Monday, 8 December 2014

Self Assessment

There's a lot of cynicism about politics and government. 
So how refreshing to hear a senior official being brutally honest recently. 
Eleanor Emberson, head of Revenue Scotland, admitted her estimates for the cost of the new tax collection service had proved inaccurate and she needed lots more staff than planned.
Hence the bill jumping twice in recent months.
Not a great sign for a service where money and maths are supposed to be central.
But certainly refreshing - if not reassuring.
Here's the story

Tom Gordon

THE bill for Scotland’s fledgling tax collection system has risen yet again - with managers forced to recruit a third more staff than planned.

Originally priced at £16.7m, the cost of Revenue Scotland is now more than £21m.

The running cost of the quango, which will initially collect two devolved taxes from April, was included in the SNP’s independence White Paper in November last year.

However within a month it had to be revised upwards by £3.5m, or 21%, to £20.2m in order to take account of extra activity and investment.

According to evidence presented to Holyrood’s finance committee recently, that figure was later adjusted to remove the cost of a new tax tribunal system, taking it down to £19.5m.

But in her six-monthly update to MSPs, Eleanor Emberson, the head of Revenue Scotland, said the cost had risen again by 9%, to £21.2m.

The bill covers the running costs from April next year to March 2020, and is on top of one-off start-up costs of £4.5m.

Kenneth Gibson, the SNP convener of the Finance Committee, described the latest price hike as “quite significant”, while grilling Emberson.

She said the extra was “almost exclusively staff costs”, as Revenue Scotland had raised its staffing from 30 to 41 in order to ensure the new system runs smoothly.
Eleanor Emberson: told Finance Committee her estimates had proved wrong

“My estimates have not turned out to be completely accurate,” Emberson admitted. 

“I am being honest about that. We have had to put in additional resource to deliver. 

“However, the bulk of the difference between £16.7m and £21.2m is to do with ensuring that the design of the systems matches the aspiration for Scotland.”

Emberson also stressed the running cost was less than the £22.3m Her Majesty’s Revenue & Customs (HMRC) would have charged to collect the new devolved taxes, the Land and Buildings Transaction Tax and the Scottish Landfill Tax.

Tory MSP Gavin Brown, who sits on the Finance Committee, said: “I’m concerned we have had cost increases several times and would like a guarantee from the government that it’s not going to increase further as we get closer to the launch date. The bill is now roughly similar to what HMRC would have charged. 

“Given one of the reasons for creating Revenue Scotland was that it would be cheaper than 
HMRC, it raises questions about the Scottish Government’s initial decision.”

A Government spokesman said: “Costs for setting up and running Revenue Scotland demonstrate good value for money and remain below the original estimate provided by HMRC.” 

“These costs include additional plans to enhance Revenue Scotland’s tax collection capacity, 
over and above that currently provided by HMRC. These include an IT system to support additional work on tax compliance, and new measures to address illegal landfill dumping.”

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