Computer glitches could prove costly for Britain's self-employedgreenspun.com : LUSENET : Grassroots Information Coordination Center (GICC) : One Thread
Lost in a loop Computer glitches could prove costly for Britain's self-employed
A #2 MILLION hole has appeared in the British government's income because an Inland Revenue computer system has failed to collect direct debits for national insurance from self-employed people. With no quick fix in sight, some people are facing unexpected bills of more than #500.
The Inland Revenue's new National Insurance Recording System (NIRS2), which holds records on 65 million individuals, has been plagued by problems. Andersen Consulting designed the #143 million system to record the history of people's national insurance payments for the government's Contributions Agency. An incomplete history of payments can affect certain benefits, including pensions. "It's the largest computer system in Europe," says David Martin of Andersen Consulting.
The commissioning of the computer system was delayed for 18 months and finally introduced in July 1998, when the problems began for self-employed people. The Contributions Agency's responsibility for NIRS2 passed to the Inland Revenue in March 1999. Andersen Consulting has the contract for running the system.
Many self-employed people pay their national insurance contributions automatically by direct debit. This means the Inland Revenue has to request payment from each person's bank account.
The Inland Revenue says that about 5000 people have been affected. Most of their problems are caused by the software wrongly identifying a problem with the direct debit. The customer then gets lost in what the Inland Revenue calls "a loop"--and no request for payment is ever made. Andersen Consulting does not yet know what is causing the problem. The Inland Revenue tells those affected that no remedy is yet in sight for this "recurrent fault with our new computer system".
In the meantime, some people may be blissfully unaware of their mounting debts. This may not bode well for their pensions, says David Willetts, shadow minister for social security. "It will affect the newly retired who won't get their proper benefit."
The NIRS2 has also failed to produce the contributions records of employed people. Some 83 000 pensioners are not getting the right benefit. Says Willetts, "We've had assurance that it is about to be sorted out but it is still dragging on."
-- Martin Thompson (firstname.lastname@example.org), February 24, 2000