Government to make public services online only

Businesses will be forced to complete some tax forms online, the government has revealed in plans to scrap paper applications for tax reporting, student loans and other services.

The majority of applications for public services will be moved online by 2013, with the aim of saving £112.5m, Cabinet Office minister Francis Maude said in a speech on Tuesday.

"We want to become a government which is digital by default, making online the preferred channel for government services," said Maude.

Maude's speech in London was made in response to a report by Martha Lane Fox, the government's 'digital champion', who on Monday proposed the shift to online forms.

HM Revenue and Customs (HMRC) is working to get tax functions online, Maude added. From 2013, businesses will have to notify HMRC via the internet that they have begun operations so they can be registered for self-assessment and corporation tax. Within the same timeframe, employers will move to put Pay As You Earn (PAYE) scheme numbers online.

From August 2012, companies will have to register for VAT online, as other registration channels will be closed or consolidated. Companies will also be able to make changes to their VAT status online, including deregistration and alteration of VAT details.

The plan to shift to digital tax forms comes despite the HMRC's poor record on making IT initiatives work. In September, an employee at the tax department described its IT systems as "atrocious".

The plans extend to Companies House, which will introduce digital-only filing, including incorporation, accounts and annual returns. However, the government has to conduct an impact assessment and get secondary legislation passed before this shift — which is expected to save £2m a year — can go ahead.

In addition, the Department for Work and Pensions (DWP) aims to get 80 percent of applications for jobseekers' benefits online by 2013. The initiative will feed into the government's Universal Credit scheme, which will be predominantly digital access only, although telephone applications will not be closed down.

Universal Credit is the government's plan to amalgamate a number of different existing benefits under one banner. Working Tax Credit, Child Tax Credit, Housing Benefit, Income Support, income-based Jobseeker's Allowance, and Employment and Support Allowance are among the benefits to be amalgamated.

The DWP will automate its support services, and it expects to spend £100m less on administering Jobseeker's Allowance by 2014/15.

Student loans applications will go completely digital. Paper forms will no longer be printed or be available to download from Directgov, said Maude. The Student Loans Company will support people who are unable apply online, he added.

In August, the Office for National Statistics said that 27 percent of British households did not have an internet connection, and that the majority of those aged 65 and over had never been online. However, Maude said that the government's plans will not lead to hardship for these people.

"There have been concerns raised that this shift to 'digital by default' will disenfranchise citizens from services," Maude said. "I cannot state emphatically enough that this is not the case. This does not mean that if you can't access the internet, you can't access the services. We will leave no one behind."

In his speech, Maude announced that the Department for Business, Innovation and Skills will provide UK online centres to help people get started using the internet, with funding of £13m over the next two years. In addition, the Post Office will start a test scheme to help people access digital services.

Age UK, the UK's largest charity for older people, said in a statement on Tuesday that the government needed to continue to offer offline services to be inclusive.

"Some people will always have difficulties getting online, which is why it is important that vital products and services remain offline," Michelle Mitchell, charity director at Age UK, said. "With six million people aged 65 and over having never used the internet, Age UK welcomes the government's commitment to make sure all government services are available to everyone, whether they are online or not."