US firm takes over tax records

A pounds 1bn CONTRACT giving day-to-day control of British citizens' personal tax records to a United States company is expected to be signed today.

This is Whitehall's biggest computer privatisation under the Government's 'market testing' programme which allows private companies to bid for public-sector work.

Michael Meacher, Labour spokesman on the Citizen's Charter, is to demand a full breakdown of the savings to the Treasury from the deal in a series of parliamentary questions he is tabling today.

An announcement confirming the deal between the Inland Revenue and the computer company EDS is expected early this week, possibly later today. The Revenue spokeswoman would say only that it was 'possible' the announcement would include details of expected savings.

Mr Meacher said that computing at the Revenue was already very efficient, and the only obvious route to substantial savings was through large-scale redundancies. However, the Revenue's spokeswoman said yesterday that there was 'no question of redundancies'. The majority of the 2,000 staff involved would become EDS employees; a few hundred would remain with the Revenue to run tax records for the Queen and other public figures such as MPs and judges.

Clive Brooke, general secretary of the Inland Revenue Staff Federation, said that while the union was happy with staff contracts finalised with EDS last week, 'that does not inhibit me from raising oher broader issues of public concern, including the lack of transparency over the terms of this deal.'

Operations are due to be handed over to EDS on 1 July, a report in Computer Weekly said earlier this month.

Mr Meacher said confidentiality of personal tax records could not be maintained out of the public sector.

The Revenue said ultimate responsibility for confidentiality would remain with its board and EDS would process all confidential information in the United Kingdom.