The Inland Revenue's decision yesterday (30 May) to suspend its
flagship online tax filing system following a security breach is a
huge embarrassment for prome minister Tony Blair.
The service was halted after users told the Revenue last weekend
that when they logged they had access to other people's tax
details.
The Inland Revenue prides itself on pioneering e-government and the
online self-assessment service, launched in 2000, was supposed to
be the flagship of new interactive government services.
However, the service, provided by outsourcer EDS, was delivered
late, was quickly suspended for upgrades, and was heavily
criticised for its complexity.
The latest security failing adds weight to a National Audit Office
warning in April that Tony Blair's e-government efforts could be a
waste of money unless Whitehall departments improve sharply.
The NAO attacked Whitehall for its failure to deliver interactive
online services. It reported that only seven services, just 3%,
were truly interactive, providing grants or benefits online, while
none collect payments.
Auditor general Sir John Bourne said: "The major challenge is to
get services online and to encourage and enable people to use them.
Otherwise the considerable potential gains in departments'
efficiency will not be delivered and large amounts of public money
will have been wasted."
However, Chas Roy-Chowdhory, head of taxation at the Association of
Chartered Certified Accountants, said the failure to deliver a
secure online tax filing system cast doubt on the wider
e-government strategy.
"If the Inland Revenue has problems when a small percentage of
people file electronically, I seriously doubt its ability to handle
anything bigger."
He added that if the pioneer of e-government has had such problems,
it must call into doubt the ability of other government
departments, with less experience than the Inland Revenue, to
deliver effective, secure online services.
The Inland Revenue last month launched a competition to select a
new technology partner from 2004 when its contract with EDS runs
out.