Revenue and Customs is to close more than 200 offices and axe thousands more jobs as part of cost-cutting plans, union leaders said today.
Managers in the department briefed staff about the future shape and direction of the organisation, refusing to say how many sites or jobs will be affected.
But the Public and Commercial Services union said it believed more than 200 of the department's offices across the UK - around a third of the total - will close and thousands more jobs will be axed.
Revenue and Customs (HMRC) is already more than halfway through a programme to cut 12,500 jobs by 2008 and there are fears in the union that a further 12,500 could now be axed.
Paul Gray, acting chairman of HMRC, said last year's merger between the Customs and Inland Revenue departments had provided opportunities to meet Government targets of reducing staff by 12,500 and cutting costs by £30 million by 2008.
"The department now has more buildings than it needs, and co-locating staff makes good business sense whilst providing the opportunity to streamline processes and eliminate duplication."
The union said today's meeting had signalled "sweeping" office closures and job cuts and officials warned that the move added to pressure for a national strike ballot among all civil servants over jobs, services and pay.
The PCS claimed there was now a backlog of a million items of post in the HMRC, including self assessment tax returns, tax codes, tax credit repayments and P45s and warned that further job cuts would damage services even more and undermine the Government's ability to collect revenue.
The department would not be "fit for purpose" in two years' time if the cuts continued, general secretary Mark Serwotka warned.
He added: "It is foolhardy in the extreme to think that cutting more jobs and closing more offices will improve service levels in HMRC.
"With a backlog of a million items of post already stacking up as the department slash 12,500 jobs, further cuts will damage service levels and undermine the ability of the Exchequer to collect revenue, leaving HMRC unfit for purpose.
"We are growing increasingly fearful that as other departments also seek to cut their budgets by 15% over the same period, that more job cuts will follow elsewhere.
"Time is running out for the Government, who need to wake up to the fact that cuts mean deteriorating service levels and who need to realise that decent public services need people to deliver them."
HMRC denied it was announcing any office closures or further job losses today, adding that consultations with unions will continue on how to deliver a more effective service.
Mr Gray said: "Today's announcement sets out the modernisation and transformation that HMRC wants to undertake over the next five years to put our taxpayers, claimants and other customers at the heart of everything we do, thereby improving efficiency and effectiveness.
"The creation of HMRC, where Customs and Excise and the Inland Revenue were integrated, means the new organisation now has more space than it needs.
"We are taking the opportunity to save taxpayers' money by operating with fewer buildings in a more co-ordinated cost efficient way.
"We are inviting all staff to comment on our proposals and to fully participate in our programme of change."
The department's workforce of around 100,000 has already been cut by 7,500 as part of the 12,500 reduction.Reuse content