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Marking the government’s homework: the Brexit Impact Assessment

October 18, 2019

Impact assessment – no, don’t fall asleep yet – is a boring technical discipline. I know: I used to be the impact assessment specialist for HMRC and for all Treasury tax measures. The point is to regulate how governments regulate – the IA process is actually designed to be a brake or anchor on introducing new legislation. Supposedly you think through the impacts as you design the policy, so that by the time you get to the stage of introducing legislation you’ve already worked out the costs and benefits, got your stakeholders on side, and checked that you aren’t proposing anything that damages small businesses or has equality implications or offends against any other government priority. Actually in civil service terms it’s a fun job if you don’t mind a bit of unpopularity – you get to tell MUCH more senior people that they can’t ride their hobby horse till they fill in this form, and you get to play “my boss is senior to your boss” sometimes all the way up to the Minister’s private office, at which point they tell you to go away and come back when you’ve worked it all out.

So does the Brexit agreement need an impact assessment? Well, does it have an impact on businesses? Yes it does. Is that impact more than £5 million a year? The last draft showed an impact in the billions, so, yes. Can you get out of it by saying Brexit is self-evidently a good thing so a further impact assessment isn’t required? Er, no, that’s not how it works.
(Side note: just a thought, but did they actually negotiate this new agreement without knowing what the costs and benefits of each change might be?)
What can anyone do about it? Judicial review – governments have said publicly (for example this government, here in this document) that they’ll do impact assessments and under what circumstances.
…and here’s the catch. You can bring a judicial review on the grounds of “legitimate expectation” – citizens can expect governments to follow their own rules, and the courts can force them to go back and do their homework properly under those circumstances. But parliament trumps courts: if a change is legislated, you have to assume that parliament understood they hadn’t got the impact assessment they were entitled to expect but decided to do it anyway.
In other words, my reading of the situation is that if someone wanted to bring a judicial review this afternoon they might plausibly argue that parliament couldn’t reasonably vote on the Brexit deal without an updated impact assessment showing the projected costs and benefits. But when the courts close today it’s too late – if the agreement passes on Saturday, then the presumption is that the parliament that passed it knew what they were doing…
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The Palace of Westminster

May 8, 2019

The government has published a “Government response to the report of the Joint Committee on the Draft Parliamentary Buildings (Restoration and Renewal) Bill

What’s this about? Well, essentially the Palace of Westminster – the building that houses the House of Lords, the House of Commons and various offices, chapels and halls – is falling down. It’s a fire risk, bits of it keep falling off and narrowly missing people, and it’s a warren of unsuitable spaces with rubbish access and facilities.

It’s also, apparently, a World Heritage Site (which seems bizarre to me as it was only built in the nineteenth century albeit on top of some medieval buildings and incorporating some remnants) but which means it can’t just be left to rot.

Have we really got between £3-6 BILLION to spend on a building, though, however historic?

Usually the government’s answer to anything expensive is to offload it. Why aren’t we preserving the building by flogging it off to someone else, in the way that the County Hall buildings opposite were preserved? Give it to a hotel group for a peppercorn and let them spend the money?

If you look at more modern parliament buildings like the Scottish Parliament or the EU Parliament they are arranged differently, usually in a semi circle to facilitate civilised discussion rather than the yah-boo-suckery of the two-sides-two-swords-lengths-apart Commons. They have microphones that work and electronic voting systems that don’t rely on parliamentarians being wheeled through the lobbies “sick bucket on lap and high on morphine

So here’s a thought. There’s a perfectly adequate set of offices and chambers across the square, at the 100 Parliament Street building that houses the Treasury and other assorted Departments.

Move Parliamentarians into that.

There’s also a tragically underused circular car park at the heart of the building. Use that to build a twenty-first century debating chamber. Don’t faff about commissioning a new design. There’s an 800 seat theatre in the round sitting in the middle of the Royal Exchange building in Manchester, built in 1976 for a million quid. It’s a proven design using proven technology. A million quid in 1976 is about, what, seven hundred million now. Appoint an architect to oversee the project and give them a fixed seven hundred million budget and a firm closing date, and let them get on with it.

The Treasury? Move it into the Foreign Office building next door. Move the Foreign Office into the next building down Whitehall and so on, till the unlucky (lucky?) losers get to move into the Lord Moon of the Mall pub at the end of the road.

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Till we have faces

March 13, 2019

Brexit has sucked the life out of the last  three years of government and here we are, nothing done, no energy for doing.

Here’s a thought. If a jury can’t reach a conclusion there’s no dishonour in a re-trial. This Parliament will never agree on the May deal, a no deal, a people’s vote or any other possible outcome.

So let’s stop. Don’t ask the EU for a postponement, which would need the unanimous agreement of the other EU members and which they have already said would come with conditions. No: let’s withdraw Article 50 and then do it right.

Set up a Royal Commission to look at what Brexit means: we want from it, how we will act during any transition period and after, the risks and rewards. What May should have done after the election, essentially, so there’s cross party agreement. The Royal Commission should also take advice from a Citizens’ Jury, as was done in Ireland on the abortion debate, an issue at least as toxic as Brexit.

The police investigation into any wrongdoings during the referendum should continue alongside the Commission and any prosecutions should go ahead independent of the Commission’s deliberations.

There would be another election in the usual course of events but campaigning would be on the issues – tax, spending, welfare, education, NHS, defence… and not on the slow grind of Brexit.

A new Parliament would look at the Royal Commission’s plan of action and then vote on whether to trigger Article 50 again, this time with a clear road map of agreed actions, or whether the new proposals should be put back to a new referendum.

One tiny snag, as I’m sure you have noticed… in order to withdraw Article 50, Parliament – this Parliament – would have to vote to do so…

 

 

 

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Alternative visions

November 8, 2018

The Office of Tax Simplification has a vision of the future of tax guidance.  Funnily enough it makes no mention of the previous review (the Good Guidance Guide, also known as the Anderson review) nor for that matter the Guidance on Guidance, a booklet with a yellow cover (sunflowers, I believe) which was current in my day. Maybe it’s a spinal reflex: every ten years or so someone says Something Must Be Done about Guidance, writes a report, and adds it to the shelf.

Not that I’m saying guidance has stayed the same. From manually updated HMRC manuals and printed pamphlets for taxpayers, to Tintax (electronic manuals) for HMRC staff and the grudging move to online for taxpayer guidance, to todays whizzo talk of pop-ups and voice operated search functions, and government mandated web pages with a paragraph of text written in a register with a reading age of nine, we are clearly in a dynamic system.

Which is why it’s disappointing that OTS’ review is so… static. Set up a panel of the Great and the Good. Get a Senior Manager to be in charge. Consult on whether we want HMRC guidance to be binding… It IS the twenty-first century, you know! That’s just not how things are done any more.

So here’s what I’d do. First, watermark all existing HMRC guidance with something that says “this guidance was written before G-day so may be difficult to follow. Seek advice” or words to that effect.

Second, leave HMRC manuals out of this. As I have said elsewhere, HMRC manuals are written to instruct HMRC staff how to administer the tax system, not to advise taxpayers how to interact with the tax system. It’s available to citizens under the Freedom of Information Act – that doesn’t mean it’s written for citizens to use, any more than police radio is intended for easy listening just because your radio might pick it up.

Third, make use of metadata – a webpage might well only have one paragraph of text on it, but with minimal work it should also be able to tell you when it was written (and by whom), where to go next for more detail, and have a clickable link to archived previous versions.

Fourthly, integrate guidance vertically as well as horizontally. By “horizontally” I mean across levels of expertise – taxpayer, practitioner, specialist. And by vertically I mean that even the simplest guidance should also be capable of further exploration (a “for more detail click here” link) that takes you from taxpayer to practitioner to specialist guidance and ultimately to the actual legislation. Don’t get me started about the state of the legislation online, but seriously the government buys its own legislation back from commercial firms because it can’t be arsed to update it properly and talk about don’t spoil the ship for a ha’p’orth of tar.

Yes, set up a supervisory panel… of retired teachers and other similar volunteers. Not the “tax community” who are big enough and ugly enough to argue their own corner with the revenue. No, the voices that aren’t being heard here are the taxpayer community, the actual citizens affected by this, who may have strong views on how they want to find out about the legislation that affects them.

And then write the new stuff collectively. Or, rather, keep guidance divided into three parts. The simple instruction/write according to gov.uk standards so a nine year old can read it/drop down and pop up help that comes with the HMRC forms, fine. That’s a customer service function. Fund it. Let HMRC write it. It will pay for itself. The HMRC guidance for its staff? Leave it alone: let HMRC keep it, use it, update it, and publish it under FOI. But don’t mistake it for taxpayer guidance. No, that’s the third layer: the “can I claim for a painting under the plant and machinery rules” “is there still a tax exemption for keeping a horse” “how do I claim for research and development” level of guidance.

Which – it’s the twenty first century after all – we should wiki.

Yes, you read it right. Use the wikipedia model. When I was last an HMRC policy worker, we actually had a wiki, sharing internal advice across different government departments. My staff wrote the guidance on how to produce a TIIN and kept an eye on any edits, but it was helpful for the people who “owned” the policy on, say, equality to be able to edit or expand on or add links to the relevant bit of the guidance rather than one person have to know everything about everything.

Set up a tax guidance site on the wikipedia model. How to stop people trolling it? Sign in via your taxpayer ID (the government gateway or equivalent) How to tell whether it’s accurate? It’s a dynamic system but it’s hallmarked with the date and time and name of the last person contributing, and with specific rules about how a page may be edited and why. It’s very far from perfect but then so is HMRC’s existing guidance. So, yes, let’s have a collaboration between the tax profession, HMRC and the interested taxpaying population. But let’s do it twenty-first century style.

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Bread and butter

October 9, 2018

The hopelessness, it gets to you.

You look at the world, at politics, economics, climate change, and you think, it’s all so big and so hopeless and so utterly, utterly fucked that there’s just no point in anything…

Nevertheless. Insert platitudinous inspirational meme here. We can’t go on. We go on.

Anyway. Did you know we have a Minister for Small Business? Well, actually a Parliamentary Under Secretary of State, Minister for Small Business, Consumers and Corporate Responsibility? It’s Kelly Tolhurst MP and she’s only been in post since July of this year, so I suppose we must let her off.

Because small businesses are being screwed. Again. Well, not small businesses, as such, but micro businesses. You know, the ones who aren’t represented by the CBI or the FSB, the ones which barely have a need for an accountant let alone someone to read policy documents for them and represent them at HMRC “Stakeholder” groups.

In the beginning there was administrative burden, which is the cost of dealing with the government – not the money the government takes from you in taxes etc, but the money it costs you to comply with the regulations they make like filling in the necessary forms to tell them how much tax you’re going to have to pay. And the UK had the highest VAT threshold in the EU because that took bazillions of micro businesses out of VAT and cut the administrative burden by gazillions.

Then there was Amazon, who hoovered up the business of selling ebooks and they did it from a low-VAT-on-ebooks jurisdiction. So the EU introduced rules to make the VAT chargeable where the buyer was located, not the seller, and in solving one problem they created another, because there were a load of authors who sold their ebooks directly from their own websites rather than paying a substantial proportion of the turnover to Amazon or another platform.

Because those authors (and the knitters selling patterns and the musicians selling sheet music and the trainers selling online courses…) weren’t represented by any “stakeholder” group and because neither HMRC not the EU did due diligence on the impact on micro businesses, no-one realised they were literally unable to comply with the legislation as originally envisaged, well, they were fucked.

Fair play to the micro businesses of Great Britain, though, because they got together and lobbied their little hearts out and crowdfunded to go to Ecofin in Dublin and lobbied the EU and… won. There’s a €10,000 Euro turnover threshold below which the new rules won’t apply, so Amazon and the like are hit but the one-woman kitchen-table business isn’t. Result?

So you might think.

The legislation comes into force on 1 January 2019. Unless something happens, the UK leaves the EU on 29th March 2019. The micro businesses of Britain have a whole 87 days to trade legally and friction free.

After that? Not only do they not get the concessionary treatment for micro businesses and the simplified system for small businesses, they don’t even get the “benefit” of being able to transact via the VATMOSS system with the protection of HMRC between them and the other EU fiscs. They become “non-union” traders and are expected to work out the rate of VAT applying in the location of their customer at the exchange rate on the day of the transaction…

It’s rubbish, and (according to the campaign group) the British government haven’t even asked for relief, or for a continuation of the de minimis threshold, after Brexit.

Oh, and there’s talk of lowering the VAT registration threshold. Because the one thing we need from Brexit is more red tape and administrative burden, right?  I mean, right?

Dear Kelly Tolhurst MP, can you please remember the very smallest businesses and look at the VATMOSS mess?

I can’t even. It’s worse than the music hall. The circus. The music hall.

 

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Day one

July 2, 2018

I guess there’s a timing issue I hadn’t thought of (I haven’t had the daily email round up of consultations yet today and I can’t honestly recall whether it arrives the same time every day or not) but a quick check of the gov.uk website shows only one consultation has been published today, or at least that was all there was when I started writing.

It’s a code of practice for Forensic Gait Analysis (FGA) published by the Forensic Science Regulator, an agency of the Home Office.  I thought I’d just speed read it but actually it’s more interesting than I’d expected.  I mean, “forensic gait analysis” is the pseudoscience of identifying people by the way they walk.  As it says in the paragraph “limitations of service”:

  1. forensic gait analysis predominantly relies on observational analysis and comparison, rather than measurable objective techniques;
  2. features of gait have discriminatory potential but cannot currently be used to identify a person in isolation or from an open population;

which makes sense, because if you think about it you can identify your partner or your child or parent in a crowd without being able to see their face, just by the way they move.  But if you notice someone with a distinctive red hat and then a few days later see someone in a similar hat, could you identify them as the same person from the way they walked?  From examining video of the way they walked?  I know I couldn’t – but then would I be able to if I trained as a Forensic Gait Analyst?  And would you want to go to court reliant on my evidence if I did?

So I speed read the CoP and it looked reasonably sensible – I’d like to see someone with experience of the use of FGA in court read and comment on it, but no doubt legal networks are or will become aware of the consultation and be on it.  The bit that worried me was:

17.1.4 Methods used by the Forensic Unit can be acquired by:-

i)  developing a new method within the Forensic Unit;

OK, so you can develop an innovative way of undertaking FGA.  But how do we know it works?  Ah.  You have to have it validated.  And how do you have it validated?

17.2.1 When validating a method for use in forensic gait analysis the Forensic Unit shall:

i) determine the end-user’s requirements;

ii) determine the specification of the method;

iii)  conduct a risk assessment of the method;

iv)  review the end-user requirements and specification;

v)  define the acceptance criteria for the method;

vi)  produce a validation plan for the method;

vii)  detail the outcomes of the validation exercise;

viii)  independently assess the validation work to ensure the method complies with the acceptance criteria for the specification;

ix)  produce a validation report;

x)  produce a statement of validation completion; and

xi)  devise a plan for implementation and monitoring of the method.

Is it just my nasty suspicious nature that reads this as “invent your own method, and then write a report that shows how well it works and how carefully you’re going to use it”?  Although to be fair 17.2.3 goes on to say they expect most of the validation will be done by peer reviewed academic study.

When I skimmed to the end it finally clicked what I was looking at.  This ought to be an internal manual: how to run this bit of your forensic department.  It might be made public for FoI purposes but no-one except those affected would ever trouble to look at it.  It needs to be a code of practice because we’ve outsourced this kind of work to profit-taking entities, people for whom the idea that they should have “facilities [that] cater for the safe storage of casefiles to maintain the integrity and identity of technical records” is not a given.

The kind of people, in fact, who need a forensic science regulator in the first place.

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Start here

July 1, 2018

It’s hard to believe this blog has been in existence since April 2012, when I was a newly-retired Inspector of Taxes.  It’s even harder to believe that, when I first thought about bloggery, I seriously thought I would follow and respond to all government consultations for a year: I had no idea, even after working within government on the consultation process, quite how many consultations there are.

We have come a long way in six and a bit years.  Gov.uk tells me it had 591 documents on the consultations page when I launched: there are now 4344, 74 of which are open consultations.

Using the gov.uk sort facility again we can see that there were 254 documents published between the first of April 2012 and the end of March 2013 (and this number is, of course, just a proxy for the number of consultations published during that period, as it will include consultation responses published during the period in response to earlier condocs, as well as condocs “live” in the year and other oddments like calls for evidence and further supporting documents)

Nevertheless, looking at the year on year totals from April to the following March we see:

254 in 12-13

594 in 13-14

839 in 14-15

531 in 15-16

578 in 16-17

675 in 17-18

I’m not sure about these figures: I’d like to know how many open consultations there were on hand at any given time but I haven’t yet worked out how to extract the figure from the gov.uk website (nor do I have any empirical evidence of how accurate the gov.uk sort function is in producing figures in the first place).  Nevertheless my impression – and it’s no more than that – is that the number of consultations has reduced lately, and I have, perhaps lazily, assumed this was because of Brexit and the concentration of civil service resource elsewhere.

However one useful change over the period I have been blogging is that they finally fixed the subscription function, so that the request to have details of published consultations emailed to one every day now actually works.

So I thought, what if I just… try to blog more often.  Every day, ideally, about what comes in?  And get some actual figures.

Watch this space.