Labour MP Catherine McKinnell speaks to parliament on behalf of Concentrix tax cut victims

Labour MP Catherine McKinnell has called for the government to rectify the “shambles” of tax credit claimants who had their payments stopped without fair notice.

Concentrix, a firm hired by HMRC has been accused of incorrectly withdrawing tax credits from claimants. The US firm was employed by the government to reduce tax credit fraud and overpayment.

In a statement last month, HMRC’s chief executive Jon Thompson said: “We have decided not to extend our contract with Concentrix.” The firm’s contract with HMRC has not been renewed but the company will continue to operate until May 2017. Critics claim thousands of households have had their tax credits cut with false information.

Ms McKinnell, MP for Newcastle North, said: “Many of my constituents have been left in utter financial disarray by having been left for a time with no income.”

“Ultimately, it is the children in those households who suffer.”

Tax credits, which include Child Tax Credit and the Working Tax Credit, are payments made by the government to households on low incomes. Claimants could have been targeted for tax credit checks if they had bills listed in joint names, an adult child still living at home or, not updating the Electoral roll records when changes occurred in the household.

Ms McKinnell told parliament: “One constituent who came to me looks after two children and works 16 hours a week, and he received no money for six weeks.”

Thousands of people whose tax credits were wrongly suspended may be able to claim backdated payments. HMRC allocated 150 staff last month to help those who may have been affected and seeking to appeal Concentrix’s decision. Claimants who had split from their partner, or their partner had passed away had their tax credits cut by the firm.

McKinnell added: “Some of the people they were accused of living with were not alive”.

Claimants who believe their tax credits were incorrectly cancelled can call the HMRC’s Tax Credits Office on 0345 300 3900 for more assistance.

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