HMRC ends Concentrix contract over allegations of unfairly withheld benefits

HM Revenue and Customs (HMRC) will bring its handling of tax credits claims back in-house after complaints that Concentrix, the contractor to whom it outsourced the work, was unfairly denying complainants their money.

HMRC awarded Concentrix the £75m contract with a remit to crack down on incorrect and fraudulent claims, but reports emerged of claimants struggling to make ends meet after having their money withdrawn unfairly.

One woman, Nicola McKenzie, a 19-year-old single mother, said her benefits were stopped after Concentrix said their records showed that she was married to a deceased 74-year-old man who used to live in her house.

HMRC said it will bring the contract back in-house before its due end date of May 2017, and transfer the staff currently working for Concentrix.

In a statement, HMRC said: “As the work previously carried out by Concentrix moves back to HMRC this means, under the protection of employment regulations, Concentrix staff carrying out the work assigned to the HMRC contract will automatically transfer to HMRC.

“Those people moving to HMRC will be supported through further training, building on the improvements already delivered to the service we provide to our tax credits customers.”

A Concentrix spokesperson said: “This will provide permanent employment, offering job security to them well beyond the scheduled expiry of the contract in May 2017. We do not expect any forced redundancies as a result of this transfer.”

In a Westminster Hall debate on Concentrix on Tuesday, Fiona Mactaggart MP said the company had “bullied people who depend on tax credits and targeted single mothers”, and had a financial incentive to stop payments because it was paid by results.

She added: “The lives of my constituents, and the constituents of many Members here, have been made miserable by the cavalier way in which Concentrix has used the flimsiest of excuses to end tax credit claims, and by its shocking customer service, which has left claimants hanging on to telephone calls for hours without resolution.”

Mark Serwotka, general sectary of the PCS, said the union was delighted HMRC had decided to bring the work back in-house and, crucially, “has accepted our argument to protect the jobs of Concentrix staff by transferring them in to the department”.

“Sadly, this could all have been avoided and the fiasco is further evidence it is a false economy to hive off important public services,” he added.

Rebecca Long-Bailey MP, Labour’s chief secretary to the Treasury, said: “This government still has a lot of questions to answer about how this mess came about in the first place and why they were so slow to take action.”

She said Labour would call for an immediate investigation into the government’s handling of the Concentrix contract in Parliament next week.

(Image c. Joe Giddens from PA Wire/ Press Association Images)

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