Rushed testing led to tax credit IT system failures

Failures in the IT systems behind the government's new tax credits were in part caused by a "compressed testing timetable",...

Failures in the IT systems behind the government's new tax credits were in part caused by a "compressed testing timetable", according to a report on the Inland Revenue's accounts by auditor general John Bourn released last week.

The report revealed that the Inland Revenue could have lost up to £2bn in overpaid tax credits. It highlighted delays with new IT systems that should have helped rectify the problem.

The tax credit project was dubbed "an exemplar of good programme management" and given a "green light" in the Office of Government Commerce Gateway 4 Review. The review approved the system's readiness for service, despite saying it was a "high-risk project" and being informed of the compressed testing deadlines.

Treasury minister Dawn Primarolo told a House of Commons select committee, "The review team make no recommendations classified as red or amber. The programme team are well aware of the risks and issues they face. They have a tight grip on them and have comprehensive plans in place to manage them."

OGC chief executive Peter Gershon stood by the review's findings at a Treasury select committee meeting on 10 September, even though the systems had failed to work effectively when they went live in April.

He said, "When the system went live it clearly exhibited very serious difficulties and we are working with the Revenue to understand whether they were fundamental design flaws, whether the fact that the system was tested to 50% of the anticipated volumes meant there was something which then occurred between that 50% and the volumes we experienced in practice that caused it to exhibit problems."

Despite noting the compressed testing times, the auditor general's report simply said, "The nature of the testing regime meant the underlying technical faults could not have been discovered and corrected in testing, although more testing might have reduced the effects of the problem."

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