Senior officials from HM Revenue and Customs (HMRC) are set to face intense questioning from the Treasury select committee this Tuesday over a controversial anti-fraud operation that saw thousands of families stripped of child benefit payments.
A 'Tolerable' Risk with Devastating Consequences
Internal documents, released under freedom of information laws, show that tax authorities proceeded with the crackdown despite acknowledging a risk that the data used could be wrong. HMRC assessed the chance of inflicting harm as 'remote' and the overall risk as 'tolerable'.
This assessment was made even though a pilot scheme had revealed that travel data was incorrect in a staggering 46% of cases. Furthermore, of those investigated for suspected fraud during that pilot, more than a third were later confirmed to be legitimate claimants.
The flawed operation, which ran from July to October, led to the suspension of almost 24,000 child benefit accounts. Parents received letters citing overseas holidays—sometimes from as long as three years ago—for which the Home Office had no record of a return journey to the UK.
Flawed Data and Human Hardship
By the end of November, the scale of the error became clear. Almost 15,000 families had been reinstated as legitimate claimants, while only 1,019 (4.3%) were found to involve incorrect claims. Thousands of cases remain unresolved, with the number of wronged families expected to rise.
The human impact of the policy has been severe. Officials reportedly believed the 'severity of the harm' was 'minimal', but affected families have described considerable stress and financial difficulty as they scrambled to prove they had not emigrated.
Distressing cases uncovered by media investigations include:
- A woman who travelled to France to collect her husband's remains after his death, but was flagged because the Home Office had no record of her return.
- A parent who attended his sister's funeral in Dublin, but whose return flight from Dublin to Bristol was not logged.
- A mother in intensive care with sepsis at the time she was allegedly supposed to have emigrated.
- A family who abandoned a holiday when a child had an epileptic seizure at the airport departure gate, yet still had their benefit stopped.
Documents show that during the wider rollout, officials removed checks against PAYE records to 'streamline' the process—a decision that significantly contributed to the widespread errors.
Scrutiny and Systemic Failure
The Treasury select committee, which last year accused HMRC of being 'cavalier with people's finances', will now demand answers. The data protection impact assessment (DPIA) for the scheme has also been heavily criticised.
Mariano delli Santi of the Open Rights Group stated the documents show the DPIA was 'conducted poorly', arguing its purpose is to gather feedback and identify risks, not merely to inform.
In response to the scandal, HMRC has stated it has introduced new systems. A spokesperson said the department now cross-checks data and gives customers a month to provide evidence and confirm they are living in the UK before any payment suspension occurs.
'International travel data gives an indication that a customer may no longer be eligible for child benefit,' the spokesperson said. 'We then conduct our own checks and open inquiries where necessary... before making any decisions on eligibility.'
