§ Mr. Michael Morris
asked the Chancellor of the Exchequer whether he is able to advise on the result of the pilot study on pay-as-you-earn files and their contents.
§ Mr. Ridley
I announced to the House last year [Vol. 28, c. 182] — that we have concluded that for the majority of people who pay tax under pay-as-you-earn much of the material held in tax office files is retained unnecessarily. Following responses to a consultative paper I authorised the Inland Revenue to proceed with a pilot study in 11 tax offices to test whether it is necessary to preserve all communications, and to maintain separate files, for those taxpayers who are not required to make a return of income annually. The pilot study has recently been completed and has shown that it is possible to deal satisfactorily with the affairs of many taxpayers with far fewer records than at present and that such an approach will yield significant staff savings. Details of the study are contained in an interim evaluation report a copy of which is being placed in the House of Commons Library today. In view of the successful outcome of the feasibility study the Inland Revenue, with my approval, has decided to extend nationally later this year the new methods of working for those taxpayers who are not required to make 535W a return of income annually. The Department will be holding full discussions with its trade unions on the implementation process.