THE revelation that HMRC had to pay nearly £87,000 in compensation payments to claimants wrongly denied benefits by contractor Concentrix serves as a warning not to believe private-sector superiority myths.

New Labour, Tories and Liberal Democrats have all worshipped at the shrine to private-sector efficiency, believing that the profit motive guarantees savings to benefit taxpayers.

HMRC staff are totally capable of dealing with issues related to tax credits and of rooting out fraudulent claims — or at least they would be if their numbers weren’t under constant threat of being slashed.

Concentrix is no fly-by-night dodgy outfit. It is the subsidiary of a massive California-based transnational corporation with over 90,000 employees elsewhere, specialising in corporate services.

But its prime motivation is delivering profits for its parent company not dealing sensitively with financially vulnerable claimants.

HMRC handed Concentrix a £75 million contract in 2014 to reduce fraud and error in the tax credit system in the expectation that it would shake out savings of £1 billion.

The company’s modus operandi was the capitalist classic of working class divide-and-rule to further enrich the already minted.

Concentrix caseworkers were young, inexperienced, underpaid at below HMRC rates and overworked, with just 300 compliance officers to deal with 100,000 cases.

They would concentrate on queries relating to working hours, childcare and undeclared partners and were expected to shut down an average of 25 cases a day, meaning that claimants could be written off for a variety of “failings.”

These included affecting to believe that people registered in the past at a claimant’s address were their undisclosed partner.

Credit checks carried out by caseworkers would also throw up closed joint bank accounts that served as a reason to doubt a claimant’s single status.

Similarly, tenancy agreements, utility bills and council tax accounts that had not undergone a name change were used as justification by harassed caseworkers obsessed with hitting their 25 write-off target to disallow a claim, stop payments and send tens of thousands of people into the depths of despair.

According to the National Audit Office spending watchdog, Concentrix reduced or ended 108,000 tax credit claims in just two years from November 2014.

Yes, almost a third of these ropey decisions were overturned after a mandatory reconsideration, but that doesn’t compensate for the harrowing time spent by claimants penniless and hopeless.

MPs from the Commons public accounts committee have decided to drag senior Concentrix and HMRC figures before them next week to explain themselves.

No doubt it will afford an entertaining Roman holiday bloodsport diversion, but it should also make MPs themselves pause to examine their own responsibilities.

How many have previously demanded that public services emulate “private-sector managerial skills and efficiency” or acquiesced to ministerial insistence that the public sector be subject to private business’s supposedly superior practices?

How many have railed at the relatively small sums lost through mistakes or fraud in the areas of benefits and tax credits while turning a blind eye to the much larger losses through illegal tax dodging by companies and wealthy individuals?

It’s welcome that Concentrix staff members are being transferred to HMRC employment following the tax-credit contract’s return in-house.

They should receive the same pay and conditions as existing HMRC staff and will, all being well, enjoy a qualitatively superior work experience in the public sector with the PCS union to represent them.

The next time that right-wing ideologues of any party eulogise private-sector efficiency, they should be reminded of Concentrix and HMRC.

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