Is the tax credit system due for another revamp?
With news that fraud and errors in the UK tax credit system have risen to an unacceptable 8.6%, compared to the UK government's target of 5%, there are rumours of yet another revamp of the system. This is a system which has from day one had many problems from computer blips, to information blips to a total lack of control on monies which go out. There has always been a significant amount of fraud associated with a system which appears very difficult to follow and very difficult to administer.
There is no doubt that the idea behind the tax credit system, which is ultimately there to ensure each person in the UK has a set minimum income per annum, is well appreciated, the same cannot be said of the administration. We have literally seen tens of thousands of people over paid and underpaid by tens of thousands of pounds, debt collection agencies chasing up invalid debts and yet more financial pressure heaped upon tens of thousands of families in the UK.
The problem seems to be one of understanding and communication between the various departments of the UK government as well as a computer system which throws up too many anomalies and too many inaccuracies. Whether it would cost more to close down the tax credit system and start again or simply revamp and re-organise the current system is a question which has remained live for many years.
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