during the next three years, will involve a ‘massive data-matching exercise’ to cross-check payments made to benefit recipients against their declared earnings. HMRC already receives details on earnings from companies on an annual basis through the pay-as-you-earn (PAYE) system. Meanwhile, the DWP holds information on payments made and declared earnings of all benefit recipients. But there is currently no system to link the two. Under the new proposals, the banks will be ordered to allow officials access to details of payments made through the banking system. Employers will also be required to hand over payroll details each month, rather than on an annual basis. Much of the error in the benefits system relates to the time lag in officials receiving information about changes in a person’s circumstances, such as a new job, extra overtime or a new partner. In many cases overpayments of tax credits and benefits continue to rack up for months, resulting in huge sums which can never be recovered. At least six million people have recently been told they have paid the wrong amount of tax because of errors in the existing system, and the final figure could be as high as 15million. A Government source said: ‘Having information on a monthly basis will allow HMRC to keep track of what is going on with people’s earnings and allow it to adjust tax codes more quickly.’ Whitehall's monthly audit More transparent: Danny Alexander said plants to improve accountability in Whitehall represented a 'quiet revolution' Whitehall departments will be forced to publish month by month plans of their activity to improve accountability, the Prime Minister will say today. David Cameron will unveil plans for a ‘power shift’ designed to make Government more transparent. He will present it as an alternative to Labour’s target culture, which he argues encouraged short-term thinking and distorted priorities. Ministers who fail to deliver agreed reforms and savings will be required to write a public letter to Mr Cameron explaining the poor performance. Treasury Chief Secretary Danny Alexander said the proposals represented a ‘quiet revolution’ in the way government works.We're going after all your bank details:
Ministers demand earnings figures in crackdown on welfare fraud
Explore more:
Monday, 8 November 2010
we told you years ago remember "ECONOMIC TERRORISTS"
Last updated at 9:49 AM on 8th November 2010
The move is likely to raise concerns about both privacy and data security, but
Whitehall sources insisted last night that all the information involved is already supposed to be passed to the Government.
Posts
