Friday 12 February 2016

Trust in the Civil Service 3

Sir Jeremy Heywood, Cabinet Secretary and Head of the Civil Service, wishes to increase the level of trust placed by the public in the civil service. As we have seen, here and here.

His chosen method to achieve this objective centres on перестро́йка and гла́сность, i.e. perestroika and glasnost, or innovative transformation and openness, to be delivered by the Government Digital Service (GDS).

We have identified certain problems with the strategy. Among others:
  • GDS have promised the public that we can use GOV.UK Verify (RIP), the replacement for the Home Office's failed ID cards scheme, to establish our identity on-line and that we can use that identity to access public services. GDS's business partner, OIX, the Open Identity Exchange, tell us that GOV.UK Verify (RIP) is having trouble achieving the requisite level of assurance that people are who they say they are. Which means that relying parties like the Department for Work and Pensions would be irresponsible to rely on GOV.UK Verify (RIP) when they pay benefits, for example, or pensions. GDS's false promise is more likely to destroy trust in the civil service than to inspire it.
  • In September 2012, the Information Commissioner's Office published advice on data protection which included this: "We also recommend you ... use different passwords for separate systems and devices" (p.8). That was obviously good advice then and it still is, three-and-a-bit years later. You'll find the same advice given worldwide. Here's the US organisation, for example: "Have a different password for each online account". GDS want you to have a single GOV.UK Verify (RIP) password for all your accounts. They're more interested in convenience than in security. Which diminishes the trust anyone can place in them.
  • "All your accounts"? Surely that should be "all your public service accounts"? No. The GOV.UK Verify (RIP) literature generally says that the system is designed to make it easier for members of the public to access public services, e.g. "GOV.UK Verify [RIP] is the new way to prove who you are online, so you can use government services like viewing your driving licence or filing your tax". Less publicised, GDS are trying to interest the private sector in GOV.UK Verify (RIP). Not a shining example of гла́сность.
Sir Jeremy's trust problems aren't limited to GDS.

Her Majesty's Revenue and Customs (HMRC) want to maintain tax accounts for us all, on-line. The idea is that we should be able to check these accounts, having logged on with our GOV.UK Verify (RIP) identities, and then quickly confirm them, thereby cutting out the old-fashioned need to submit tax returns. As the Chancellor said in his November 2015 spending review:
1.8 A modern and reformed state

Building on the progress made over the last Parliament in public services, the government will introduce far-reaching reforms to create a more productive state, fit for the modern world. The Spending Review and Autumn Statement is taking action to:
  • ...
  • make the government simple to deal with by investing £1.8 billion in digital transformation, replacing tax returns with digital tax accounts, and building one simple payment mechanism for all central government services
  • ...
They do it in Estonia, where it takes a person only 19 seconds to complete their tax return because the Estonian Revenue already know everything about their financial affairs anyway:

Should you invest four minutes of your time in watching this BBC film? Yes.

So surely we can do the same in the UK, if only we trust our tax authority as implicitly as the Estonians trust theirs.

The Chancellor has been advised that this is simply a matter of "building on the progress made over the last Parliament in public services".

Let's look at a relevant example – HMRC's introduction in the 2010-15 parliament of RTI, the real-time information system for PAYE/NI, i.e. pay-as-you-earn/national insurance. And let's look at the case of a company well known to DMossEsq which made a mistake one month.

This company, call it "X Limited", calculated the tax due for PAYE/NI Month 2, 6 May 2015 to 5 June 2015, submitted its RTI return on-line and paid the money due to HMRC on-line. All very modern. X Limited paid the money into the correct HMRC bank account. Good. Unfortunately, X Limited specified the wrong reference number.

HMRC had the money. But HMRC is a big place. And as a result of X Limited using the wrong reference number, the PAYE/NI people thought they didn't have the money. So they marked it down as a debt and started accruing interest on it. And five months later, X Limited received a letter telling them they owed HMRC lots of money.

X Limited telephoned HMRC, who agreed to re-allocate the money to the correct reference number.

End of problem?


Two months later, another letter arrived saying X Limited still owed HMRC money. There followed another telephone call, on which HMRC said:
  1. Yes, it can take two months to re-allocate money. Don't worry.
  2. And don't worry about the threatening letters you're about to receive, we can't stop them going out.
  3. And please don't look at your on-line RTI Current Position tax dashboard, the figures are all wrong, we're not letting any new companies see that account, we work from a snapshot.
  4. X Limited don't seem to have claimed their 2015-16 Employment Allowance to date. You should use HMRC's Basic PAYE Tools, which deducts the allowance automatically.
  5. Goodbye.
It turns out that X Limited do use HMRC's Basic PAYE Tools and that the company is flagged as eligible for Employment Allowance and that the entitlement is not automatically deducted from the PAYE/NI payable. So 4. is wrong.

5. is right.

1. is a big dent in the trust shield and needs to be sorted out by HMRC if Sir Jeremy is not to be embarrassed. It shouldn't take two months not to re-allocate money between two reference numbers in the same account. Nor should it take five months to notify the company of a debt. Not in the administration of a "productive state" that's been through years of перестро́йка to make it "fit for the modern world".

2. is another big dent, and it's also a lesson for the team working on GDS's new "platform", GOV.UK Notify. We don't want that turning into an out of control robot in whose processes no human can intervene, gaily accruing interest on non-existent debts while sending out threatening letters, emails, texts, tweets, ...

What about 3., you ask?

Here is X Limited's Current Position account for its n employees, maintained by HMRC, accessed on-line by X Limited, logged on through the Government Gateway because, of course, GOV.UK Verify (RIP) is incapable of identifying companies, which is an embarrassment Sir Jeremy is just going to have to live with:

There's an Amount due in period column. You'd think that that would match up with X Limited's RTI returns. Three of the non-zero figures shown match up and six don't. Ditto for the Amount paid in period column, three match, six don't and the £1,844.78 figure is particularly noteworthy as nothing was paid in that month, which is where we came in some time back.

Clearly, when HMRC's RTI people say "amount due", they don't mean amount due. And when they say "amount paid", they don't mean amount paid. Quite what they do mean is unclear ...

... but it wouldn't take you even 19 seconds to spot that the account is wrong. You wouldn't confirm the figures. And you wouldn't experience that Estonian rush of trust in HMRC that the Chancellor promises.

GDS have been promised £450 million over the next four years, no-one knows why, but it's unlikely they can help HMRC.

"The government will introduce far-reaching reforms to create a more productive state, fit for the modern world". The problems for Sir Jeremy are mounting up. What can he tell the Chancellor? HMRC. Companies House. GDS. They're all threatening the public's trust in the civil service.


Updated 18.2.16

Somewhere under its calm, elegant, swan-like exterior DMossEsq's webbed feet are paddling away. HMRC's, too.

The temptation to compare HMRC to GDS is strong. Too strong to resist.

Unlike GDS, HMRC actually respond to critical comment. We've seen that before. Now, once again, there have been helpful HMRC responses, this time in connection with X Limited's RTI problems, which may turn out to be quite substantially self-inflicted. Dénouement next week, possibly.

Meanwhile, GDS remain openly silent on the matter of their GOV.UK Verify (RIP) problems. They, and their business partner OIX, please see above.

Deaf to criticism, they now claim that GOV.UK Verify (RIP) could help the banks, rather than the other way round. Try this from Don Thibeau, the head of OIX, Digital Identity Across Borders:
Currently, around 50% of bank accounts opened in the UK are by people who ... lack sufficient footprint in the UK to open an account.
Come again?

GDS and OIX have somehow got the British Bankers' Association on board, please see Guest post: GOV.UK Verify [RIP], OIX and the future of banking. Let's see how long that lasts.

Updated 29.2.16
Good luck, Chancellor

We have a Budget coming up, on Wednesday 16 March 2016. The Chancellor may be expected to repeat his objective to "make the government simple to deal with by investing £1.8 billion in digital transformation, replacing tax returns with digital tax accounts, and building one simple payment mechanism for all central government services".

When it comes to "digital transformation in government", we were told two years ago by ex-Public Servant of the Year ex-Guardian man Mike Bracken CBE ex-CDO ex-CDO, ex-executive director of the Government Digital Service and ex-senior responsible owner of the pan-government identity assurance programme now known as "GOV.UK Verify (RIP)", "Estonia is a model for all of us".

Is it? Is Estonia a model for all of us? Are we really, all of us here in the UK, on the road to Estonia? Francis-now-Lord Maude went to Estonia, looking for the future. It is not clear that he found it, nor that the Chancellor will either. The latter might be well-advised to soft pedal on the virtues of "digital tax accounts" in his Budget speech.

The charming BBC film above may attract the Chancellor. The Estonian revenue service may be able to fill in people's tax returns for them and Estonians may be able to confirm their calculations in 19 seconds flat. You may have your doubts about that. But even after "the progress made over the last Parliament in public services" we are nowhere near achieving the 19 second tax return here in Blighty.

Nothing can alter the fact that at the moment HMRC's Current Position account, for example, please see above, does not reflect the current position. The Amount due shown is not always the amount due and the Amount paid shown is not always the amount paid. HMRC know that. The Chancellor should know it, too.

What can be altered is your apprehension of the problem, which began one month when X Limited paid its PAYE/NI bill into the right HMRC account with the wrong reference number.

Firstly, there is HMRC's response, which has been swift and effective. The large debt that HMRC thought was owed by X Limited has been extinguished. In fact, HMRC have informed X Limited that by Month 10 they had paid £2,010.40 more than HMRC thought was due.

Sorting it out required people to talk to each other. There is no provision for that in GDS's Estonian model for public services. GDS regard service providers and their parishioners talking to each other as failure. That doesn't work – the gap between the digital Current Position and the actual current position just gets bigger. HMRC understand that. GDS and the Chancellor should, too.

Second, there is the taxpayer. It's not all HMRC's fault. X Limited, in this case, made several spectacular mistakes. Among others:
  • Their Month 2 RTI payment was made 35 days after their Month 3 payment because it was only then that they realised that they hadn't paid the Month 2 salaries which they had notified HMRC about with their RTI return 63 days before.
  • Their Month 3 RTI payment is the one that had the wrong reference, it went into X Limited's Corporation Tax account instead of its RTI account. HMRC's Corporation Tax people knew that there was no Corporation Tax due so they immediately sent a cheque back to X Limited which X Limited immediately put in a file because they knew that HMRC didn't owe them any money. They then forgot about the cheque. It was never cashed. HMRC didn't realise that, which is why they thought that there was a debt and which is why the payment at first couldn't be re-allocated, please see above, ... and so the soap opera goes on.
The GDS stance is that we need more centralised and standardised computer systems. They want a centralised and standardised payment platform, GOV.UK Pay, and a centralised and standardised notification platform, GOV.UK Notify:
  • How is GDS's GOV.UK Pay going to stop X Limited paying money to HMRC with the wrong reference?
  • Ms Y at HMRC sorted out the whole goulash X Limited had created in no time.
  • How is GDS's GOV.UK Notify going to sort out this sort of problem on its own, with no human intervention?
HMRC have a century of experience dealing with the likes of X Limited. GDS don't. HMRC have seen it all before. GDS haven't.

"Good services are verbs", say GDS. And "punctuation can slow people down". Quite which problems these aphorisms of GDS's are the solution to is a matter of ludic debate but they're unlikely to get the Current Position account reconciled.

HMRC are interested in collecting revenue to fund public services.

And GDS?

GOV.UK Verify (RIP), GDS's identity assurance platform on which digital tax accounts (and much else) depend, is due to go live in a month's time, in April 2016. So what are GDS doing? They're re-writing it. They've found a new software engineering methodology, mob programming: "All the brilliant people working on the same thing, at the same time, in the same space, and on the same computer". That's what they're interested in. Good luck, Chancellor.

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