Unless the new boss at HMRC acknowledges the real mess it’s in he’s wasting his time

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I am worried about the new chief executive of HMRC. Jon Thompson, who like his predecessor, has no knowledge of tax having spent the last seven years at the Ministry of Defence, appeared before the Treasury Committee of the House of Commons last week. Civil Service World reported:

The new chief executive and permanent secretary of HM Revenue & Customs has admitted that staff morale “remains rather worryingly low” at the organisation and that further work is required to improve the situation.

Speaking before MPs on the Treasury Select Committee on 8 June, Jon Thompson said he was still trying to “get to the bottom” of the issues behind the organisation’s low scores in the annual Civil Service People Survey.

However, in his first appearance before the committee since taking the helm of HMRC from Dame Lin Homer earlier this year, Thompson conceded that IT problems and a new performance management regime were core problems that required attention.

This is hardly a good start. Stating the bleedin' obvious may do for a few weeks after being appointed but he has already been around longer than that. So let me list some of the real problems he faces.

First, our government continually suggests paying tax is a bad thing to do. Tax is undermined from the very heart of government. There's no surprise morale is low.

Second, just about every person in HMRC is going to have to move to keep their jobs in the next five years, and all because almost all the HMRC estate was sold to an offshore company by Dave Hartnett. If you want to destroy morale an enforced move is one of the best ways to do it.

Third, jobs are going. I know that because of a mess up there has been a short term increase, but that is simply because too may were sacked in the first place. This is another way to destroy morale. Not training the new recruits adequately (ten weeks is all they are given) is another way to send out the message that the skills in HMRC are not appreciated.

Fourth, make sure that the  number of jobs left are too few to do the job properly. I am told the probability of having a VAT inspection in East Anglia has now fallen to once every three hundred years.

Fifth, pass unworkable legislation and claim it is progress. The General Anti-Abuse Rule is an example.

Sixth, have the government vote regularly to block the real changes you know are needed that will change tax payer behaviour and make them more compliant. Voting against public country-by-country reporting in the EU is an example.

Seventh, underestimate the scale of the tax gap by publishing data that is just wrong, leaving people to face a problem management will not acknowledge.

I could go on, bit I think you get my drift.

It's true that poor IT and a terrible review system are real issues, but they're symptoms of a much deeper malaise of under-resourcing, mismanagement and political undermining. Unless Jon Thompson goes for the real issues he's wasting time. But he would not be the first to do that.