Research and analysis

HMRC Stakeholder Research 2023

Published 17 July 2023

Research conducted by Yonder Consulting for HM Revenue and Customs in 2023.

Disclaimer: The views in this report are the authors’ own and do not necessarily reflect those of HM Revenue and Customs.

1. Introduction

1.1 Background

HM Revenue and Customs (HMRC) has commissioned stakeholder research each year since 2012, with the exclusion of 2019-2020. The research provides insights into the views of main stakeholder groups and informs improvements to the way HMRC engages with these audiences in order to better fulfil its strategic objectives.

1.2 Research objectives

Yonder was commissioned by HMRC to undertake research among its stakeholders to:

understand stakeholders’ general perceptions of HMRC:

• favourability, trust, and competence

• gauge awareness of HMRC and stakeholders’ knowledge about HMRC’s remit, vision and priorities

• explore HMRC’s perceived performance generally as the UK’s tax authority and in specific areas

• assess HMRC’s communication and engagement with stakeholders.

1.3 Method

Yonder conducted two phases of research on behalf of HMRC, consisting of an initial quantitative phase, followed by a qualitative phase.

For the quantitative research, Yonder interviewed 200 HMRC stakeholders using an online survey. The survey took approximately 15 minutes to complete.

For the qualitative research, Yonder conducted 29 qualitative in-depth interviews. Interviews were conducted by telephone or by video conferencing (e.g. MS Teams), and lasted approximately 30 minutes. The interviews were conducted with the use of a discussion guide that was developed by Yonder in collaboration with HMRC.

Fieldwork

Quantitative fieldwork ran from 11 January 2023 and 14 March 2023.

Qualitative interviews took place between 10 February 2023 and 20 April 2023.

Sample

The sample of Parliamentarians and devolved administrations was drawn from a complete list of current Members of Parliament (MPs), Members of the Scottish Parliament (MSPs), Members of the Senedd (MSs), and Members of the Legislative Assembly in Northern Ireland (MLAs). The sample of Business, Customs, Voluntary and Community Sector (VCS), Agents, Media and Other stakeholders was drawn from a list of important stakeholders identified by HMRC.

The sample breakdown was as follows:

Stakeholder group	Quantitative sample size	Qualitative sample size
Parliamentarians and devolved administrations	52 (32 MPs, 8 MSPs, 6 MSs, 3 MLAs and 3 Lords)	5 (4 MPs, 1 MSP)
Agents	70	7
Business	32	8
Customs	18	6
Voluntary and Community Sector (VCS)	14	3
Media	5	0
Other	9	0
Total sample size	200	29

2. Findings

2.1 Overall perceptions

HMRC stakeholders were highly familiar with the department. A large majority felt they knew at least a fair amount about the department’s work, though stakeholders’ knowledge was usually focused on the area of the department they interacted with in their professional role as opposed to the entirety of HMRC. Stakeholders’ knowledge and opinions of HMRC were based primarily on their own experiences and contact with staff, as well as the opinions of their colleagues and peers.

Stakeholders were largely positive regarding HMRC. Most had a favourable opinion of the department, agreed it was an organisation they could trust and agreed it was competent.

Amongst these stakeholders, HMRC was both better understood and more likely to be viewed favourably than comparator organisations such as the Department for Work and Pensions (DWP), Home Office and Ministry of Justice.

Most stakeholders described themselves as ‘critical friends’ of HMRC, with very few describing themselves as outright critics or advocates. A majority of these ‘critical friends’ had a favourable overall opinion of HMRC, and stakeholders often interpreted the term as wanting to work collaboratively and positively with the department to help it improve.

A statistical technique called key driver analysis was used to understand which factors were most important for driving favourable opinions of HMRC. The technique identified stakeholders’ satisfaction with their working relationship as most important. HMRC’s perceived performance as the UK’s tax authority and the extent to which the department could be relied upon to look after customers’ interests were the next most important drivers of favourable opinions.

2.2 HMRC’s performance

The majority of stakeholders believed that overall HMRC carried out its duties professionally and that it was competent. Most stakeholders also perceived HMRC to be performing well as the UK’s tax authority – a key driver of favourable opinions.

The stakeholders that believed HMRC was performing well as the UK’s tax authority attributed this to a variety of factors. Many stated that HMRC’s communication with stakeholders was the reason they perceived the department to be performing well, while others favourably compared HMRC’s performance with the performance of tax authorities in other countries. Amongst the minority that thought HMRC was performing badly as the UK’s tax authority, the most common stated explanation was poor customer service.

However, HMRC’s customer service was a concern for many stakeholders and most rated HMRC’s performance for ‘improving customer service’ to be poor. Common criticisms focused on slow response times, difficulty contacting HMRC by telephone and difficulty accessing the right people at the department.

HMRC’s delivery and improvement of digital services received a mixed reception. Stakeholder groups supported the introduction and expansion of digital tax services, but there were concerns regarding HMRC’s delivery. Some frustration was linked with perceived technical problems and poor guidance.

2.3 Engagement and communication

Most stakeholders were satisfied with their working relationship with HMRC, which was the most important driver of favourable opinions of the department. This group of stakeholders cited the responsiveness of staff, the willingness of staff to engage with stakeholders, and perceptions of staff as friendly, hard-working, and respectful as the main reasons they were satisfied with their working relationship with HMRC. Those with close relationships with staff at HMRC often valued two-way dialogue that helped build mutual respect and understanding.

Most stakeholders were also positive about the extent to which HMRC listened to, understood, and responded to their views. However, stakeholders felt it was particularly important for HMRC to respond to views and some stakeholders said that the department could do more.

Two main areas of frustration regarding HMRC’s stakeholder engagement were identified. A minority of stakeholders felt that they were not listened to, or that staff at HMRC did not always seem to welcome their feedback. Some noted occasions when they believed they had been consulted late, once decisions seemed to have already been made. These occasions fuelled some frustration that stakeholders were not always being listened to or that their views were not always valued.

Other stakeholders expressed frustration at a perceived lack of transparency around decision-making processes. Stakeholders understood that there were situations when their feedback could not be implemented, but they expressed a desire for HMRC to increase transparency and to provide explanations or follow-up communications.

Regardless of these specific areas of concern, HMRC’s stakeholder communications were generally well-regarded. Most stakeholders used various HMRC communications channels and found these channels – particularly meetings, forums, roundtables, and workshops – to have been useful.

Stakeholders suggested that HMRC could focus on further improving stakeholder engagement by ensuring that stakeholders feel involved in consultative processes at an early stage, by increasing transparency and facilitating two-way dialogue, and by working to improve the consistency of some of its engagement channels.