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"£3.2 million West Fife tax credit shambles hits local families" - Rennie
May 22, 2007 5:02 PM
Gordon Brown must fundamentally reform tax credits after new figures today showed that nearly 5,000 West Fife families received the wrong payment in 2005/6.
The figures show that in 3,400 West Fife families had overpayments totalling £2.5 million and a further 1,400 families had underpayments totalling £700,000. With 11,500 people in Dunfermline and West Fife receiving tax credits, 42% of all payments in the constituency were incorrect.
Liberal Democrat MP Willie Rennie said:
"The chaos in the tax credit system is continuing year after year, causing real financial hardship for thousands of hard-pressed local families that the Government is supposed to be helping.
"These incorrect payments mean thousands of families have had their income substantially reduced and are plunged into debt as the Government seeks to claw money back.
"Many people are unfairly forced to repay overpayments when their only mistake is failing to spot an official error on a complex form. It is a disgrace Gordon Brown has so far failed to implement the majority of the Parliamentary Ombudsman's recommendations on tax credits which were made two years ago.
"Many local people have sought my assistance to sort out their tax credit difficulties. Some have received demands from the government to repay thousands of pounds even though this so called debt has accumulated through no fault of their own.
"Mr Brown must fundamentally reform tax credits to deliver stability for those on low incomes, a fairer policy on recovery of overpayments due to official error, and an independent right of appeal. If he wants to show that he is fit to be Prime Minister, he must sort this mess out before he leaves the Treasury."
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