Tax credit claimants who didn't appeal Concentrix decisions will have cases reviewed by HMRC

The report, published last December, found that HMRC and Concentrix were complicit in a decision-making process that resulted in thousands of claimants having their tax credits unfairly stopped, resulting in a situation that "left vulnerable people in humiliating hardship".

MoneySavingExpert.com reported the initial findings and recommendations made in this report. Now, the Government and HMRC has accepted some of these recommendations.

What findings has the Government agreed to act upon?

The original 90-page Work and Pensions Committee report was extensive. Here's a summary of the major recommendations:

• HMRC has agreed to undertake a review (by March 2017) of cases where Concentrix amended or terminated a benefit award but an appeal was not requested by the claimant. Of the 59,000 claimants whose benefits were stopped or cut by Concentrix, 36,000 requested an appeal called a 'Mandatory Reconsideration'; 87% of those were upheld in the claimant's favour.

• The Government has agreed to better publicise the availability of hardship payments. It aims to update its information on hardship payments this month.

• HMRC has committed to detailing the reasons it suspects fraud and error in letters to claimants. One of the committee's main concerns was that Concentrix did not inform tax credit claimants of the nature of suspicions against them, with claimants left not knowing what they had to prove or disprove, or how. HMRC hasn't given a timeframe it expects this to happen by.

• HMRC has agreed to extend any future deadline for the submission of supporting information by claimants if telephone handling performance again falls below acceptable levels. It's also begun work on allowing claimants to supply information electronically. The committee found that claimants were "unfairly disadvantaged by the failure of the telephone system". One single mother told the committee she had spent 19 hours and 57 minutes on the phone trying to resolve her tax credit problems.

• HMRC is taking independent advice on the next annual tax credit renewal process in March 2017. It will also report to the committee before going ahead with this.

Can I claim compensation if my tax credits were wrongly stopped?

If you had your tax credits wrongly stopped by Concentrix, you may be able to claim compensation on top of backdated payments – some have been sent up to £100.

We've got details of how to do so, as well as what else you can do if you're in severe financial difficulty, in our Concentrix compensation story.

What does the Work and Pensions Committee say?

Frank Field MP, Work and Pensions Committee chair, says: "The committee is very pleased that HMRC has accepted our recommendations, which is testament to the work of Parliament on this issue. HMRC was right to fire its contractor, but many of the processes used by Concentrix were the same as those used by HMRC itself.

"In particular, the committee welcomes the review of cases where claimants had their tax credits stopped but did not submit a formal appeal. For many claimants, particularly those who were unwell, lacked self-confidence or had caring responsibilities, the document-heavy process of challenging a wrong decision by Concentrix was surely prohibitively daunting.

"The real answer is of course to root out fraud and error at entry to the system rather than stopping benefits in payment as first resort."

What does HMRC say?

An HMRC spokesperson told us: "HMRC is absolutely committed to paying tax credit claimants all the money to which they are entitled, efficiently and on time. HMRC terminated the contract with Concentrix when it became clear that it was not delivering the quality of service we expect for our customers.   

"It is important to make checks on tax credits payments to ensure the right people are receiving them under the law, and this work will now be done by HMRC. We will not be entering into external contracts for this in future. We apologise to all those who did not receive the standard of service that they should have. The vast majority of people who asked to have Concentrix’s decision reviewed have now had their payments reinstated where that decision was wrong."