HC Deb 05 July 1995 vol 263 cc294-6W
Mr. Jim Cousins

To ask the Secretary of State for Social Security (1) how many staff he has devoted to ensuring that employers are properly paying national insurance contributions in respect of those they employ. [31273]

(2) how many cases for recovery of (a) underpayment and (b) non-payment of national insurance contributions his staff have pursued in each of the last three complete years; how much extra revenue for the national insurance fund was recovered; in how many cases formal action through the courts was undertaken. [31274]

Mr. Arbuthnot

The administration of the national insurance scheme is a matter for Mrs. Faith Boardman, the chief executive of the Contributions Agency. She will write to the hon. Member.

Letter from Mrs. Faith Boardman to Mr. Jim Cousins, dated 4 July 1995:

As Chief Executive of the Contributions Agency, I have responsibility for answering questions about operational matters relating to the Agency and the National Insurance (NI) scheme. I have been asked to reply to your questions about the numbers of staff ensuring employers are paying National Insurance contributions (NICs) and about details of recovery of underpayment and non-payment of NICs. In view of the nature of the questions I have combined the responses.

Unfortunately the information is not available exactly in the form that you have requested.

One of the Agency's main aims is to ensure compliance with the law in respect of NICs. The operational area in regular face-to-face contact with employers is Field Operations, whose NI inspectors visit over 100,000 employers each year to monitor their compliance with NI law. There are currently 3,440 staff in post in Field Operations, including as at 31 March 1995 1,780 staff holding Inspectors' Warrants.

In addition to the Agency's Field Operations inspectorate force a number of our other operational sections, centrally based on Tyneside, are also concerned with correcting errors made by employers in their payment of NICs and pursuing collection of any arrears identified.

As far as the pursuit of arrears of NICs from employers is concerned, separate statistics are not kept that allow us to differentiate between cases where NICs have not been paid, rather than underpaid. Whenever inspectors survey (visit) an employer they will ensure that action is taken to correct any mistakes. In cases where earlier tax years are concerned the inspector will arrange to collect any arrears due or refer the case to Inland Revenue Audit, under liaison arrangements, for them to arrange collection.

Details of the numbers of surveys undertaken in the three years 1991/92, 1992/93 and 1993/94, together with the number where errors were discovered and the sums subsequently collected are given in the table I am attaching as Annex 1. Results for 1994/95 have not yet been finalised.

In general, self-employed people have a liability to pay Class 2 NICs unless they hold a certificate of exception from payment on the grounds of low earnings. During 1994/95 the Agency pro-actively identified 50,748 persons with an immediate requirement to pay Class 2 contributions. Similar figures for earlier years were not kept.

The table in Annex 2 shows the number of cases in which a summons or writ was issued by either the Agency or the Department's Solicitor's office in each of the last three years. Figures are also given for the number of cases where summonses were issued by the Scottish Office on behalf of the Agency.

The table in Annex 3 shows the number of cases authorised for criminal prosecution in each of the last three years. Records have not been kept of the number of these cases which finally resulted in a Court Hearing. Not all cases in which criminal prosecution was authorised relate to non-payment or underpayment of NICs; some will have resulted from other offences against the NI Acts, and separate figures are not kept.

I regret that I have been unable to answer the precise questions that you have raised, but I hope that my reply proves helpful. Please let me know if I can be of any further assistance.

Results of contributions agency surveys
Year Number of surveys Number where errors found Amount of NIC's collected by CA £ million IR1 £ million
1991–92 106,422 48,546 5.00 6.31
1992–93 118,038 467,899 8.78 10.61
1993–94 131,634 656,145 15.69 11.30
1 Under Liaison arrangements some arrers of national Insurance contirbutions identified on survey are collected by Inland Revenue.
Annex 2: Number of Civil Proceedings Cases
1Number of Summons/Writs Issued
Year CRS Solicitors Scotland
1992–93 36,929 3,451 1,780
1993–94 58,409 2,467 2,256
1994–95 71,368 1,213 2,172
1 The figure for Solicitor's Office includes cases where formal action was commenced on Insolvency or Bankruptcy procedures.
Annex 3: Criminal proceedings cases
Year Number of cases authorized
1992–93 81
1993–94 53
1994–95 13