MPs ask HMRC to explain child benefit error that froze payments to parents | Child benefits

MPs are demanding answers from HMRC over the child benefit bug that saw payments stopped to 23,500 families as part of the fight against fraud.

Meg Hillier, a Labor MP and chair of the House of Commons Treasury select committee, wrote to HMRC permanent secretary asking who made the decisions, why they were made and whether compensation would be offered to victims.

The letter follows a series of reports by the Guardian and investigative website Detail about families unfairly suspected of fraud after data showed they flew out of the country but did not return.

They received letters demanding they answer 73 questions and provide a mountain of documents, including bank statements, GP and school records, behind information provided by the Home Office.

But incomplete Home Office data and failure to record parents’ return journeys led HMRC to believe families had emigrated and continued to collect child benefit illegally.

A mother named Sally described how her child benefit was stopped based on data showing she went to Italy in July 2023 and never returned.

It was revealed that Sally and her three children had registered for the flight, but did not board the plane after one of the children had an epileptic seizure at the departure gate.

Another woman accused of immigrating and fraudulently claiming child benefit said she had booked a trip to Oslo but never checked in after the wedding she was invited to was cancelled.

HMRC apologized twice and said it had reintroduced child benefit to around 2,000 parents so far. It asked parents who received the letter to call the phone number on the letter and promised a quick resolution by a new, dedicated customer service team.

He also said he was confident most payments were suspended correctly.

Hillier wants to know what assurances parents will have that this won’t happen again.

“Is anyone who has not boarded a plane, train or ferry leaving the UK this year at risk of being deemed to have migrated?” he asked.

Addressing concerns from many that individuals’ tax records have been corrupted, he added: “Will HMRC’s assessment of immigration status affect individuals for immigration purposes or their non-resident tax status?”

Other questions in the list of 14 requests include how long HMRC uses travel booking data to “determine immigration status”. Lawmakers also want to know why he used booking data and not boarding data.

They also asked how HMRC determined immigration status when travel operators had no idea who was or was not a UK resident: “Given that travel operators do not hold passengers’ national insurance numbers, how did HMRC verify that it had withheld payments from the correct recipients?”

The committee, which will publish the responses, also wants to know what level of seniority was involved in signing the anti-fraud initiative and what measures were taken to prevent innocent victims from being caught up in the crackdown.

This week several parents told the Guardian they had received a letter from HMRC even though they had not received child benefit for months or several years.

Many complained that they felt they were being “treated like criminals” even though they had been paying tax all their lives, and that HMRC could check their tax records to see if they had lived and paid tax in the UK.

Another woman who had previously had a stroke said the letter was very upsetting.

“This type of traumatic situation can cause serious health deterioration in someone like me who has already had a minor stroke. Having to deal with providing A-Z information to prove that I’m not going abroad puts a lot of pressure on top of the tons of stress that is already a part of our lives,” said Rachel.

An HMRC spokesman said: “We are very sorry to those whose payments were wrongly suspended. After reviewing our processes, we check claims from our customers before suspending any payments and give them one month to call or write back.”

“We have a duty to protect taxpayers’ money, but we have also listened to our customers and acted quickly to ensure claims are only suspended where appropriate.”