Tax credits time bomb threatens to explode

Times of London ^ | 07/27/08 | Jon Ungoed-Thomas

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Tax credits time bomb threatens to explode

The nation will face a bill for £2.8 billion

Jon Ungoed-Thomas

ON February 26 last year, a manila envelope crammed full of documents arrived at a house on the Isle of Wight. Inside was a dossier that amounted to a detailed indictment of the tax credit fiasco that will cost the country as much as £2.8 billion.

The documents - and tapes of telephone conversations that arrived some weeks later - were obtained under data protection laws and detailed the tax credit claim of Simon Blackmore, 38. He was being pursued for £6,057 in tax credits.

“Screen grabs” of Blackmore’s case provide a snapshop of a system on the brink of chaos. Software glitches caused a series of errors on Blackmore’s files, including the wrong income details and the removal of his six-year-old daughter from some of the assessments. Faced with Blackmore’s dossier, HM Revenue & Customs (HMRC) relented last Thursday and told him he would no longer be pursued for the alleged overpayments of 2003 and 2004.

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The comments made me go look at this.

The Speenhamland system was an amendment to the old Poor Law or Elizabethan Poor Law, created as an indirect result of Britain’s involvements in the French Wars (1793 - 1815). The system was named after a 1795 meeting at the Pelican Inn in Speenhamland, Berkshire where a number of local magistrates devised the system as a means to alleviate the duress caused by a spike in grain prices. The increase in the price of grain most likely occurred simply as a result of a poor harvest in the years 1795-96, though at the time this was subject to great debate. Many blamed middlemen and hoarders as the ultimate architects of the shortage. The authorities in Speenhamland approved a means-tested sliding-scale of wage supplements in order to mitigate the worst effects of rural poverty.

http://en.wikipedia.org/wiki/Speenhamland