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Why closing down HMRC’s network won’t save money either

November 22, 2015

A correspondent draws my attention to another reason why closing down HMRC’s network offices to concentrate in 13 regional centres is a bad bad bad idea.  It may not save the money anyway.

As I already suggested, it seems unlikely that HMRC can achieve spectacular savings in rent by announcing its preferred locations and only *then* negotiating for new premises.  I know office space isn’t exactly at a premium outside of London but are there really modern buildings which can house thousands of staff to be had for the asking?  There are unlikely to be so many suitable premises in each location that HMRC can sit back and expect a reverse premium for their willingness to move in: is it not much more likely that landlords will have seen them coming and hold out for substantial rents, as high or higher than the sum of the small office spaces being given up?

My correspondent, however, also suggests it is worth a look at the costs and patterns of employment.  In Wales, Scotland and for much of England it seems there are jobs being moved from areas of high unemployment to areas of low unemployment.  The current prediction is that 90% of the affected staff can move with their jobs to the new locations.  However around 70% of HMRC’s staff are in junior grades and – my correspondent suggests – 70% of those junior grades are part-timers on fewer than 20 hours a week.  Junior staff who are in part time work tend to be mainly women, mainly because they have other responsibilities.  This is a demographic unlikely to be able to commute for an extra hour each way every day. It’s a plan put together by people in London, for whom and hour and a half commute each way is a regrettable fact of life if you want to live somewhere bigger than a rabbit hutch.  Outside of London, however, the work/life balance is different.

So how will that work out? If someone is offered a post in one of the new HMRC Regional Centres an accepts it, will HMRC have to pay the excess travel costs, at least for the first year or so, as is usual in the Civil Service?

If the office space is expensive and employment costs increase, then how will there be savings?

The only savings I can see come from, well, shafting the employees.  If someone refuses a transfer to an office an hour and a half away, will they then  be considered to have made themselves voluntarily unemployed?  With the civil service pay cap and the abolition of pay progression, any new employee taken on to replace them would be on the lowest point on the scale and likely to stay there.  So you exchange one employee on a decent salary and one person on jobseekers allowance for one new employee on a lower salary and one former employee on… nothing at all.  Ka ching?

One comment

  1. […] plan to close down its local network and move to massive regional centres is a bad idea (see here, here and here for […]



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