On Wednesday June the 25th HMRC announced, without prior consultation with PCS, that it plans to engage a ‘Managed Service Provider’ (MSP) as early as during quarter 4 of 2025. This is management talk for bringing in outsourcing work, particularly across Customer Service Group (CSG).
It is apparently clear then, that HMRC have not learned the lessons from it’s last experience with a MSP.
Concentrix
Between May 2014 and November 2016 the private agency firm Concentrix was used to handle Tax Credits calls. The contract was terminated early in November of 2016 following the disasterous experience. Private companies are target and profit making focused and driven organisations, that have no business being paid out of the public purse. For HMRC, Concentrix were a quick fix compared to allocating recources and investing in the hiring and training of permanent staff. The whole experience had severe consequences for claimants. In fact several MPs at the time debated this issue in Parliament and condemned HMRC and Concnetrix for “gross failure of customer service”.
A Work and Pensions Committee (WPC) report concluded that there was a “Cut first, think later” attitude that “Plunged claimants into humiliating hardship and debt”. The report went on to refer to a “Guilty until proven innocent” approach and commented that 90% of initial appeals against decisions were actually upheld. Despite the report finding that there had been a “high human cost of errors” it also pointed out that HMRC had been demanding and pressuring Concentrix into finding even more cuts! The consequences to claimants were severe, with some expressing feeling no option but to take their own lives as a result of hardship.
The Concentrix staff taking these highly distressing calls weren’t trained in how to handle these life or death situations. They are also of course not empowered to change the conditions of the pro-business pro-capitalist approach taken by HMRC and other civil service departments under austerity governments, to slash public spending and put claimants in such desperate positions in the first place.
Consequently, Concentrix staff themselves suffered mental harm through no fault of their own, and were also victims of this doomed contract alongside the claimants.
This insufficient provision is no accident, it is baked into all outsourcing. Improper training and worse terms and conditions for outsourced staff are a recipe for providing a service on the cheap. HMRC have indicated that MSP staff will be used to address basic queries from service users but as the disastrous Concentrix experience shows, HMRC downplay the complexity of the work our telephony staff do in order to get as low a quote as possible. This knowing disregard for providing quality support for ordinary working people who rely on HMRC is unacceptable.
The Cost to Our Members
In addition to the consequences of bringing in MSPs for claimants and the degrading of services provided by HMRC, the words of the Public Accounts Committee (PAC) not ours! The use of MSPs will have a negative and potentially job threatening impact on Civil Servants employed with permanent contracts.
HMRC have not yet confirmed which MSP they intend to use, or what the pay and working conditions of those agency staff might look like, but there can be no doubt that MSP workers will be treated as a quick and cheap fix. Instead of employing staff on a permanent basis and investing time and money into the training and retention of those staff, HMRC will take advantage of a minimum wage work force with worse or no employment protections, and will likely provide the bare minimum training necessary. Ask any worker in any industry what their experiences of outsourcing is, or ask agency workers themselves, and you will hear reports along the above mentioned lines.
There is a real danger then, that a two tier workforce will be created, and the; pay, terms and conditions of staff employed by the MSP could be used in negotiations by HMRC to attempt to undercut the; pay, terms and conditions of permanently employed, union organised civil servants.
Members in the Surge and Rapid Response team (SRRT, an in-sourced department used to address surges in demand, work backlogs or crisis situations across government) are first in the firing line with most of SRRT’s staff currently engaged in CSG deployments and with the drying up of any other work for SRRT in recent years. The question must be asked, what happens to SRRT members of staff when compared to a cheaper, less union organised and more exploitable option?
Another Labour U-Turn
This announcement by HMRC is disappointing for many reasons, but not least in light of the present Government’s pledge in their election manifesto. Along with disgusting attacks on; pensioners, the disabled and the watering down of it’s promises to the trade unions, Labour is once again affirming it’s position as a representative of bankrupt British Capitalism. This government is sending a message just one year into it’s term, that rather than focus on consolidation and the development of our public services it would rather outsource and sell the running of our public services to private companies who prize profits above social needs. To quote the pledge referred to in the Labour Party’s election manifesto;
‘Labour will learn the lessons from the collapse of Carillion and bring about the biggest wave of in-sourcing of public services in a generation. A Labour Government will end the Tories’ ideological drive to privatise our public services, extend the Freedom of Information Act to apply to private companies that hold contracts to provide public services, exclusively with regard to information relevant to those contracts, to ensure any outsourced contracts are transparent and accountable for delivery. We will also extend the Freedom of Information Act to publicly funded employers’ associations, where not already covered.’
Fight Back!
This threat to members’ jobs, pay, terms and conditions cannot be allowed to go unanswered. So what can be done? Here is what the BLN says:
– In discussion going forward the GEC must continue to be clear and firm with HMRC. The GEC must express it’s contempt for this move, including the fact that HMRC did not consult or negotiate with the GEC prior to it’s announcement.
– Every PCS branch in HMRC Group should organise members meetings. The meetings should be used to fully brief members about this development and gather the views, and the fighting ideas of our members.
– PCS should raise with members the prospect of industrial action or action short of a strike, in this case ‘Work to rule’.
– This issue should be included in a wider campaign in HMRC, to fight on; pay, office attendance and employee relations. A single, unifying campaign would allow the Group to develop a fighting strategy to win for members on a range of the issues that matter to them.
– The GEC should make representations to the PCS Parliamentary Committee (PPC), calling on MPs to once again raise opposition to HMRC’s use of an MSP, in parliament. Members should write to their local MPs raising PCS concerns.
– Do you agree with us, join the BLN! Get involved! And join the fight for a campaigning, fighting and democratic PCS that is capable of winning on in-sourcing, pay, terms and conditions.
PCS Broad Left Network 