Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what steps her Department is taking to ensure that HMRC’s fraud detection systems do not incorrectly suspend child benefit payments for claimants that travel through the Republic of Ireland.

Child Benefit is paid to over 6.9 million families, supporting 11.9 million children. It is one of the most widely accessed benefits in the UK.

As part of its ongoing efforts to reduce error and fraud in the Child Benefit system, HMRC undertook a pilot last year using international travel data. This pilot saw thousands of people who had left the UK but carried on claiming Child Benefit removed from the system - preventing around £17m in wrongful payments. This led to a wider rollout and investment in an additional 180 counter-fraud staff, announced at the Autumn Budget 2024 and is expected to save £350 million over the next five years.

In expanding the process last month, a check of HMRC systems to first look for continuing UK employment was inadvertently omitted on around 23,500 enquiries. While evidence from the pilot suggests that most of these cases will have been correctly suspended, the omission of the check has meant that HMRC will have incorrectly suspended payments in some instances.

HMRC has taken immediate corrective action to resolve this issue. The employment check has been reinstated for all future cases meaning fewer people will be sent letters in the first instance. In addition, HMRC has retrospectively applied this check to the 346 Northern Ireland customers, resulting in reinstated payments for 134 cases. HMRC have also reinstated payments for a further 46 Northern Ireland customers while we clarify their residency status.

HMRC has taken steps to improve the process. HMRC will no longer suspend payments at the outset and will give customers time to evidence their entitlement first. Together these changes will reduce error and ensure fair treatment of claimants.

Customers affected by the issue who believe they are still eligible should call the number on the letter they received. HMRC have set up a dedicated team to handle their cases swiftly.

Where eligibility is confirmed, payments will resume and HMRC will make backdated payments, so no-one is left out of pocket.