Government 'loses' £900m VAT debt in data transfer fiasco

Around £900m of unpaid VAT did not appear on HM Revenue and Customs debt case management system because of a failure to transfer data from the main VAT computer system, MPs have been told.

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Around £900m of unpaid VAT did not appear on HM Revenue and Customs debt case management system because of a failure to transfer data from the main VAT computer system, MPs have been told.

Edward Leigh, chair of the powerful Commons public accounts committee, highlighted a series of problems with major government IT projects in a parliamentary debate on the committee's inquiries

He told MPs: “We found that not all information on VAT debt recorded on the main VAT computer system had been transferred to the so-called trader register.

“That may appear to be an obscure point, but it meant that some £900m of debt failed to appear on the debt case management system. That is hardly a first-rate example of financial management by a department that should be at the forefront of such matters.”

Leigh cited evidence given to the committee earlier this month by Ian Taylor, a past president of the Chartered Institute of Purchasing and Supply who is now director of the centre for procurement performance at the Department for Education and Skills.

Taylor had told the PAC “that in his view, public sector people are every bit as skilled as those in the private sector, but the information systems in the public sector are so bad that no private sector firm could afford to put up with them. They would simply go out of business,” Leigh said.

The committee chair added: “They do not provide the data that public sector leaders need to manage effectively or to develop robust strategies for delivery.”

Leigh also hit back at the government after it attempted to deflect criticism of the NHS’s £12.4bn IT programme by claiming that a damning PAC report was based on “out of date” findings by the National Audit Office.

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