Shake-up urged for tax credits system

The tax credits system must be urgently reformed if public confidence in the policy is to be restored, campaigners say.

In an action plan issued last week and sent to paymaster general Dawn Primarolo, the Child Poverty Action Group called for an amnesty on all tax credit overpayments up to April 2005 where fraud is unproven.

It also recommended a “fair” recovery of overpayments so that families are not left in extreme hardship and that claimants should have the right to challenge decisions on recovering payments.

The charity also called for tax officials to be based in jobcentres and offer advice.

Kate Green, chief executive of CPAG, said: “The government must address the administrative problems so families no longer have to battle against incomprehensible decisions and impenetrable bureaucracy.”