RTI: Inside the massive IT project at the heart of universal credit
RTI: Inside the massive IT project at the heart of universal credit
The complexity of Revenue and Customs' Real Time Information programme is in the implementation rather than the technology, writes Mark Say
Real Time Information (RTI) is tied up with one of those big reputational issues for the government. It's about making the operations of HM Revenue & Customs more efficient, but it will also be crucial in the implementation of universal credit, the Department for Work and Pensions (DWP) programme at the heart of the government's welfare reform policy.
RTI will involve employers and pension providers telling HMRC about tax, national insurance contributions and other deductions at the time, or before, payments are made, instead of waiting until the end of the tax year. The move is intended to help DWP provide claimants with universal credit without demanding information on their incomes, and with more confidence that it is getting the payments right.
It is a big, highly complex project, but according Mark Holden, the RTI programme director at HMRC, it is on schedule for full delivery by October of 2013. A handful of employers are due to take part in a pilot beginning in April of this year , with the numbers rising to 300, then more than 1,000, then hundreds of thousands by April 2013.
"All the IT is tracking, we're in final phases of testing, and it's looking very good," Holden says.
While he anticipates some big challenges, he believes they're unlikely to be around the technology. "Probably it's more around the implementation. Although this is very big IT, it's not bleeding edge technology. The biggest change is around any changes the employers have to make, so the real thing for us is making sure the communications are clear, making sure the guidance we are publishing is in plain English and the employers understand it first time around.
"That's why we're really pleased to be able to run a pilot, which is not a luxury we've had many times before."
There will be "a lot of hand holding", according to Holden, who would rather identify and correct glitches at this stage than after the go live.
Employers and software makers prepare
There are two major constituencies to deal with in implementing the programme the employers who will provide the information and the developers of PAYE software. Holden says that awareness among the former group is mainly limited to larger organisations at the moment, but that HMRC is now focused on spreading it to SMEs and micro-employers, with a communications strategy planned to ensure they are all ready to take part next year.
The 400 or so PAYE system providers are all onboard already. "We have an ongoing relationship with them, so we have a very established mechanism for working with them and their trade bodies," Holden says. "For the 18 months we've been preparing to bring this in we've been working through the specs, working on any glitches that they see, and making sure we're designing the system with their input.
"This is very much a collaborative project rather than us just putting out the spec and saying 'Good luck guys', and I'm very pleased that we've had massive engagement throughout, and have their representatives on our programme board."
How much work is need to make PAYE software compatible with RTI? According to Holden, it is hard to give a definitive answer given the vast number of products concerned, but it is not cutting edge technology, and amounts to an evolution than a revolution of suppliers' systems, he says. "It is incremental for them, but I don't want to underplay the amount of work involved," he says.
Internally, most of the programme is built on platforms already used by HMRC. In most cases, such as the department's SAP platform, it requires an enhancement rather than a radical change, and the biggest challenge is in the massive number of interfaces that have to be tested and have to work before going live.
The Aspire consortium, the largest IT supplier to HMRC , has been undertaking most of the relevant technology work under the direction of the in-house project team. While the consortium is bringing all the pieces together, some SMEs are also involved in the project, including one which is developing a PAYE tool that will allow employers without commercial software to file information.
Working with the DWP
The DWP also has a role to play in the programme. The two departments have a history of sharing information, with more than 60,000 DWP users transacting with HMRC systems about 200,000 times a day, and about 5,000 HMRC staff transacting with DWP systems, and both source large amounts of data from the other, in areas such as income tax, national insurance, child benefit and tax credits.
Holden says the programme is building on what they have already done together, and that both have representatives in their programme teams for RTI and universal credits.
"Although we're really clear in governance terms that [RTI is] an HMRC programme, if you looked across the piece you would be hard pressed to split the two programmes apart," he says. "The feedback we're getting from DWP and all the external reviews is that it's an exemplar in terms of working with them."
While senior officials at HMRC are confident that they will deliver RTI on schedule, they are being cautious over one big feature: one element of the programme involves moving away from reporting through the Electronic Data Interchange and Government Gateway to using Bacs, the banks' channel for transferring payments.
The software and banking industries have expressed concerns over the timetable for the change, and HMRC has stood back from setting a target date.
"One of the reasons we want to make sure everyone is ready for that is that in moving to Bacs as a filing channel we need to work very closely with the banking industry and it is technically their channel, and any changes we make have to be tested with all of the banks on board," Holden says.
"At the moment we've got two tried and tested channels, Electronic Data Interchange and the Government Gateway, both of which are high volume, and all of the software industry is used to working with them. That's what we'll go live with.
"If and when we decide to move to a different channel we'll give the industry plenty of notice to enable them to make those changes to their products."
Underlying all this he makes a point that is often heard, but sometimes lost, in the progress of such big programmes. RTI involves a lot of work on technology, but it essentially a business programme. The first test of its success will come after October 2013, when all can see whether HMRC's business with employers has changed in the way it is intended. The second will come when universal credit fully kicks in, and we see whether the government has pulled it off on that reputational issue.