back to article Legacy IT kit is behind 80% of UK taxman's pandemic costs, says spending watchdog

An ageing IT estate is responsible for the bulk of the UK tax collector's costs in adjusting to the COVID-19 pandemic, according to a report from Parliamentary spending watchdog the Public Accounts Committee. In a review of the tax authority's performance for 2019-2020, the Public Accounts Committee (PAC) found HMRC spent too …

  1. Anonymous Coward
    Anonymous Coward

    Well if the UK didn't have archaic tax codes written by KPMG, PWC, and, Co.

    I dare say it could be run on a Rpi 4 and a Synology NAS

    1. Anonymous Coward
      Anonymous Coward

      Re: Well if the UK didn't have archaic tax codes written by KPMG, PWC, and, Co.

      I hate acronyms with a passion. An article about the UK tax system covering 60 million people, and we're supposed to just know you mean Raspberry PI 4.

      1. Kane

        Re: Well if the UK didn't have archaic tax codes written by KPMG, PWC, and, Co.

        "I hate acronyms with a passion. An article about the UK tax system covering 60 million people, and we're supposed to just know you mean Raspberry PI 4." do know where you are, right?

    2. simonlb Silver badge

      Re: Well if the UK didn't have archaic tax codes written by KPMG, PWC, and, Co.

      Agreed, our tax system seems overly convoluted and is probably well overdue a thorough overhaul from top to bottom. Mind you it'd be even better if HMRC just collected the money owed from everyone instead of cutting deals with big companies to let them off a few £Billlion, like they did with Vodafone a while back.

  2. Chris G

    I don't see the problem

    Now that Britain is no longer subsidising Europe, I am sure some of that freed up cashcan be allocated to funding the development of new IT for HMRC.

    Oh no, wait!

    It's all been spent on PPE.

    1. Dan 55 Silver badge

      Re: I don't see the problem

      It's all been thought through. The British government's Brexit negotiating positions were ideologically designed to wreck JIT logistics between the UK and the EU so transactions will drop to such a level that the 30-year-old paper-driven CHIEF can cope with it.

      Anything the current rabble in charge say blaming business or the EU is just a charade, they know full-well what they did and what's anyone going to do about it, write a strong letter to their MP or hope for Labour to ride to the rescue? Relax, grab your stockpiled popcorn and watch from the safety of your bunker.

      1. Dan 55 Silver badge

        Re: I don't see the problem

        And right on time one wine importer has posted his odyssey with CHIEF. Remember not to edit fields, it could get confused.

  3. nematoad

    You pays your money...

    Even without knowing which government department this was it would be plain that said department was run by accountants.

    In this case they seem to have confused capital expenditure with operating expenditure and from vague memories of the numerous accountancy courses I was forced to attend that would seem to be a real schoolboy type of howler.

    There is an old saying that "An accountant knows the price of everything and the value of nothing." or alternatively "Penny wise and pound foolish."

    Idiots the lot of them, and to think that they are in charge of forcefully parting us from our money to give to another bunch of fools, the Government.

    1. Headley_Grange Silver badge

      Re: You pays your money...

      My experience of accountants is very different from yours. All the accountants I've known have had a very clear understanding of the difference between Capex and Opex - the main difference being that Opex is easy to authorize and Capex is impossible to authorize.

    2. Anonymous Coward
      Anonymous Coward

      Re: You pays your money...

      "Penny wise and pound foolish."

      I think that saying needs to be updated to take into account modern accountancy. "Penny foolish and pound fucking insane" springs to mind.

      Come to think of it, "An accountant knows the price of everything and the value of nothing." should be

      "An accountant knows the grossly inflated price of everything and the value of nothing."

    3. taxman

      Re: You pays your money...

      "Even without knowing which government department this was it would be plain that said department was run by accountants."

      Most are, but their budgets are set by the accountants the departments work for. In the end it is Treasury that determines what funding a department will get and it often works out that it is not enough. For the past decade HMRC has had to give up a huge amount to meet the Austerity Challenges the government set. This delayed even further any plans for modernising and only just about let development go ahead to meet new requirements from government.

      Not that long ago there were numerous dependent legacy systems still running on NT4.0 let alone Windows 2000 or Server 2003. Can't guess how many still are. These all need bringing up to date to be able to run on later OS. But it's not a simple matter of switching over as many of the services running on the old kit are interlinked and need to run 24 hours a day.

      Perhaps it would have been better if the government had paid for system integration when HM Customs initially joined with the Inland Revenue than let it drag on for a couple of decades, retaining separate systems then slowly merging when the string holding them together started to unwind.

      Big trouble now is that many of the folk who knew the systems, network and code have left. So it costs another arm and leg in getting network surveys undertaken, then understand the interdependencies and critical nature of system use.

      Another bite on the bum

      1. hoola Silver badge

        Re: You pays your money...

        I am sure there will be various interested parties lining up to make them agile by moving everything to "the cloud".

        That appears to be the default answer to everything now.

        If the stuff is that old then it is legacy hardware & software but as others have said, the Tax system is so complicated that it is no surprise that the systems behind it are an issue to upgrade/replace/migrate.

        What pisses me off most is the number of shysters that are using the term "legacy" to cover anything that is not running in a public cloud, usually needing their very expensive software (on subscription of course) to make it work. This then frightens managlement into thinking that perfectly viable and happily running systems on prem (not old but the latest OS and applications versions) are going to fail at any minute so they most do something.

      2. Headley_Grange Silver badge

        Re: You pays your money...

        I think that the budgeting is the problem. Governments are in power for 5 years max and politicians of all persuasions know that putting up taxes is a great way to lose elections. So given the choice between spending a bit of money to keep things going till the next election or a lot of money to fix things for a decade or two, its a brave politician who chooses the long term fix.

    4. Anonymous Coward
      Anonymous Coward

      Re: You pays your money...

      >Even without knowing which government department this was it would be plain that said department was run by accountants.

      This is more than a little unfair. HMRC are fundamentally a competent department on the technology front. Self Assessment never falls over, RTI (almost) always works and they delivered the CJSS under pretty challenging circumstances. This is despite FJS rinsing the department for everything it's worth.

      The problems are principally the result of an accumulation of two decades of political decisions, not departmental operations. There's still enormous technical debt hanging around from when HMRC was formed out of the old Revenue and Customs bodies. Since then they've been given no money to fix that, and have been forced to slash tens of thousands of jobs and have had their budget cut in half, all while being forced to deliver on Brexit and now COVID response. All the while the tech debt just kept piling up and piling up.

      I dread to think how bad things would have been if the CHIEF decommissioning project had actually been seriously started prior to the brexit vote. If you think the border is bad now - there were real plans almost enacted that would have left us with _no customs system whatsoever_ for our european border. Only budget cuts and GDS incompetence caused it to be delayed.

      1. TimMaher Silver badge

        Somewhere in Southend...

        Group seat 101 still exists.

        (You have to know to get the joke).

        Mine’s the one with the DWO’s filling all of the pockets.

      2. Anonymous Coward
        Anonymous Coward

        Re: You pays your money...

        This is despite FJS rinsing the department for everything it's worth.

        That's unfair. Fujitsu rinse HMRC because they own VME, on which these systems were built when mainframes were the only game in town for country-scale computing. The high-octane rinsing was done on the systems themselves by CapGemini, which was so spectacular that even the government noticed and in-housed it again.

        If you invite carnivores into your house and invite them to eat you can't be surprised when you lose an arm.

        1. Anonymous Coward
          Anonymous Coward

          Re: You pays your money...

          It should, of course, be noted that the in-house contracts are generally and near-exclusively staffed by the same Capgemini bodies who used to wear Aspire badges but now wear Civil Service contractor badges, supplied by Capgemini at near-equivalent rates.

          Fujitsu's rinsing extends far beyond VME. The rates for the FAST platforms were absolutely crippling, for example, and ensured almost all new applications development or major upgrade programmes were paused until the contract was novated and FJS's exclusivity removed. At which point FJS began their programmes of redundancies, which continue to this day. It was a deliberate strategy of bleed-and-run and they deserve no defence.

  4. Anonymous Coward
    Anonymous Coward

    Don't panic!!!!

    When IR35 comes in April, there will be a lot of highly skill and experience individuals available to fix this, I wonder if the roles will be outside?

    And before the who permie/contractor debate kicks off, why is any company in the future going to employ anyone who they need to pay sick and holiday pay for, training, pension contributions etc. when they can just employ someone inside IR35 and legally not have to provide any of those contributions/benefits or provide any notice period.

    The days of permie staff are coming to an end!

  5. Anonymous Coward
    Anonymous Coward

    Having spent 6 months as a Vendor SME onsight with HMRC I can honestly say that most of the issues are based around Fudgeit, sorry, Fujitsu taking the absolute maximum amount of urine for costs against idiot senior management at HMRC. £60 to plug in a LAN cable to an appliance and no you wont get your money back if the Datacentre troll plugs it into the wrong port. This is after 6 weeks of project planning and general fannying around to get Fujitsu to plug said cable in. This is from the Aspire perspective anyway.

  6. Andy E

    Short sighted madness

    I'm constantly amazed at the number of times organizations will go out and purchase (or develop) a point solution, turn it on and then forget about it. There's never any type of roadmap to keep it current or to evolve it to meet changing business requirements. It's just left to run as is, until something becomes embarrassing (out of support) or it breaks. Unfortunately Government departments set the gold standard in this category.

    1. hoola Silver badge

      Re: Short sighted madness

      Universities are not far behind. Lots of clever people doing clever things in house, often reinventing the wheel may be great but it is an absolute bugger to support when said staff move.

      At the point of implementation it may have been cheaper (though sometimes are really doubt this) but as time goes on the support overheads just keep increasing.

  7. Alister

    "HMRC has recognised that, due to the need in the past to forgo operational maintenance and upgrades to its systems to secure cost savings, its IT systems now constitute a significant risk to the department,"

    And there, ladies and gentlemen, is the root cause of the problem.

    Will they learn from this?


    1. Install big new shiny

    2. Do no maintenance or upgrades for the next ten years

    3. Moan about risk to business.

    4. goto 1

  8. Anonymous Coward
    Anonymous Coward


    Legacy IT kit is behind 80% of UK Government departments.

  9. Lorribot

    The problem is the same in any busines of any size, the account control expenditure and will always go with the least amount of expenditure this year as that makes them look good. They also like OPex as it is nice a predictable and meeans they don't have to think beyond teh end of the tax year. Any one that works in IT knows that is a completly un realistic way to work, planing for end of life projects that need to run over 3 or 4 years for primary LOB systems is almost impossible to do as Finace says no, will just pay this small chunk to keep goin as we are, until the small chunk becomes a big chunk and all the people that made teh stupid decisions moved on 3 years ago.

    The CXOs and top people need to run companies with 5, 10 amd 15 year plans for IT and need to push the finance teams to work with that not just 1 year cycles that are like a giant badly designed snowplough pushing the problems and costs ahead of it till it just just grinds to a halt by the shere weight of teh build up of detrius and junk..... or they get hacked and die a fiery death.

  10. DaemonProcess

    problems start with Parliament

    I've had a 30 year carreer in IT, including passing quite a few technical exams without issue. Before that when I was a tax collector I completely falied to manually correctly calculate the due date for interest payable, also quite a few collectors would swear that different due dates were the correct one and the IT systems themselves weren't ever up-to-date with the legislation which changes each year. This is symptomatic of the complexity of the law as is debated and accepted by Parliament. The UK tax law volumes are huge. VAT is a similar situation - although easy at first principles it rapidly gets out of hand in the real world.

    Sort out the tax law and especially the parallel and even more complicated laws around national insurance, then new IT systems will be easier to introduce.

  11. dr john

    I just submitted my tax return a few days ago.

    I saved the summary form, which shows how much I owed, as a pdf.

    I paid what it said was owed.

    Two days later I logged in and the box about how much I owed was now empty. So the payment had gone through.

    Then just out of interest, I clicked on the View your payments section ( a new feature I think).

    And digging around in there, I read I was now over £1000 in credit!

    Back to the completed return, it still said the tax due was what I had paid!

    So I will be on the phone to them tomorrow (Mondays they often seem to be very busy).

    I think they need an update!

  12. Anonymous Coward
    Anonymous Coward

    I worked for a company that was fronted by Fujitsu to supply software and services around tax return submission (all the tax returns flowed through the software and hardware we provided). Fujitsu were just a commercial wrapper. What we did was modern, or modern enough, it was 10 years ago, but HMRC as a customer seemed clueless. Endless network issues from their side, that we'd have to prove every time were them.

    Why does this always happen?

  13. Chinmusic

    Out of context?

    If you read the report, the line about £53m being spend on IT for the COVID-19 response has nothing to do with the costs of any Legacy Kit. It is more likely to represent the costs of developing the relevant IT systems in a very short timescale, connecting to existing systems and hosting a new front end somewhere expensive.

    It is just buried inside a statement on legacy kit. The rest of which is true. But the two are unrelated.

    So the title is a bit misleading.

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