Corporate report

Your Charter annual report: April 2019 to March 2020

Published 5 November 2020

Message from the Chief Executive and Permanent Secretary, Jim Harra

Our vision is to build a trusted, modern tax administration system that fits with the way our customers run their businesses and their lives. An important element of this is how we treat our customers and what we do if we fall short of our standards.

The Charter Annual Report is an important document to help HMRC achieve this vision. It is a report published by HMRC’s Commissioners but provided to us by HMRC’s Customer Experience Committee, which is made up of Non-Executive Directors of HMRC and independent advisers. It provides us with a valuable assessment on how we are doing to improve the experience of our customers and where we need to improve. I am grateful to the committee, the Adjudicator and the group of HMRC’s stakeholders from the tax community for their work in assembling the report. We look forward to continuing to benefit from their feedback, challenge and advice in the future.

This report is based on the current Charter and our performance against it in the year 2019 to 2020.

We are updating the HMRC Charter following a period of public consultation. It will set out the refreshed standards of behaviour to which HMRC will aspire when interacting with our customers. But words need to be backed up by action.

I’m confident the measures and oversight being put in place to monitor our future performance against the updated Charter will continue to enhance our understanding and visibility of areas where we need to do more.

Jim Harra, HMRC First Permanent Secretary and Chief Executive

Foreword by Chair of the Customer Experience Committee, Mervyn Walker

Customer experience for HMRC can cover a wide range of activity, from a customer understanding how the tax system affects them, engaging in a digital transaction, looking for guidance on GOV.UK, phoning a contact centre, all the way through to some customers being the subject of a compliance enquiry.

It is clear from HMRC’s annual survey results, set out in this report, that many customers continue to have a positive experience of HMRC. And as Jim Harra sets out in his foreword in the 2019 to 2020 HMRC Annual Report, HMRC has responded impressively to the COVID-19 crisis from March 2020, delivering financial support schemes within a few short weeks. There is an opportunity to build on these successes.

Yet there is clearly more to do. With the establishment of the Customer Experience Committee in 2018 to replace the Charter Committee, we have been bringing a wider range of views to challenge and support HMRC in making improvements.

For the first time this year, we have included in this report direct feedback from outside contributors – firstly from the Adjudicator, who I am delighted now also sits as a member on the committee, and secondly from a representative group of external stakeholders from the tax community.

Their feedback echoes many aspects of the survey where HMRC does well – providing a good service across many areas of the business with dedicated employees demonstrating integrity in the work they do. Yet it also tells us of the improvements in customer experience that are still required, in particular, continuing to develop a customer-focused culture and making interactions with HMRC as easy and straightforward as possible.

Progress will involve HMRC’s continued modernisation and linking up of our digital systems, redesign of processes, improved customer communications, better services for those who need extra support, and embedding the Charter’s standards across HMRC’s employees and all of its business areas.

The committee sees 2019 to 2020 as having been an important year in the development of HMRC’s strategic focus on customer experience. The committee welcomes HMRC’s emphasis on building a trusted, modern tax administration system and the importance of customer experience in achieving this. In the next phase of the committee’s work, we will increasingly be focusing on turning this strategy into operational delivery.

The consultation and publication of the new revised Charter this autumn will provide HMRC with an important vehicle for ensuring that good intentions are followed by improvements that its customers can actually feel. HMRC should also look to build on its much praised rapid and customer-focused response to the COVID-19 crisis this year.

The Customer Experience Committee has had a productive first full year, hearing from all parts of HMRC and offering its advice and suggestions. We look forward to continuing to advise and hold HMRC to account for progress.

Mervyn Walker, October 2020

1. Introduction

Why the HMRC Charter matters

Legislation states that HMRC’s Charter should set out the ’standards of behaviour and values to which [HMRC] will aspire when dealing with people in the exercise of their functions’. This means what customers can expect from HMRC and what HMRC expects from customers. It is also a legal requirement for the Charter to be reviewed regularly and that all revisions should be published.

The findings in this report for the financial year 2019 to 2020 are measured against the commitments under Your Charter, the previous version of HMRC’s Charter which was active from 2015 until the launch of the new HMRC Charter in November 2020.

Summary of the Customer Experience Committee’s work in 2019 to 2020

The Customer Experience Committee supported, challenged and guided the department on its customer experience work in its first full year. It ran four quarterly meetings in 2019 to 2020, as well as ad hoc meetings and numerous informal support sessions on specific topics. The committee advised in particular on the following areas:

• review of the Charter and launch of the public consultation to ensure the department incorporated a range of views
• HMRC’s performance framework and measures to strengthen focus on customer experience outcomes, especially related to ease of service and increasing trust in the tax system
• ‘deep dives’ into the customer experience work within key areas of the business such as compliance and policy
• work to develop support for customers who need extra support
• improving complaints management and learning from complaints
• work to improve the quality of HMRC’s guidance and customer communications

Assessing HMRC’s performance against the Charter in 2019 to 2020

The Customer Experience Committee sees the Charter as a key document in holding HMRC to account for the service it provides and also for driving customer-focused change. In 2019 to 2020 members oversaw a review of the Charter and launched a public consultation in February 2020.

As part of this review, the committee received feedback both internally and externally saying that the Charter should have more visibility. So members have looked to connect the Charter more explicitly to HMRC’s wider organisational vision to build a trusted, modern tax administration system and embed its principles in the structures and processes across HMRC.

In conducting the review, the committee has also taken account of references to the Charter in key external reports. The Loan Charge Review in December 2019 recommended that HMRC should ‘review its Charter to set higher expectations of performance during interactions with members of the public, and to ensure that staff are trained to meet these expectations’.

In 2018, the House of Lords Economic Affairs Committee report on HMRC’s powers and safeguards made 2 recommendations focused on improved consultation with representatives of the tax community in the Charter Annual Report and that the Charter clarifies responsibilities towards unrepresented taxpayers.

For the first time this year, the Customer Experience Committee commissioned direct contributions to the Charter Annual Report from 2 external sources – HMRC’s Adjudicator and the Charter Stakeholder Group, made up of external representatives of the tax community. The committee plans to continue drawing on these perspectives on an ongoing basis and has thanked them for their contributions. The Adjudicator is a member of the committee and HMRC will continue to meet regularly with the external stakeholder group to obtain feedback.

2. Executive summary - Overall assessment by the Customer Experience Committee

The results of HMRC’s 2019 annual customer survey for individuals, small business and agents show how HMRC offered a good experience to many customers in many areas in 2019 to 2020. See specific measures against Charter commitments in Appendix 2.

The survey showed that two-thirds (63%) of individuals, three-quarters (75%) of small businesses and just over half of agents (51%), who had an interaction with HMRC in the previous 12 months, had a positive rating of their overall experience.

On external benchmarks, the Institute of Customer Service publishes its bi-annual UK Customer Service Index in January and July each year. The sample size is much smaller than the HMRC annual survey and therefore statistically significant trends are more difficult to identify. Nonetheless the July 2020 results suggest HMRC’s satisfaction score has been increasing over the last few years and that it is at its highest level for 10 years. However, HMRC remains 9th out of the 10 public sector organisations featured in the index.

HMRC also asks customers on an ongoing basis about the experience of their individual interactions. In 2019 to 2020, 81.6% of customers were satisfied with their online experience, up from 80.2% in 2018 to 2019. Throughout 2019 to 2020, HMRC also published some experimental customer service measures in its quarterly performance reports – see Appendix 1. These show how customers rated the ease of using its digital services (Net Easy) increasingly positively throughout the year, with the Net Easy score rising from 57.7 in April 2019 to 71.8 in March 2020. The survey asked customers on HMRC’s digital services ‘how easy was it to deal with us today?’. The Net Easy score represents the total of positive responses minus the total of negative responses. The score that can be achieved therefore ranges from 100 to -100.

On telephony, the committee notes that HMRC was not able to meet its average speed of answering target in 2019 to 2020, due to a challenging first half of the year and will need to think about how performance can be maintained across the year in the future, while continuing to factor in the ongoing impact of COVID-19. However, it notes positive performance across other experimental measures set out in in Appendix 1 below and the HMRC Annual Report.

On the ‘once and done’ measure, where customers have their query resolved after one contact and do not need to get back in touch, scores were consistently above 85% for digital and almost 80% for telephone throughout the year.

The committee has seen a commitment by HMRC in 2019 to 2020 to put customer experience at the centre of its strategic approach, for example:

• more focused customer measures, such as Net Easy and improved infrastructure for capturing customer feedback like new telephony and compliance customer surveys
• the launch of the public consultation of the new HMRC Charter to set higher expectations and embed its principles more within the organisation
• a refreshed approach for better supporting customers who need extra support
• policy and compliance teams reviewing how they can put the customer perspective at the heart of their work, for example the development of compliance professional standards to embed the Charter commitments within compliance work
• making better use of complaints insight through more visibility and a more action-orientated approach

Overall, there are some strong performance metrics and there are positive steps in the right direction to make further progress. However evidence in this report suggests there is more to do to make performance more consistent. Poor customer experience can still result from HMRC systems not joining up, complexities in policy or tax administration or from HMRC’s communication. Over the last few years, the annual customer survey results have largely maintained performance but neither have they shown a consistent improvement, with some indicators showing a statistically significant fall.

The Charter Stakeholder Group points to several specific services that could have been improved from a customer experience point of view. HMRC’s 2019 annual customer survey for individuals, small business and agents confirms that customers can feel things take too long: only 57% of individuals, 68% of small businesses and 34% of agents were positive about the time taken to reach an end result in their dealings with HMRC. This is also echoed in the comments by the Adjudicator.

Linked to this, the Adjudicator and the Charter Stakeholder Group point to ways HMRC can continue to develop and improve its complaints handling process, such as better communication and a clearer understanding of the levels of customer dissatisfaction which are not recorded as complaints.

While the Institute of Customer Service UK Customer Service Index suggests good progress, when benchmarked against other sectors on a UK satisfaction score index, HMRC is lower than most other public services as well as private sector industries.

The Charter Stakeholder Group and the Adjudicator point to a perception among HMRC customers that it is not yet HMRC’s starting position to treat them as honest. The customer survey shows only around a third of individuals, small businesses and agents feel that HMRC applies penalties and sanctions equally.

The committee also notes in particular the feedback from the Adjudicator and the Charter Stakeholder Group on the importance of embedding the Charter’s standards across the business and appropriate investment in underlying systems.

Feedback from both the Charter Stakeholder Group and the Customer Survey, where agents continue to be the lowest-scoring customer group, suggests that the Charter commitment to ’accept that someone else can represent you’ is where there remains a big perceived gap between the Charter commitment and HMRC performance.

Finally, it is important to recognise HMRC’s achievement in delivering internationally renowned employment support schemes in record time and with huge efficiency during the COVID-19 pandemic. This outstanding work to design and deliver these completely new schemes with great speed has demonstrated what is possible. The capability and commitment of HMRC employees, who responded magnificently to the new challenges they faced, augurs well for the future. It provides firm foundations for building a more flexible, resilient, responsive and effective tax administration system that can handle a vast and widening range of customer circumstances.

3. Overall independent assessments

Adjudicator

The Adjudicator reported that there is little sign that the current Your Charter is widely referred to or embedded in HMRC. In the Adjudicator’s experience of complaints, Your Charter is sometimes raised directly by customers, with comments that HMRC employees have not acted in accordance with the expectations of the Charter. It is not referred to by HMRC in any of the correspondence that the Adjudicator’s Office reviews.

The Adjudicator said:

We support the ambition to review the Charter and embed it across all HMRC activity. From the perspective of effective complaint handling it is important that it is seen to apply to all parts of the department, and not only directly customer-facing functions.

In many complaints that the Adjudicator reviews, there is evidence of HMRC employees engaging with customers in the positive terms set out in the Charter.

While the office has not specifically focused on the Charter in its feedback to date, and rarely gives feedback that directly relates to the Charter commitments, the Adjudicator does report regularly on issues that are indicative of patterns of behaviour that relate to those commitments.

For example, it provides regular feedback on individual cases relating to 6 categories including: customer focus, culture and behaviours and communication, much of which align to Charter expectations.

These and other issues are addressed in more detail in the The Adjudicator’s Office annual report 2020.

Over the past 2 years, the Adjudicator’s Office has seen and given feedback on evidence of behaviours that do not match with HMRC’s expectations. The most notable examples cover 3 commitments – Respect you and treat you as honest, Provide a helpful, efficient and effective service and Deal with complaints quickly and fairly.

Charter Stakeholder Group assessment

For membership of the Charter Stakeholder Group, see Appendix 3.

The Charter Stakeholder Group considered HMRC’s performance against Your Charter in 2019 to 2020. The group acknowledges that its feedback reflects the fact that members mostly hear about what goes wrong and recognises that a lot goes right – which they may be less aware of.

Although taking effect mainly in 2020 to 2021, the group said:

[It] would like to put on record [its] praise for HMRC’s rapid and customer-focused delivery of the Coronavirus Job Retention Scheme and the Self-Employment Income Support Scheme in the response to COVID-19, which began in March 2020.

In 2019 to 2020, the representatives stated that the following cross-cutting issues underpin HMRC’s overall performance against the Charter:

• HMRC lacks a digital system which will improve customer experience. Many issues arise due to legacy systems and until appropriate investment is possible, this will be hard to overcome
• this situation can lead to a perception that HMRC requires businesses to improve their systems, but is not willing to do the same itself

4. How HMRC performed against the individual Charter commitments

The comments from the Adjudicator and Charter Stakeholder Group against each of the Charter commitments are set out below, followed by HMRC activity and an assessment from the committee. HMRC also provides further detail on its performance against its key customer service targets in its 2019 to 2020 Annual Report and Accounts.

Respect you and treat you as honest

Adjudicator commens

Customers frequently express the perception that they are not treated as honest. This perception is sometimes borne out in the way that complaints are handled, which results in failure to resolve matters in internal complaint procedures.

The Adjudicator has given detailed examples on individual complaints. The office has also presented themed reports on claims of underlying conditions in HMRC which the Adjudicator said ‘dictate against a culture of respect for individual customers both in complaint handling and wider departmental activity’.

Charter Stakeholder Group comment

This commitment is not yet the starting point for compliance operations. This may be because many compliance campaigns are driven from an amount of evidence, but the challenge is to balance the need to reduce the tax gap and ensure that people feel they are being treated as honest and with respect.

Training is needed to help HMRC officers cope with the tension between this commitment and the one to ‘tackle those who bend or break the rules’ below.

There have been issues with, for example, some VAT policy initiatives, where the taxpayer is assumed to be doing something wrong. To resolve these, the stakeholder group believes it would be preferable for the policy team to engage directly with the taxpayer or their agent when explanations are provided.

HMRC activity

HMRC:

• began development of a new set of compliance professional standards for all compliance teams, setting out clear expectations of how to manage casework, including focusing on the customer and applying the Charter in the way we work
• completed work to map out the experiences of customers at each stage of an HMRC compliance intervention. From this work, the department identified several improvements to ensure future products and process design is informed by customer insight
• improved the language and tone of some standard compliance letters, based on external feedback from professional and representative bodies including Tax Aid and the Chartered Institute of Taxation

Committee assessment

The annual customer surveys show that in the vast majority of cases, customers find HMRC approachable and professional. However, there is clearly a perception that the starting position is sometimes not to treat customers as honest, particularly in compliance cases. The committee will continue monitoring this as HMRC rolls out its new compliance professional standards, which should help to address this issue.

Provide a helpful, efficient and effective service

Adjudicator comment

The Adjudicator’s Office has seen repeated evidence of delays. Gaps in policy or lack of flexibility to consider variations in customer circumstances cause delays in putting things right for customers.

She quotes the example where customers move prematurely from tax credits to Universal Credit as a consequence of an HMRC mistake, incurring ongoing financial loss. Despite agreement to put in place ways to put this right, delays in taking action mean that some customers have been waiting for more than a year without redress, in terms of a remedy or a repayment.

Another example quoted are delays in recovering historic debts. While relying on legitimate authority to collect money owed, the Adjudicator says she has seen many instances of HMRC failing to consider the impact on customers who receive demands for payment, which can sometimes occur after several years with no communication about the debt. This could have a particularly severe impact on low-income customers.

Charter Stakeholder Group comment

For the majority of the time, HMRC is able to provide a good service.

Challenges can arise in certain specific areas and also if a service requirement falls outside of the standard service. There are examples in 2019 to 2020 where the group has identified some challenges:

• PAYE dashboard – which users have found unclear and confusing
• the service provided by the Research and Development Tax Relief scheme
• Real Time Information data can be time-consuming and costly for the customer to resolve when it goes wrong, although it is recognised HMRC has taken steps to correct issues since its introduction - the group would like to see better joined-up thinking across HMRC, in particular, between policy development and delivery teams
• in debt management, the payments and liabilities screen is often not up to date on the HMRC system, which means HMRC and the employer have different information about what is paid and due
• HMRC aspires to a ‘once and done’ approach but in practice the group believes that this does not occur as much as it should
• agents can feel they spend too much time resolving HMRC-generated errors
• Customer Compliance Managers work well, but there is a perception that delays are increasing - it would be beneficial to have Customer Compliance Managers for mid-sized business and larger agent firms and access (as required) to comparable levels of expertise and knowledge received by larger businesses
• in 2019 to 2020, while HMRC met its target for customer satisfaction with its digital services, and the handling of tax credits and Child Benefit claims, the department missed targets for iForms, call handling and post handling targets

HMRC activity

During 2019 to 2020, HMRC’s customer satisfaction with digital services improved. In the first half of this financial year, non-digital channels did not deliver the customer service the department would have liked, due to resourcing challenges carried forward from financial year 2018 to 2019, plus higher than expected customer demand. In the second half of the year performance improved steadily and was close to where HMRC wanted it to be, but not all of the customer service targets were met on telephony and post.

More details about customer service performance can be found in the 2019 to 2020 HMRC Annual Report and Accounts.

In addition, HMRC reported the following achievements:

• improved online authentication, introducing new instructions to help existing Self Assessment customers to self-serve and recover credentials for their Self Assessment accounts
• enhanced the Business Tax Account service to enable users to access their tax services in a single place – for example, if customers have both business and personal tax accounts they can now see a link to their personal account within their Business Tax Account
• delivered an improved Self Assessment process for customers. Acting on customer insight, HMRC provided improved support for customers in a channel they preferred, for example through the online Customer Forum (which doubled traffic compared to 2018 to 2019), YouTube videos and 5 new targeted webinars
• identified and corrected 35,000 customer Self Assessment records ensuring customers’ accounts were accurate, reducing customer confusion and the need for HMRC contact to reassure them
• issued prompts and reminders to customers to encourage compliance with the Self-Assessment deadline dates, avoiding unnecessary penalty processes and charges - this enabled around 13 million customers to comply by deadlines
• utilised feedback and customer insight, to enhance the availability and functions on the Personal Tax Account - more than 25 million customers have signed up for digital services for individuals, with the majority signing up to a Personal Tax Account

Committee assessment

Both the survey results and feedback from external sources show that HMRC meets this commitment in the majority of cases. However, there is still clearly room for improvement in areas such as timeliness HMRC’s 2019 annual customer survey for individuals, small business and agents showed only 57% of individuals were positive about the time taken to reach the end result in their dealings with HMRC) and in managing services outside of the standard service.

Be professional and act with integrity

Charter Stakeholder Group comment

The stakeholder representatives recognised that the vast majority of HMRC employees act with integrity. However, the group has seen some inconsistency in information provided on helplines and a variation in the levels of expertise. These issues can lead to delays and increased costs for taxpayers, especially those who do not have a Customer Compliance Manager.

HMRC activity

HMRC:

• began a programme to bring together the work done in ‘front office’ contact centres and ‘back office’ administrative centres across all areas of business - this is driving improvements in waiting times in many of HMRC’s processes, as many activities are now being undertaken in real time with the customer on the phone rather than being referred elsewhere
• refined its approach to supporting customers who need extra help, including:
  • extending HMRC’s Extra Support services across the department including into its compliance activities to help provide tailored support for customers who need it – whether because of financial hardship, mental health, domestic and financial abuse – and any other reasons
  • making sure that a new dedicated extra support team for compliance provides advice to caseworkers on how they can best support customers during enquiries and, where appropriate, providing direct support to customers
  • working more closely with the debt advice sector to improve the support HMRC provides to customers in financial hardship
• continued to promote mediation in disputes through Alternative Dispute Resolution as a means of avoiding costly litigation - nearly 75% of cases were either fully or partially resolved, and a further 15% clarified. In surveys, 99% of agents told HMRC that they would recommend Alternative Dispute Resolution and 95% were satisfied with the process. The department also introduced a new online application form that is much easier to complete and significantly reduced the number of ‘rejections’

Committee assessment

It is reassuring to see feedback from the Charter Stakeholder Group that, in its view, the vast majority of HMRC employees act with integrity. However, it is clear from the annual survey results that there is room for improvements in systems designed to help prevent mistakes and from the Charter Stakeholder Group in ensuring the right level of expertise is available to resolve issues. The committee will continue to look at the customer survey results and feedback from stakeholders in this area, as well as how HMRC rolls out the Charter, the compliance professional standards and principles of support for customers who need extra help.

Protect your information and respect your privacy

Charter Stakeholder Group comment

The group expressed confidence that HMRC has the strictest protections in place for taxpayer information and does not have any particular area of concern on this commitment. Members noted that sometimes this can lead to lengthy security protocols with agents or taxpayers, and suggest that consideration might be given on whether these can be eased in any way without compromising security.

HMRC activity

As it sets out in its 2019 to 2020 HMRC Annual Report, HMRC thoroughly respects and safeguards the confidentiality of data whenever the department shares it. The way HMRC handles and shares data is governed by the Commissioners for Revenue and Customs Act 2005, the Data Protection Act 2018 and the General Data Protection Regulation (GDPR).

HMRC has made initial progress in meeting its GDPR obligations. Since the introduction of GDPR, it has set up a Data Protection Office, introduced training to raise awareness across HMRC, and undertaken extensive discovery of the compliance risks across some 850 legacy processes and digital systems. Despite making progress in identifying its GDPR risks, insufficient progress has been made to remediate those risks, leaving HMRC and the tax and benefits system exposed. Page 54 of the 2019 to 2020 HMRC Annual Report sets out the planned work to manage these risks.

Committee assessment

Feedback suggests there is a high level of confidence in HMRC’s safeguards, which will be important to maintain. However, the committee notes HMRC’s planned work to mitigate GDPR risks.

Accept that someone else can represent you

Charter Stakeholder Group comment

There is a significant gap between this Charter commitment and actual performance.

Agents want HMRC to deliver on its commitment that agents should be able to see and do what their clients can see and do. Despite a lot of work in previous years, a customer’s right to be represented is increasingly being ignored in the interests of cost and simplicity.

There are examples of the agent element not being designed in at the beginning of a product – for example the Trust Registration Service and 30-day reporting of gains on residential property.

It is difficult for customers to authorise agents, where HMRC’s increasing requirements for digital authorisation are fragmented, which is inconsistent with this Charter commitment.

HMRC activity

HMRC has developed services which enable tax agents to deal with the department digitally on behalf of their clients. The Agent Services online account now allows agents to act for their clients for Making Tax Digital VAT, Capital Gains Tax and to register trusts. HMRC is also updating agent guidance on GOV.UK following feedback via the Agent Forum.

To further strengthen its engagement with agents and intermediaries, HMRC reviewed its various stakeholder forums this year, relaunching the Representative Bodies Steering Group (formerly Joint Initiative Steering Group) and launching a new advisory body on digital services. HMRC works with professional bodies to provide updates on areas of our work that impact agents and take on board their feedback and concerns.

Good tax advisers make it easier to get tax right, for clients and for HMRC. HMRC works in partnership with agents and their professional bodies to improve standards and provide support for its customers. HMRC published a Call for Evidence on raising standards in the tax advice market to give taxpayers more assurance that the advice they are receiving is reliable. Where agents fall short of the standards expected, HMRC takes appropriate action to help agents improve their standards and protect customers from sub-standard advice. Where an agent is a member of a professional body and HMRC believes their activities constitute misconduct, HMRC will make a Public Interest Disclosure report to their professional body.

Committee assessment

The committee notes from the observation of the Charter Stakeholder Group, that this is the commitment where there is a large gap between the commitment and actual performance. The committee notes HMRC’s changes to its stakeholder forums to strengthen its engagement with agents and intermediaries and encourages it to use them to further build confidence in this area.

Deal with complaints quickly and fairly

Adjudicator comment

In July 2019, the Adjudicator’s Office produced its second report on the department’s internal complaint handling. This detailed further evidence of issues reported earlier – these included the potential under-recording of customer dissatisfaction as a complaint, a lack of access to the complaint process or appropriate escalation to a higher process, and unclear communication and process.

In 2019 to 2020, the Adjudicator upheld 44% of complaints from customers that were escalated to the Adjudicator’s Office. This is an increase from 35% the previous year. The office introduced an improved independent investigation process earlier in the year, which has had an impact on the rates of complaints being upheld.

Charter Stakeholder Group comment

The group suggested that there should be greater awareness of complaints handling processes and guidance among complaints officers.

HMRC activity

In 2019 to 2020, HMRC handled new complaints in an average of 17 days for Tier 1 level. The department continues to focus on improving responsiveness to dealing with complaints.

In comparison to last year, new complaint receipts have:

• decreased by 8% at Tier 1
• decreased by 15% at Tier 2
• decreased by 6% for cases requiring a decision at Adjudicator level

7% of new complaints escalated from Tier 1 to Tier 2; and 16% escalated from Tier 2 to the Adjudicator.

Upheld rates are unchanged in relation to Tier 1 (53%) and up in relation to Tier 2 (49% compared to 41%) and Adjudicator (44% compared to 35%) on last year’s figures. 14 complaints were investigated by the Parliamentary and Health Service Ombudsman in 2018 to 2019, the latest year for which figures are available. Of the 14, none were fully upheld and 2 were partially upheld resulting in 2 recommendations for HMRC and the Adjudicator’s Office, both of which HMRC complied with.

HMRC remains committed to learning from complaints, and the insight received from the Adjudicator, to support the department in driving improvements in the service offered and the way it interacts with customers. This year HMRC launched a Complaints Insight Board, bringing senior leaders together to consider what the department can learn from complaints.

In addition, for the first time HMRC published a formal response to the Adjudicator’s Annual report for 2018 to 2019. This response focused on improving the approach to learning from complaints, developing a new operating model for complaints handling and building on collaborative working with the Adjudicator.

Committee assessment

This committee welcomes HMRC’s response to the Adjudicator’s 2019 annual report, which builds on many of the themes discussed by the committee this year: greater promotion and recognition of the importance of learning from complaints and developing a new operating model for complaints handling to ensure complaints are resolved at the earliest opportunity.

Tackle those who bend or break the rules

Charter Stakeholder Group comment

In general, HMRC has performed well against this commitment. However, illegal behaviour remains a stubbornly high proportion of the tax gap.

HMRC should consider the tone of communications used for compliance letters being issued to multiple recipients.

While tackling those who break the rules is a particularly important aspect of the Charter for HMRC – the most important aspect for the taxpayer is that they are shown respect.

HMRC activity

The best way to tackle non-compliance is to prevent it before it can occur. For the majority, our strategy is to help customers get tax right through educational material and customer service — but we don’t hesitate to use our civil and criminal powers where we believe a business or individual is trying to cheat the tax system, or if the system is under attack by organised criminals. Pages 26 to 31 of the 2019 to 2020 HMRC Annual report sets out HMRC activity to tackle avoidance and evasion.

Committee assessment

The committee agrees with the Charter Stakeholder Group that HMRC has performed well against this commitment but notes its observation of the importance of retaining respect and maintaining a presumption of honesty.

5. Customer Experience Committee recommendations

1. The committee sees 2019 to 2020 as a year where progress has been made to lay the strategic groundwork for delivering further customer experience improvements. It will be important now to ensure that the positive intentions by HMRC flow across the organisation and result in tangible improvements to be felt by customers.
2. Action is still needed across the whole department. Based on our insight, the committee sees the priority areas for action are to:
   • embed the new Charter’s standards across HMRC’s employees and all of its business areas, where customer experience is seen as a priority and monitored across all of its work, supported by the development of revised strategic priorities
   • continue modernising and joining up digital systems and processes to make sure customers find it easier to interact with HMRC
   • improve the quality of guidance and communications from HMRC, to support customers in understanding their obligations and helping them to comply
   • continue building good work so far increasing the emphasis on customer experience in policy and compliance work, using the new Charter and compliance professional standards, improved training and revised measures and rewards incentivising a high standard of customer experience
   • extend and embed support services for those customers who need extra support
   • continue to deliver against its agents strategy to meet its commitment in the new Charter ’to recognise that someone can represent you’
   • build on the skills of HMRC employees to deliver improved customer experience
3. The committee welcomes the new HMRC Charter and its measurement framework and encourages the department to develop its transparency and accountability around the experience of customers. This should include greater reporting internally and externally of key customer experience performance measures and increased visibility, monitoring and learning from complaints insight.
4. The addition of customer surveys to the telephony channels in 2019 to 2020 will provide an important extra customer perspective going forward. The committee would like to see a more focused approach on the results of these surveys to drive improved customer experience across all channels, sharing good practice in one service which could be applied to others.

Appendix 1 - Key Customer Service Performance indicators 2019 to 2020

Overall performance indicators

	2019 to 2020	2018 to 2019	Target
Customer satisfaction with digital services	81.6%	80.4%	80%
Customer iForms cleared within 7 days of receipt	87.2%	94.1%	95%
Average speed of answering a customer’s call	6 minutes 39 seconds	5 minutes 14 seconds	05:00 minutes
Customers waiting more than 10 minutes to speak to an adviser	29.9%	19.7%	No more than 15%
Customer post cleared within 15 days of receipt	70.2%	76.6%	80%
Customer post cleared within 40 days of receipt	87.6%	96.4%	95%
Handle tax credits and Child Benefit claims and change of circumstance (UK)	13.2 days	12 days	An average of 22 days
Handle tax credits and Child Benefit claims and change of circumstance (international)	65.7 days	61.5 days	An average of 92 days

Additional customer experience metrics

The customer experience metrics below were introduced in April 2019 and are experimental, until the department understands how they fit with our customer service operations.

The Net Easy score represents the total of positive responses minus the total of negative responses. The score that can be achieved therefore ranges from 100 to -100.

Ease of using digital services (Net Easy scores)

Overall Net Easy score for 2019 to 2020: 65.2

Apr 2019	May 2019	Jun 2019	Jul 2019	Aug 2019	Sep 2019	Oct 2019	Nov 2019	Dec 2019	Jan 2020	Feb 2020	Mar 2020
57.7	61.1	64.5	65.4	64.7	64.1	65.2	66.7	66.4	64.8	70.4	71.8

Digital contact resolution

The customer survey conducted on digital channels asks ‘Were you able to do what you needed to today?’. The result is the percentage of people who said ‘yes’.

Overall satisfaction for 2019 to 2020: 87.8%

Apr 2019	May 2019	Jun 2019	Jul 2019	Aug 2019	Sep 2019	Oct 2019	Nov 2019	Dec 2019	Jan 2020	Feb 2020	Mar 2020
83.2%	85.0%	87.7%	88.6%	87.4%	87.3%	87.9%	88.9%	88.7%	89.5%	88.6%	87.8%

Telephony contact resolution

The percentage of callers to HMRC helplines who don’t call back again within 7 days after speaking to an adviser.

Overall percentage for 2019 to 2020: 79.0%

Apr 2019	May 2019	Jun 2019	Jul 2019	Aug 2019	Sep 2019	Oct 2019	Nov 2019	Dec 2019	Jan 2020	Feb 2020	Mar 2020
80.0%	80.6%	79.5%	79.9%	78.6%	78.8%	78.3%	77.4%	78.2%	76.7%	79.0%	80.9%

Appendix 2 - Measuring HMRC’s performance against Charter commitments: 2019 customer survey questions and results – individuals, small businesses and agents

Individuals

Notes:

• an asterisk * indicates a statistically significant percentage point (ppt) change since 2018
• the figure for ’HMRC made it easy for someone to act on your behalf’ is for individuals using a professional adviser - the figure for anyone receiving help, whether professional or from another source, was 71% in 2019

Charter commitment	Survey statement	Percentage of individuals who agree	Percentage point change between 2018 and 2019
Respect you and treat you as honest:
	HMRC were approachable	58%	-6*
	HMRC treated me fairly	71%	-3
Provide a helpful, efficient and effective service:
	Easy to deal with tax issues	55%	-6*
	It was easy to find information	51%	-1
	HMRC got transactions right	63%	-2
	Quality of information was good	60%	-
	Time taken was acceptable	57%	-2
Be professional and act with integrity:
	HMRC systems prevented mistakes	48%	-1
	HMRC are efficient and do not waste money	33%	-1
	HMRC ensures all customers pay/receive the correct amounts	41%	+1
Protect your information and respect your privacy:
	HMRC ensures data and personal information is treated confidentially	66%	-
Accept that someone else can represent you:
	HMRC made it easy for someone to act on your behalf	80% [see note above]	+4
Deal with complaints quickly and fairly:
	HMRC resolved any queries or issues	60%	-1
Tackle those who bend or break the rules:
	HMRC apply penalties and sanctions equally	34%	+1

Agents

Note: An asterisk * indicates a statistically significant percentage point (ppt) change since 2018.

Charter commitment	Survey statement	Percentage of agents who agree	Percentage point change between 2018 and 2019
Respect you and treat you as honest:
	HMRC were professional	70%	-1
	HMRC treated my clients fairly	66%	0
Provide a helpful, efficient and effective service:
	Easy to deal with tax issues on behalf of clients	50%	-2
	It was easy to find information	45%	-1
	HMRC got transactions right	57%	+2
	Quality of information was good	58%	-
	Time taken was acceptable	34%	-3
Be professional and act with integrity:
	HMRC systems prevented mistakes	43%	-
	HMRC are efficient and do not waste money	22%	+2
	HMRC ensures all customers pay/receive the correct amounts	48%	+5*
Protect your information and respect your privacy:
	HMRC ensures data and personal information is treated confidentially	79%	+2
Deal with complaints quickly and fairly:
	HMRC resolved any queries or issues	46%	-2
Tackle those who bend or break the rules:
	HMRC apply penalties and sanctions equally	40%	+4*

Small businesses

Note: An asterisk * indicates a statistically significant percentage point (ppt) change since 2018.

Charter commitment	Survey statement	Percentage of small businesses who agree	Percentage point change between 2018 and 2019
Respect you and treat you as honest:
	HMRC were professional	85%	-
	HMRC treated my business fairly	81%	+1
Provide a helpful, efficient and effective service:
	Ease of dealing with business’ tax issues	72%	-3
	It was easy to find information	62%	-1
	HMRC got transactions right	77%	+1
	Quality of information was good	71%	+1
	Time taken was acceptable	68%	-1
Be professional and act with integrity:
	HMRC systems prevented mistakes	61%	-
	HMRC are efficient and do not waste money	35%	-1
	HMRC ensures all customers pay/receive the correct amounts	51%	+1
Protect your information and respect your privacy:
	HMRC ensures data and personal information is treated confidentially	74%	-
Accept that someone else can represent you:
	HMRC made it easy for someone to act on your business’ behalf	76%	-3
Deal with complaints quickly and fairly:
	HMRC resolved any queries or issues	69%	+1
Tackle those who bend or break the rules:
	HMRC apply penalties and sanctions equally	35%	-2

Appendix 3 - members of the Charter Stakeholder group

• Rebecca Benneyworth – Administrative Burdens Advisory Board
• Susan Cattell – Institute of Chartered Accountants of Scotland
• Glen Collins – Association of Chartered Certified Accountants
• Samantha Mann – Chartered Institute of Payroll Professionals
• Caroline Miskin – Institute of Chartered Accountants in England and Wales
• Will Silsby – The Association of Taxation Technicians
• Claire Thackaberry – Low Incomes Tax Reform Group
• Richard Wild – The Chartered Institute of Taxation

Appendix 4 - responsibilities and roles of Customer Experience Committee members

Purpose

The Customer Experience Committee supports and challenges HMRC’s Executive Committee (ExCom) on customer experience-related issues and to helps HMRC deliver on its strategic objectives.

Below is a list of the Non-Executive Directors of HMRC and independent advisers making up the Customer Experience Committee in 2019 to 2020, along with positions they held and their experience.

Name	Current positions and experience
Mervyn Walker (Chair)	With his background as a lawyer, Mervyn has broad experience in a range of roles in large customer service and industrial companies. He has been Group Human Resources Director at 3 FTSE-listed companies – British Airways, Mondi and Anglo American. He has extensive experience of organisational transformation in large and complex organisations. He was appointed as a Non-Executive Director with HMRC in September 2014 and became Lead Non-Executive in January 2017 and Chair of the Customer Experience Committee in April 2019.
Alice Maynard CBE	Alice is a Non-Executive Director with HMRC and has dedicated her career to improving organisations that are the building blocks of society – transport, housing and social care organisations. She holds positions in a number of public sector and not-for-profit organisations. Alice combines her understanding of how business works and of social issues to help the organisations she works with thrive, while working towards a fairer society.
Juliette Scott	Juliette is a Non-Executive Director for HMRC. She is also a non-executive board member at Versus Arthritis (formerly known as Arthritis Research UK) and provides advisory services through her consultancy business. Juliette was previously at eBay – firstly on the board of eBay UK as the Director of Customer Insight, and in her last role she was responsible for customer insight and analytics across Europe. Juliette was introduced into the world of data insight through her time at customer data science company dunnhumby, where she worked in senior roles across many areas at Tesco.
John Whiting CBE (until 31 July 2019)	John was a Non-Executive Director of HMRC and was previously the Tax Director of the Office of Tax Simplification (OTS), a part-time role he held since the OTS was established. Until 2013, he was the Tax Policy Director of the Chartered Institute of Taxation and before that, he was a tax partner at PricewaterhouseCoopers. He is also a Board member of Revenue Scotland.
Jean-François Bessiron	Jean-François is an independent adviser on the Customer Experience Committee. He is a global leader with more than 20 years’ experience in supply chain/commercial operations and digital marketing and technology. He has held senior leadership positions with FTSE100 and NASDAQ quoted companies at Kingfisher, TechData, Amazon and most recently at Groupon, where he is International Vice President.
Leonie Foster	Leonie is an independent adviser on the Customer Experience Committee. She was on the operating board of Dunelm, the UK homewares retailer until March 2020, where she held accountability for the end-to-end customer experience across digital, store format and marketing, for online sales and for leading the multi-channel transformation. Before joining Dunelm, Leonie spent 5 years at Tesco where she led the insight, customer strategy, advertising and Clubcard teams and 5 years at OC&C strategy consultants.
Joseph Gordon	Joe is an independent adviser on the Customer Experience Committee. He is currently the Head of Retail Banking at a customer experience focused FinTech business in the process becoming a bank. Prior to this Joe was the CEO of first direct Bank a role he held for the past 3 years, where he led an overhaul of the business’ finances, strategy and digital transformation programme. During this time first direct won every major industry and pan-industry award on customer experience and satisfaction. Joe has been a long-standing advocate of customer service, experience and technology and has led significant teams across multiple countries and territories. He has a breadth of business experience through roles in strategy, operations, marketing and finance in a number of FTSE 100 organisations such as Sainsburys, BT and latterly HSBC, where he was the Customer Experience Director for HSBC UK. Joe believes that change is driven through people and culture, and customer experience should be a design principle rather than an overlay for modern businesses to be successful.
Steven Martin	Steven is an independent adviser on the Customer Experience Committee. He is currently Managing Director of International Data at LiveRamp following his recent move from the post of Managing Director of Consulting and Analytics in the same organisation. His new role focuses on helping clients to make the most of both their own customer data and other data they can access about their customers from partners and suppliers.
Andrew Stephenson (until November 2019)	Andrew was an independent adviser on the Customer Experience Committee until November 2019. He was Group People Director at Lookers, the UKs listed automotive dealer group, from May 2016 until November 2019. Reporting to the CEO, Andrew was responsible for the HR function and people agenda for more than 8,500 employees across the UK and Ireland. Andrew also led the IT function and was responsible for customer experience across the company’s 31 franchised manufacturer brands. Previously, Andrew spent 7 years at DFS furniture as group HR and property director, a function that included customer services and customer experience.
Paul Morton	Paul Morton was appointed as an HM Revenue and Customs Non-Executive Director in September 2019. He was Tax Director of the Office of Tax Simplification from March 2017 to January 2019. Before that he was Tax Director for RELX Group plc (formerly Reed Elsevier), the global information and analytics group, for 12 years. He was actively engaged with the Organisation for Economic Co-operation and Development (OECD) and tax policy makers in the UK, United States and the Netherlands and at EU level on tax policy matters relating to the digital economy and many other aspects of tax policy. Previously, he was a tax manager and adviser at Royal Dutch Shell in a number of UK and overseas roles over 16 years. He moved to Shell from KPMG, where he focused on international tax and insurance companies. He began his career in tax – after reading microbiology at University College London – when he joined the Inland Revenue as a tax inspector.
Patricia Gallan	Patricia is a Non-Executive Director at HMRC. She was awarded the Queen’s Police Medal (QPM), for gallantry and distinguished service, and is a former police officer whose last role was Assistant Commissioner Specialist Crime and Operations of the Metropolitan Police in London until 2018. She previously served as Deputy Assistant Commissioner (Specialist Operations – Security and Protection) and also Deputy Assistant Commissioner (Professionalism) from 2012 to 2015, Assistant Chief Constable (Operations Support) of Merseyside Police from February 2006 to 2012, and also served as temporary Deputy Chief Constable of the force from October 2009 to February 2010. She was Assistant Chief Constable at the National Crime Squad from January 2005 to February 2006.