Select Committee on Public Accounts Minutes of Evidence

Examination of Witnesses (Questions 140 - 145)



  140. Is that a yes or a no?
  (Mr Montagu) It is that I have no evidence that there is large scale fraud and evasion by large construction companies.

  141. Are you targeting these people at all?
  (Mr Montagu) We are targeting the construction industry as a whole in the way that I have indicated.

  142. Could I finally come back to the point I made about whether you are willing to co-operate with people in the industry? It is my impression that it has been indicated by the Inland Revenue that you are not willing to co-operate with UCATT to investigate these things. If you are, which is what I think you said to me, then I will certainly go back to them and say that, and I look forward to hearing in future how such co-operation develops.
  (Mr Montagu) Of course. As I have indicated, we are always happy to work with any third parties who can give us indications of areas where we need to take action to ensure compliance with tax obligations. I would be very happy in those circumstances to work with UCAT.

Mr Rendel

  143. I had not had the chance to do the mental arithmetic quite as quickly as Mr Williams while I was asking my questions earlier, Mr Montagu, but it does seem to me that you have now told us that just over 110,000 people are owed on average, you believe, some £200 or thereabouts, and all you are prepared to do is send them a single computer produced letter to the last address which you know for them, which is likely to be a 1997/98 address. That is three and a half years ago. My understanding is that people move address on average every seven years, so something like half of those people will probably have moved from the address to which you are going to send them the letter. Do you not think you ought to be doing something rather better than that to try and make sure you contact all these people?
  (Mr Montagu) We come back to the same point, Mr Rendel. If we knew that these people had overpaid we would have repaid them. We do not know who among these 1.04 million are the 13 per cent, assuming our sampling is right, who have either paid us too much or paid us too little. That is why I think that all we can sensibly do is our best to contact the 1.04 million and give them the opportunity, if they think they have paid, or indeed underpaid, to tell us so and prove it.

  144. If you were to send them a special delivery letter so they have to sign if they have received it, you at least then would have some idea about how many of those have not received your letter and you could at least then contact their last employer.
  (Mr Montagu) I also have to consider the balancing cost against the point that you are making, that if I sent a recorded delivery notice, and you believe that a lot of these people have actually moved, again it is the same discussion I had with Mr Williams. I have to balance value for money considerations here.

  145. You have to do your best to make sure that people who have overpaid tax get the tax back.
  (Mr Montagu) Within reasonable constraints of value for money.

  Chairman: It simply remains for me to thank you for coming and for a very interesting session.

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