5000 People In Powys To Pay Back £4.3m In Tax Credit Overpayments - Opik & Williams

4.11.58pm UTC (GMT +0000) Thu 1st Jun 2006

Powys MPs, Lembit Opik and Roger Williams today called for a total overhaul of the tax credit system after new figures revealed that nearly 10,000 people living in Cardiff are still being forced to payback over £8.4 million worth of tax credits, due to errors made by the HM Revenue and Customs.

Commenting, Lembit Opik, Welsh Liberal Democrat MP for Montgomeryshire, said:

"The Government is failing families across Powys. It's simply unacceptable that we're still seeing systemic failures on this scale.

"1 in 3 tax credits awarded to people living in Powys was overpaid. In total nearly 5000 people will have to pay back £4.3m to the Revenue.

"When you count the 2,400 people who were underpaid, it seems that 1 in 2 tax credits issued in Powys was wrong!"

Roger Williams, Welsh Liberal Democrat MP for Brecon and Radnorshire, said:

"These errors are seriously harming our most vulnerable families. With over half of all incorrect payments were to individuals on incomes below £20,000, it's clear that this malfunctioning system is failing the families most in need of help.

"The Government has to take responsibility for these massive errors. Paymaster General Dawn Primarolo has known of the systemic failures in the tax credit system for years and today's figures are yet more evidence that too little has been done to rectify them. New ministerial leadership is now needed to introduce a radical overhaul of the way tax credits are administered."

ENDS

Notes to the Editors:

15,100 Child and Working Tax Credits were awarded to people living in Powys in 2004-2005.

4,900 (32%) of these awards were overpaid to Powys residents at a total value of £4.3m.

2,400 (16%) of the awards were underpaid.

In total 48% of awards in Powys were incorrect.

The data on tax credits overpayments can be found at http://www.hmrc.gov.uk/news/index.htm