CASH Consultation Forum
Minutes of meeting 30 June 2008

Attendees:

Jayne Dyson (JD) - HMRC
Catherine Hanson (CH) - HMRC
Tim Downes (TD) - HMRC
Kathryn Roberts (KR) - HMRC
Julian Hatt (JHa) - HMRC
Ian Wilkins (IW) - HMRC
Phil Nilson (PN) - HMRC
Mark Holden (MH) - HMRC
Carol Lunney (CL) - HMRC
Ken Gower (KG) - AFSS
Norman Green (NG) - BCS
Roger Hancock (RH) - LSSA
Kevin Hart (KH) - BASDA
Simon Parsons (SP) - IREEN
John McKinney (JMc) - IREEN
Simon Sabel (SS) - e-Conveyancing Liaison Group
Judith Daley (JDa) - ASPIRE

Apologies:

Dave English (DE) - HMRC
John Harrison (JH) - HMRC
Vicky Ranson (VR) - HMRC
Ron Powell (RP) - HMRC
Steve Mole (SM) - HMRC
David Thickett (DT) - HM Cabinet Office
Jairo Rojas (JR) - BASDA

1. Introductions

JD welcomed all attendees to the meeting.

The updated issues list was distributed to attendees and it was agreed that feedback on the list would be sent to CH.

2. Minutes of the last meeting

These are agreed.

3. Update on action points from the last meeting

An updated list of actions points were given to attendees and it was agreed to discuss only outstanding actions points and send any comments on cleared items to CH.

AP10 - Representative Bodies to escalate any issues relating to Aspire through JD. No issues have been reported to date so this action point is now closed.

4. Customer Contact Online Strategy Update- Mark Holden

MH gave an overview of progress on the Online Filing Strategy.

Key points:

  • The strategy work is developing through a steering group of key stakeholders and industry representatives.
  • The scope of the steering group is to:
    • Investigate the provision of sustainable free at point of use third party software for entry level customer segments
    • Review of the pilot employer CD-ROM with online filing capability.
  • HMRC does not envisage incentivising the growth of third party free products by paying software developers.
  • Enhanced promotion of third party free products is being considered and changes to the positioning and layout of the recognised third party software listing on the HMRC website are being worked up.
  • The group is looking at how to encourage other software developers into the market for providing free products.
  • Additional criteria will be considered such as quality products by quality software developers and the level of support provided to the customer (online help and support and 121 support).
  • HMRC and Software Developers will need to consider how to limit/set boundaries around functionality to limit the scope/functionality of the free software.
  • A shared vision is being worked on consideration being made as to what conditions would need to be in place for HMRC to withdraw its online products.
  • No firm timescales in place.

Comments from the Group:

  • SDLT Software Developers are already seeing an impact on their business and market from their customers moving from using third party software to the HMRC product. SDLT software developers are keen to trial as an early adopter. MH to take forward with JH.
    AP1– MH
  • We must ensure that any assumptions are fully and robustly tested so that we do not prevent anyone from complying with their tax obligations.
  • There are nuances within each head of duty and some are more mature in their online filing offerings, so we should consider each area separately but ensuring a level of consistency of the principles across each area is maintained.
  • IW questioned whether there was any scope for extending the Strategy across Government. MH advised that work was ongoing with Transformational Government but the scope for this phase was to build a sustainable model for HMRC. KH suggested that extending across Government should be considered for phase 2 to enable the sharing of common data.
  • HMRC should consider making use of best practice from Customs/International. Any comments can be fed into the strategy through CASH. Online steering group to review Customs/International practices.
    AP2 - MH
  • HMRC needs to ensure there is clear messaging to software users to reflect who can use the free software and ensure that functionality to limit use is built into the requirements.
  • HMRC needs to be smarter in its use of language, for example on the web pages and in literature to help customers choose the most appropriate route for them to send information to and receive information from HMRC. HMRC should also avoid referencing Internet software as this excludes EDI- instead we should use the term ‘online software’. SP suggested HMRC remove the term ’commercial’ software as this indicates that there is a charge. Software Developers and HMRC can work collaboratively to make these changes and a proposal for a steering group to take this work was put forward. MH to take forward.
    AP3 – MH

MH gave an overview of progress on the review of the employer CD-ROM.

Key points:

  • GfK NOP an independent body has been tasked with reviewing the employer CD-ROM. The review is looking at the level of usage, support required in using the product and its impact on the software industry.
  • Indicative feedback suggests that there has been little migration so far from the use of third party software.
  • Level of usage of the online filing link is currently in the region of 32,000.
  • The questionnaires completed by users indicate:
    • 80 per cent shift from using the HMRC online product
    • 12 per cent shift from paper filing
    • 1 per cent shift from third party software
      7 per cent is new employers


Comments from the Group:

  • Only a small percentage of the non-filers targeted (400,000) have used the CD-ROM.
  • Although only a shift of 1 per cent from third party software is indicated we can not say what percentage of the new employers may have chosen to use third party software in the absence of the CD-ROM.
  • MH to clarify the average P14 filing submission.
    AP4-MH

5. Update on Sharing Risk Rules- Jayne Dyson

JD gave an update on progress following the Sharing Risk Rules workshop.

Key points:

  • The workshop is in response to recommendation 18 of the Carter review of HMRC’s online services.
  • A massive culture change for HMRC.
  • The driver is to reduce the bureaucracy and the errors made in completing returns.
  • Contributors to the workshop from CASH are thanked for their contributions to the workshop making it a constructive and positive event.
    HMRC will actively seek to share compliance risk to help reduce error rates and to encourage compliance and administrative burdens where there is no threat to misuse or potential fraudulent activity.
  • Risk rules to be reviewed on a service by service basis, with Self Assessment used as proof on concept and areas of commonality being understood to aid efficiency. Services will be rolled out in an agreed prioritised manner. No timelines for delivery cycle yet. Customs and International Rep IW questioned whether this applied to all HOD and requested offline discussion with JD. JD to contact IW to discuss.
    AP5-JD
  • It is envisaged that intelligent software will screen out any errors/issues prior to processing so reducing the burden on HMRC and the end user.
  • HMRC will be better able to focus resource on high risk compliance activities. Next step is to submit the initial proposal to the Excom sub group in July for authority to proceed.

Comments from the group:

  • To what extent would the HMRC compliance role be delegated to agents?
  • A cost/benefit analysis is crucial from all perspectives.
  • There is a potential link for the Online Strategy where risk rules functionality could be seen as the value added element when moving from basic (free) software to chargeable software.
  • Consider an automated link (RSS feed) for risk rule updates.

6. Update on the Carter Project- Mark Holden

MH gave an update on the Carter Project

Key points:

  • The focus is currently on the changes to Self Assessment, addressing the capacity requirements for the January 2009 peak.
  • There has been substantial investment in the IT infrastructure with enhanced disaster tolerance, dynamic balancing and re-routing load across data centres. Throttling will take place with early indicators for systems under stress.
  • Contingency planning is underway and substantial testing and volumetric testing to determine the break point of systems.
  • There will be new real time eMIS functionality to track submissions through different routes.
  • MIS is helping the SDST to identify pinch points and common errors in software products and they are proactively engaging with software developers to discuss how to implement changes to improve success rates. Capital Gains Tax, Foreign pages and full automation of SA Online amendments will be made available in October.
  • TPVS for VAT to be provided six months ahead of mandation.

Marketing:

  • A new TV and marketing campaign will commence pre-October to highlight the change of filing date for Self Assessment. The campaign will actively promote the online filing message and availability of commercial software.
  • A step by step guide to the Registration and enrolment process for online filing will be provided and an online demonstrator is already available.
  • Work is underway to identify the Self Assessment taxpayers that have not filed online and these taxpayers will be pre-registered and sent an activation token in November.
  • A direct mailing will be sent to all agents with 2-500 clients.

Corporation Tax

  • Approximately an eighth of CT filers are submitting online. 80 per cent of these are submitting using third party software with an 18 per cent failure rate. Once the failure rate drops to 10 per cent for either product, HMRC will work collaboratively with software developers to draw up a marketing plan.

Comments from the Group:

  • KH congratulated HMRC on the successful payroll year end.
  • KH congratulated the software developer community for successfully incorporating the PAYE schematron.
  • When Ministerial Budgetary challenges are enforced, HMRC needs to get better with development and technical delivery and should represent the disconnect in timescales where possible.
  • Overall strategic architectural overview to be given at future CASH meeting. CH to add to agenda.
    AP6-CH

7. Accreditation

TD gave an overview on extending the scope of third party software accreditation.

Key points:

  • Accredited software provides the end user with a choice of products which comply with pre-determined standards.
  • There is a mixed model for administering accreditation in place due to the former Inland Revenue/HM Customs set up, with PAYE accreditation administered by HMRC and VAT audit services administered by an external body.
  • It is recognised that one size does not fit all, so each service will be considered separately to ensure that it is fit for purpose for each service at every level.

Comments from the Group:

  • HMRC needs to consider what it is trying to achieve from introducing accreditation.
  • We need to understand what end users want from accreditation and should clearly define what we mean by ‘recognised’ and ‘accredited’ products to help them select the appropriate software for their needs.
  • SDLT is keen to introduce accreditation to weed out poor quality software developers and products which may discredit the market.
  • HMRC should consider changing the structure and layout of the list of accredited software. Representatives suggested a feature list on the website of HMRC accredited products with the possibility of including product rejection rates.
  • We should ensure that the accreditation process is not too onerous that it discourages new and smaller software developers from entering the market.
  • We should look at best practice gained from our experiences with PAYE and VAT accreditation.
  • We should consider a code of practice for accreditation and an adjudicator or ombudsman for users to report poor quality software suppliers and products.
  • KG stated International Trade would be very interested in accreditation. IW asked whether it would apply to developers outside of UK.

It was agreed that a separate focus group should be implemented to take the accreditation work forward. TD will send invitations out.
AP7-TD

TD will circulate the accreditation issues log to CASH Representatives so they can log comments, ideas or issues from their represented areas.
AP8-TD

8. Legislation Deadlines

The International Trade experiences difficulties where EU/Ministerial deadlines are enforced and cannot be changed when the technical specifications are delivered late. This results in the squeezing of the development and testing of the delivery and there is no temporary option of reverting to paper due to the high volumes of declarations. The issue is being raised at Director General Level within Customs. The trade bodies are also putting their representations into the EU but without effect.

KH suggested lobbying the European Software Association. SS suggested contacting the lobby body QUINTAS. SS will pass details of the organisation on to KG.
AP9-SS

9. Engagement & Strategy

The Engagement strategy provided at the last CASH meeting is now baselined. An implementation plan has been developed and this was reviewed and discussed. (Both documents are attached).

Key points:

  • HMRC commit to early engagement with Software Developers where their software development cycle and/or their customers will be impacted through the introduction of a new e-Channel, a proposed change to an existing service or product, or planned/unplanned outages.
  • HMRC commit to introduce regular formalised engagement across all services at all levels from strategic to operational.
  • HMRC commit to deliver and support improved testing facilities for Third Party Software Developers.

KH asked for diagram at the end of Engagement Strategy to be fleshed out to indicate relevant interface points and underpinning processes.
AP10-JD

It was agreed that it would be useful to model or discuss examples of how the new process works. CH to add to agenda for the next meeting.
AP11-CH

MH to share the roadmap for Carter.
AP12-MH

10. Account Management Strategy

TD gave an overview of the Account management Strategy.

Key points:

  • Putting the customer at the heart of what we do.
  • Designated subject matter expert account manager for each service.
  • Service level agreements for telephone and email support.
  • Software Developers can request an extension to the standard service support- levels agreed through discussion with relevant account manager.
  • Identifies the key stakeholders.

Comments from the group:

  • JD asked all Representative Bodies to encourage their membership to complete the survey. Their feedback is vital to the improvement of the service and support provided by HMRC and the SDST.
  • KH suggested using a web based survey such as Survey Monkey to improve the response rate to surveys.

11. Any Other Business

11.1 PAS76
A BASDA specific meeting on the value proposition with Nicky Harrison did not take place due to absence and Nicky has now moved on from this role. KH has channelled his feedback through BASDA.

11.2 e-Rooms Update
The business case is progressing but there are still some accessibility issues to overcome. Once available it will be piloted and its effectiveness reviewed.

11.3 Issues list
On each occasion that the CASH Issues list is distributed a two week window will be applied for reviewing and providing feedback. It will also be added as a regular agenda item. CH to add to agenda.
AP13-CH

11.4 Audit Files
SP asked who centrally controls/regulates audit software within HMRC. SP will feed back to TD.
AP14-SP

11.5 Future Meeting Topics

  • Future Visioning Proposition- SP suggested that CASH should start a future visioning piece to look at how HMRC can move out of the paper world entirely for example, enabling a taxpayer to notify us of a change of name and address electronically. Commitment will be required at senior level with attendance from Business Partners Technical Architects. JD to explore whether this is already being considered elsewhere within HMRC and who key stakeholders would be. Separate meeting required to undertake ‘blue-sky thinking’.
    AP15-JD
  • Regulatory Burden Session

11.6 SA Pre-population for Third Party Software- MH
The technical solution proposed for calling down data has found to be very expensive at over four times what was budgeted. HMRC have challenged to find a different solution but are not in a good position for achieving the October 2008 test window. The SDST will let Representatives Bodies have early sight of the proposed solution.

12. Next meeting

Date to be confirmed.