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TAX NEWS: Tax credits 'wrongly paid to migrants'. By Dan Martin

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13th Jun 2006
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Tax credits which could be worth millions of pounds have been paid to immigrants who were not entitled to receive them, the BBC has claimed.

An Inland Revenue document obtained by the broadcaster under the Freedom of Information Act suggested that between April 2003 and December 2004 2,700 migrants were wrongly paid the credits because benefit office workers were instructed to ignore any irregularities in claims.

The only requirement was a national insurance (NI) number. Earlier this month, it was revealed that thousands of workers suspected of being illegal immigrants were given NI numbers.

The BBC said with overpayments averaging £1,000 a year, it would amount to at least £2.7 million if all 2,700 migrant families had claimed for the whole of the period covered.

Speaking to BBC Radio 4's 'Today' programme, Liberal Democrats work and pensions spokesman David Laws accused the government of carelessness.

"The Treasury was relying on the DWP, the DWP was relying on the Home Office and the Home Office doesn't seem to have been doing its job."

David Laws, Liberal Democrats work and pensions spokesman

"It appears that, from then on for about 18 months, the Treasury was relying on the Department for Work and Pensions to issue National Insurance numbers as a proper check on people's entitlement to work here," he said.

"But we now know that the DWP was not actually putting in place the proper immigration checks.

"The Treasury was relying on the DWP, the DWP was relying on the Home Office and the Home Office doesn't seem to have been doing its job, and as a consequence millions of pounds have been paid out in tax credits, and possibly in benefits as well, which shouldn't have been paid out."

The revelations are the latest scandal to hit the government's flagship tax credit system.

Overpayments have totalled around £2 billion for the past two years, while the treasury select committee recently accused HM Revenue & Customs of playing down the role it has had to play in errors.

There have also been calls for paymaster general Dawn Primarolo, the minister responsible for tax credits, to resign.

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By User deleted
14th Jun 2006 12:31

2006/7 overpayments magically disappear
Of course with no clawback of tax credits for 2006/7 unless your income changes by more than £25,000 as opposed to the £2,500 it used to be ....one assumes the government will be claiming a major success next year...because the overpayments figure will have magically dropped.......BUT in reality the "overpayments" will still have been made but will no longer be called that...and possibly will not even be quantified!!
Scandalous!

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By anniemanly
14th Jun 2006 17:15

and employers have to do far more...
it is indeed scandalous - presumably the checks were side-stepped because the whole scheme had been so badly introduced and was so far in arrears that there "wasn't time" for them to do the job properly

but there is no need to even consider whether the same reason/excuse could be used in mitigation by an employer who takes on someone and does not carry out ALL the relevant ID checks! Failure is not a slap on the wrist - but a criminal offence

An employer is not even entitled to assume anything about an individual from a current and valid CIS certificate or card, because the Inland Revenue, whoops, HM Customs & Excise, do not carry out the relevant checks either before issuing these.

The guidance issued to employers following the introduction on 1 May 2004 of new legislation aimed at preventing "illegal working" specifically states that a card or certificate issued under the Construction Industry scheme does not count as evidence.

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