HMRC has come in for strong criticism over high costs and low service levels in the latest Public Accounts Committee (PAC) report on charges for customer telephone lines for government departments.

The report says that in 2012-13 central government handled at least 208m telephone calls, with the Department for Work and Pensions (DWP) accounting for 100m and HMRC receiving 68m calls. Some 63% of the total calls to central government were to higher rate telephone numbers, costing callers some £56m.

PAC's analysis found customer service levels across government departments to be 'unacceptable', with long waits for calls to be answered. It describes HMRC's performance as 'considerably worse' than that of DWP, which has managed to cut the average time spent waiting from four minutes 12 seconds in 2012-13 to one minute 44 seconds in Q1 2013-14. In contrast, HMRC's average waiting time in Q1 2013-14 is put at seven minutes.

PAC chair Margaret Hodge said of HMRC's performance: 'Astonishingly, the department only managed to answer 16% of the calls it received to its Tax Credits helpline on 31 July 2013, the deadline-day for notifying changes of circumstances.'

The committee is calling on the Cabinet Office to establish the principle that public service performance is always measured against industry standards of customer service, which would mean setting a target of answering 80% of calls in 20 seconds. It wants departments to publish on an annual basis their performance against industry standards and where there are shortfalls set out what steps they are taking to improve service levels.

PAC also claimed that government departments' arrangements with telephone service suppliers lack the transparency needed to demonstrate whether value for money is being achieved. The committee said departments do not know how much money the telephone suppliers make from using higher rate lines, and fewer than half of telephone lines have the data needed to assess telephone line performance.