HM Revenue & Customs’ (HMRC) customer service target has been branded “woefully inadequate” by the Public Accounts Committee (PAC) after 20 million phone calls went unanswered in 2011-12.
A report published by the committee found that it cost callers £136m while they waited to speak to an HMRC adviser last year.
It also revealed that against its target of responding to 80% of letters within 15 days, the department managed to reply to just 66%.
Labour MP Margaret Hodge, chair of the PAC, called it an “abysmal record”.
Its new target of answering 80% of calls within five minutes is “woefully inadequate and unambitious”, according to Hodge.
She added: “HMRC’s ‘customers’ have no choice over whether or not they deal with the department. It is therefore disgraceful to subject them to unacceptable levels of service when they try to contact the department by phone or letter.”
HMRC spent approximately £900m on customer service in 2011-12, around a quarter of its £3.7 billion total expenditure.
It received 79 million phone calls and 25 million items of post in the year, with 20 million of those phone calls unanswered.
The committee warned that HMRC is likely to face more challenges as the new real time information system, the introduction of Universal Credit and child benefit are likely to prompt phone enquiries.
The department also announced last week that it is to close all of its 281 enquiry centres, which provide face-to-face advice to customers.
But it welcomed the planned changes to customer service at HMRC, which include the introduction of a call-back service for customers whose queries cannot be resolved first time, resolution of more queries first time round and the replacement of all 0845 numbers with cheaper 03 numbers.
Under the new target, 16 million people will still be left waiting more than five minutes, which is below the industry benchmark of answering 80% of calls within 20 seconds.
A spokesperson for HMRC said: “This report criticises a previous poor standard of service from which HMRC has already recovered.
“In the past three months, we have been answering more than 90% of calls to our contact centres, and during the current year we have replied to 84.5% of the 16 million pieces of post we have received within 15 working days.”
It confirmed an additional investment of £34m in its contact centres to maintain an industry standard level of performance.
HMRC’s tax credits phone lines have already moved to 0345, while its remaining lines will be moved to 03 numbers from April.