Payday loans and the missed opportunity?

Jerry Fishenden – ntouk

Don’t be misled by the title, this isn’t really a post about payday loans. Instead, it explores the fascinating contrast between the approaches HMRC (for tax) and DWP (for benefits) have taken to opening their services to third parties. The basic story is pretty simple: HMRC has a long pre-internet history of working with third party intermediaries which it carried forward into its thinking abuot online services (at one stage their ambition was not directly to offer an online tax return service at all); DWP’s history is much more about direct delivery, and that tradition similarly has been carried forward into the online world. The post makes no pretence to neutrality on the central question of which was the better choice, HMRC is clearly seen to have won that argument hands down.

The post is good on the advantages of the open method and the opportunities that could create (including the ethical payday loans of the title). But it doesn’t address the fairly central question of whether there is a reason for the difference. After all, HMRC’s administration of tax credits, which are a benefit in everything but name, didn’t get the same open treatment as their revenue-raising lines of business. The question of whether a version of HMRC’s trust model for taxpayers and their agents could be translated to the benefits system is one well worth further reflection.

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