In the Commons this week, Stuart C. McDonald, SNP MP for Cumbernauld, Kilsyth and Kirkintilloch East, obtained an adjournment debate to highlight what he calls HMRC’s ‘disastrous’ proposals to close Cumbernauld tax office.
The SNP manifesto called for a reconsidering of HMRC’s Building Our Future programme, questioning its logic of closures and axing of jobs when the tax gap in the UK is £35 billion. It also said that the consequences of Brexit will put greater demands on HMRC. The Government in response claim that at 5.6 per cent, the tax gap is not only near to its historic low in this country but low against international comparators and ‘HMRC remains an extremely efficient tax collection agency’.
In his Commons speech McDonald said the closure of the Cumbernauld office will be a ‘huge’ blow to the workers there, many of whom have given decades of service, and many of whom will not be able to transfer to the Glasgow office for a variety of reasons. He estimates 1,700 or so workers will not be able to make that transition at all.
McDonald said the scale of the changes and cuts faced by HMRC have been ‘extraordinary’. When it was formed in 2005, HMRC had 96,000 full-time equivalent members of staff in 593 offices; less than a decade later, staff numbers had fallen to below 60,000 based in fewer than 190 offices, he said. HMRC’s Building our future programme set out to close 137 of those offices, and to centralise even fewer workers in 13 large regional hubs with between 1,200 and 6,000 staff. It seems that HMRC will shed many thousand more jobs during this process, with tens of thousands having to move location.
The SNP MP went on to say that ‘serious issues’ have been thrown up even where regional hubs have already opened. For example, in Norwich, despite emphasis being placed on proximity to universities for recruitment purposes, recruitment has apparently proved incredibly difficult, he said. Not only are many existing staff choosing not to make the switch to the new hub, but the hoped-for recruitment of new graduates has not materialised.
McDonald complained that the Government has been rather less keen on bringing this issue to the House for scrutiny and debate. Even when the original list of sites to be closed was decided, no announcement was made to the House. He claimed that the Treasury had shown a total lack of interest in the whole issue of reform of HMRC’s estate and workforce. Morale and job satisfaction among the HMRC workforce remains among the lowest in the civil service, he added.
On Cumbernauld, McDonald said the new site in Glasgow has a maximum capacity of 3,000 compared with a full-time equivalent workforce of 4,700 at the sites that are earmarked for closure. 57 per cent of staff earn less than £20,000 a year. If, as has been estimated, staff will have to spend, on average, an additional £17 each week on travel to work at the new regional hub in Glasgow, that will represent five per cent of their take-home pay. A conservative estimate suggests an annual loss of almost £1 million at supermarkets, local cafés and food outlets alone around the existing site in Cumbernauld.
Dr Lisa Cameron (also SNP) said HMRC’s plans to move the hubs to city locations are counterproductive and undermine the Government’s own agenda to try to support development in towns.
Tax Minister Jesse Norman said HMRC is seeking to bring its estate towards a more consistent and better integrated network of large, modern regional hubs, and to do so in the interests of its workforce who deserve a modern workplace in which to work and thrive. With any relocation there will be people who disagree with it, he added. HMRC is seeking to use the benefits of the city: the capacity to agglomerate services and bring people together, and give them proper communications and technology support.
The minister said that the overall HMRC programme will deliver savings to the taxpayer of around £300 million up to 2025 and then rising cash savings, estimated to be more than £90 million by 2028. It also avoids additional costs of £75 million a year from 2021, when the current PFI contract with Mapeley, agreed by the last Labour Government, comes to an end.
The full session is here.