Concentrix Tax Credits Crisis: Government Secretly Tripled Payments To Failing Contractor

Concentrix Tax Credits Crisis: Government Secretly Tripled Payments To Failing Contractor

Jan 18, 2017, 3:00:00 PM News

The UK National Audit Office has published a report today revealing how  £32.5million of public money was paid to a failing tax credits firm which wrongly stripped thousands of families of vital benefits.

HM Revenue and Customs bosses agreed secretly to treble the commission paid to bungling contractor Concentrix despite its disastrous performance, Government auditors found

This included  cash payments of around £7million for cases in which families incorrectly had their payments stopped and had to overturn the decision on appeal,

In September 2016 following a grass-roots Facebook campaign organised by parents that were suffering at the hands of Concentrix, the Government  unexpectedly announced that HMRC would not renew the contract with Concentrix.

Cases picked up by mainstream media  highlighted how a teenage mother had her Tax Credit’s stopped because she was accused of being in a relationship with a dead pensioner. When Concentrix were informed of this, she was told that Mr Deceased still needed to contact Concentrix, to confirm his new address.

Another mother was accused of having an ongoing relationship with “McColl’s”, a chain of high street news agents .

Welcome to the Kafkaesque twilight zone, brought to you courtesy of Concentrix and the payment by results approach to welfare.


Last August, inbetween the summer holiday and back to school Facebook statuses, a series of alarming posts began popping into my news feed:

“I’m struggling with skipping meals and being diabetic, my blood sugar is dipping a lot, is anyone else managing this?”

“three children and been living off hardly anything for 5 weeks, accused me of living with the previous tenant, now got to take the kids to the other side of the city to stand and wait for the food bank”

“we are literally living off nothing and the electricity was off all of last night, in the dark with the kids”.

These are just  some examples of the hundreds of posts that were being sent to the Concentrix Mum’s Facebook page.

A member of the group myself, I had initially found the page to be a source of advice and sanctuary after my dealings with Concentrix earlier in the year.

In February, I had returned from a long day at work to find a letter from Concentrix sitting on the doormat. The letter stated that they had “evidence to suggest you may be living with someone” . Who, I had no idea. Concentrix don’t tell you in the letter. You have to be assertive and confident enough of your rights on the phone to find that information out.

Concentrix operate by purchasing third-party data from credit agencies and electoral rolls.  Invariably, this carries anomalies that mean former tenants, landlords, ex partners and even neighbours can show up on systems as having links to addresses. The letter gives the claimant 30 days to produce and send evidence of every bank transaction they have made for the past year, copies of all utility bills as well as an array of other personal information. The logic is that you must “prove” you are single by means of mass data gathering. Between 2014 and 2016 an estimated 1 million letters like this were sent out by Concentrix, “phishing” for data from single parents.

In most cases it seemed that if you could jump successfully through the data gathering hoops, Concentrix would then accept that you didn’t have the former tenant (in my case) living in the airing cupboard.

At some point during the summer,  the goal posts  moved.

Every day, new members were arriving in the group and wit stories  that  grew more shocking.

Without warning, parents  were discovering that their Tax Credits just suddenly stopped one day. This in turn, then triggered  Housing Benefit to stop.

As parents desperately tried to contact Concentrix, they were met with engaged tones . If they did manage to get through, the standard response was to be advised that it could take “up to 12 weeks” for a case to be looked at. HMRC refused to take responsibility for Concentrix.

Within weeks, thousands of people embroiled in the crisis had run out of food, money and  used up quotas for maximum visits allowed to food banks. As a direct result of the actions of  Concentrix, in 2016 there were mother’s and father’s in Britain who were literally unable to buy bread, electricity or school uniform. Childcare  providers went unpaid as people effected could in some cases no longer afford to go to work. Job’s, tenancies and basic survival all now hung in the balance.

An unaccountable private firm had stripped financially vulnerable people of the ability to provide for their children’s basic needs; in the name of a payment by results incentives game.

In the wake of the crisis,  The Concentrix Mum’s group  set up a crisis support fund for food shopping. Across the length and breadth of Britain, mother’s were helping other mother’s to put food on the table for children,  whilst the government and Concentrix did nothing.

Members of the group got the hashtag #Concentrixputtingfamiliesintopoverty onto Twitter. The story began to get picked up by Martin Lewis from Money Saving Expert, MP’s  and the BBC’s Victoria Derbyshire programme.

On the morning of  September 13th, The Victoria Derbyshire programme ultimately gave a damning expose of what was taking place.

The Work and Pensions Select Committee held earlier this month on October 13th, heard from claimants, HMRC and Concentrix.

The Committee heard that as the crisis began to escalate in the week beginning 15th August 2016,  Concentrix were only able to answer 1% of calls.  The staff based in Dublin simply were not enough to handle the volume of calls coming in, generated by the number of claims that Concentrix had opened up. The Committee also heard the following;

  • In 73% of cases where people had all their money stopped, appeal decisions were made in favour of the claimant. Original decisions had therefore been flawed in many cases and driven families into unnecessary destitution
  • HMRC officials repeatedly talked about the “process” and “procedures” passing blame back to Concentrix. This narrative presented as being removed from the human consequences of what had gone on.
  • Refunds to those who had their benefits wrongly stopped were taking place in instalments over several months, resulting in escalating debts and subsequent incorrect decisions being made for Housing Benefit.

Labour MP Louise Haigh who has been outspoken in Parliament about the Concentrix scandal  from the outset,  has spoken again in Parliament highlighting the perverse structure of incentives that the company were working under.

Concentrix employees have claimed that far from acting as a rogue contractor,  HMRC were behind Concentrix at every step of the way. The directives of how many staff Concentrix would need came directly from HMRC. Alarmingly, as little as five hundred  staff were instructed to target over 2 million people, profiled as vulnerable.

I believe that the axe that was swiftly brought down on the Concentrix contract, represented  an attempt by HMRC to abdicate any responsibility for the mess and suffering caused.  Moreover, it also feels indicative of the Theresa May government wanting to politically distance themselves from the overtly mendacious attacks on low earners and “strivers” that became the trade mark of George Osbourne.

With the Brexit vote and public defiance of his message signalling the end of Osbourne’s career as Chancellor, the Tories could no longer tell themselves that Dickensian attacks on the working poor will not have consequences at the ballot box.

The revelations today further  highlight the  chaos, contradiction and disregard for human misery that the previous Tory government presided over.




Published by Natalie Fox

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