Boredom’s use as a political weapon is underappreciated. It allows liberties to be filched by stealth, on the wild frontier beyond people’s attention span. Such is the case with Real Time Information (RTI), whose full ‘roll out’ starts with the new fiscal year on 6 April (it’s already being piloted). It’s been described as the biggest change to Pay As You Earn since 1944, when PAYE came in, but few people beyond payroll managers, employers and accountants have heard of it. Under RTI the tedium that shrouds any accountancy-related matter is compounded by the blandness of a clerical rejig. Instead of reporting payroll details to HMRC at the end of the tax year, as now, employers will be ‘invited’ (at two weeks’ notice) to join RTI, where the data are supplied to HMRC in ‘real time’.
Concurrently with RTI, the Department of Work and Pensions is unspooling Universal Credit, another salvo in the asymmetric war against feckless or fiddling welfare-scroungers. The idea is to ‘join up’ PAYE data with the benefit system to stop people in paid work drawing Jobseeker’s Allowance, estimated by the DWP to have cost £4.5 billion in 2011. It’s a juicy plum to claw back from claimants in the current short-rations drive (total benefits not taken up are much higher: on DWP estimates, between £7.5 and £12.3 billion of income-related benefits alone went unclaimed in 2009-10).
RTI amounts to a data bonanza for the state. Full reporting demands over a hundred data items. Since the payroll info has to be logged before or when employees are paid, HMRC will accede to comprehensive information about the entire (legal) working population on a constantly refreshed real-time basis. The All-Party Parliamentary Taxation Group enthuses that ‘RTI is groundbreaking internationally in terms of employer withholding reporting obligations’ – that is, in the amount of dope employers have to cough up – where apparently the UK will be rivalled only by Bulgaria. It gets better: employers have to give HMRC details of all workers’ names and addresses. Late submissions are liable to fines of £100 per error per fifty workers employed; penalties will also be levied on bosses giving inaccurate data on their employees.
the validating requirements for [full reporting] are very high and HMRC will reject an entire file if there is a single error, even if the file contains the information on a large number of employees.
Near the end of its report, the APPTG lets a big one drop. ‘In effect, employers have taken on an additional responsibility under RTI – to ensure their employees’ (including household) benefits are accurate.’ Thus the state scoops the double jackpot of keeping tabs on citizens’ working habits, whereabouts and benefits claims, while outsourcing the cost of doing so to employers. Despite the fines, the burden of installing the IT needed for RTI reporting, and the costs of entering the data, employers have raised little objection to the regime, maybe because RTI encourages them to keep tabs on staff and clamp down on inaccurate time-sheet records. Where employers have trouble getting the hang of the new system, the APPTG notes, ‘this may result in vulnerable individuals experiencing personal financial hardship with a reduction in their benefit calculation.’
What about data protection? In RTI’s consultation phase the government sounded out the Information Commissioner’s Office. It noted that HMRC had failed to implement a Privacy Impact Assessment despite the clear data security issues. I have found no indication that this proposal has been followed up. By contrast, the APPTG urges that UC be seen ‘as the beginning, not the end for sharing real time PAYE data… across government’.
State data creep continues. The home office DNA database – inherited from the police, but which includes many people never charged with a criminal offence – has doubled since 2005 to six million profiles. Now the coalition is reportedly looking at mandatory biometric ID for Romanian and Bulgarian immigrants: maybe this administrative rigour is meant to make the Bulgarians feel at home. No doubt a number of them will find work in the UK’s black economy, as bosses duck RTI to pay off-book workers less than the minimum wage and dodge national insurance.