Saving Gateway Accounts Bill

Amendment 41 seeks to add a new subsection to Clause 12, which deals with HMRC recovering payments, and, as with practically the whole of the Bill, is a regulation-making power. We can see that HMRC needs powers to get back money which has been incorrectly paid; the issue is whether any limits should be placed on this regulation-making power. Amendment 41 seeks to constrain these regulations. It states that where HMRC has made an error or mistake, recovery should be permitted only if the person required to account for it contributed to the error or mistake. This is very similar to the definition of official error which I believe is used by HMRC for tax credits, which constrains HMRC’s ability to pursue overpayments due to errors of its own officers. The draft regulations contain provisions which are much more draconian than this and specifically allow recovery in the case of official mistake whether or not the account provider or the account holder had anything to do with the error. That is the effect of paragraph 2(b) of regulation 20 of the draft regulations. While HMRC might have no mercy for account providers, the position of account holders is different and, as a minimum, they should not be pursued for HMRC’s own errors where they have not contributed to them. My amendment does not differentiate between account providers and account holders and I would be open to a more restricted amendment. Alternatively, the Government might wish to reconsider their draft regulations. It seems to me that HMRC should adopt the same kind of rule it adopts for tax credits and not the most draconian rule it can find in its toolbox back at headquarters. I beg to move.