4.1 The ATO's services to tax practitioners provide the latter with access to important information and electronic processes for fulfilling their clients' tax obligations. Key services in this regard include the ATO Portals which allow tax practitioners to access client tax information as well as communicate and complete a range of transactions electronically with the ATO.179 For example, tax practitioners use the ATO Portals to amend certain returns, manage client information, generate ATO reports as well as lodge deferrals, objections and private rulings.

4.2 Another key service is the ELS which facilitates the electronic lodging of ATO forms via a software interface platform.

4.3 The ATO also maintains a website which provides general and specialist services to tax practitioners through direct access to ATO forms, tax technical information and various tools. A range of telephony services are also provided to tax practitioners. Appendix 2 sets out a detailed list of the various ATO services that are provided.

4.4 The above services are fundamental to tax practitioners' day-to-day business. As stated in Chapter 1, the vast majority of taxpayers use tax practitioners to assist them to comply with the tax laws.180 Therefore the quality and efficiency with which these services are provided also have a significant bearing on the effective functioning of the tax system as a whole including minimising the overall delivery costs for the ATO.

4.5 As discussed in Chapter 2, some of the ATO's tax practitioner services have at various times failed to meet expectations, resulting in frustration and tension with the ATO. The ATO has taken action to address irritants and improve its services. However, concerns with the quality of ATO services have persisted.

4.6 This chapter examines the key ATO tax practitioner services, associated stakeholder concerns and potential improvements.

ATO Portals and migration of their functionality

4.7 The ATO Portals are a secure online gateway to various internal systems that the ATO uses to administer the tax system.181

4.8 The Tax Agent Portal and the BAS Agent Portal operate on the same ATO infrastructure but have different sets of functions and interfaces to cater for the different roles of tax and BAS agents.

Stakeholder concerns

4.9 For most tax practitioners, the ATO Portals are 'the most useful tools that the ATO has ever provided' and is essential to their business—'tools which they cannot do without'. However, a common complaint raised by tax practitioners was their unreliability. In particular, during busy periods, they can be unstable, unresponsive, slow or just not available for significant periods of time. Such unreliability has resulted in productivity loss, missed deadlines, irrecoverable costs as well as damage to their reputation and relationships with clients. This has led some tax practitioners to refer to the ATO Portals as the 'pot hole'.

4.10 Some tax practitioners also believe that information on the ATO Portals is not always accurate or up to date and they suffer further productivity loss in seeking to make corrections. Examples of inaccurate information on the ATO Portals include:

  • the due dates on the Tax Agent Portal being different to those on their income tax return lodgment report;
  • the ATO Portals showing clients' returns as 'not lodged' where the previous returns were marked as 'final';
  • a requirement for newly registered entities to lodge returns in years when they did not exist; and
  • clients appearing in tax practitioners' lists when they had previously been deleted.

4.11 Furthermore, stakeholders also noted that ATO officers lacked an understanding of the ATO Portals' operation and were ill-equipped to assist or provide advice when tax practitioners experience difficulties with the ATO Portals.

4.12 Concerns have also been raised with the impending migration of the ATO Portals' functionality onto a new software platform. Given previous experience with the ATO's deployment of new technology, such as the Change Program,182 many queried the adequacy of the ATO's preparedness to mitigate potential risks for tax practitioners. Many tax practitioners also questioned whether the same level of functionality provided in existing ATO services will be available on the new platform.

4.13 Each of the above concerns is discussed in the following sections.

Reliability of the ATO Portals

4.14 Some of the causes of unreliability of the ATO Portals are outside of the ATO's control. Such causes include browser incompatibility or AUSkey-related issues.183

4.15 Furthermore, some of the unreliability experienced by tax practitioners is attributable to the various ATO internal systems which are accessed through the ATO Portals rather than the ATO Portals themselves. These internal systems require maintenance which results in certain functionality not being available when necessary maintenance is being carried out.184

4.16 Where the reliability of the ATO Portals is within the control of the ATO, the ATO has established an internal performance standard.185 These include a three-second response time in 95 per cent of both business and non-business hours.186 Daily reporting on the ATO Portals' performance is provided internally to the chair of the ATO's LWG187, but is not published.

4.17 The graph below depicts the ATO Portals' average daily response times, for all transactions that are monitored, 188 from 1 June 2014 to 1 October 2014.189

Figure 1: Average daily response time across all monitored pages

Figure 1: Average daily response time across all monitored pages

Source: ATO.

4.18 The above graph shows that there were four days over the four month period

(June – September 2014, inclusive) in which the ATO Portal response times averaged more than 3 seconds. These days occurred close to lodgment deadlines for fringe benefits tax as well as monthly and quarterly activity statements or because of system issues. In September 2014, however, slower response times were not experienced close to the deadlines for monthly activity statement lodgment or the PAYG withholding and payment summary.

4.19 However, the above data is an average of response times over the day and may not reflect the user experience for specific transactions:

Within a day you might have periods of difficult access, followed by periods of relatively rapid access. Overall, it meets the three-second standard.190

4.20 Accordingly, the ATO intends to respond quickly when problems arise and service standards are not met:

We keep our ears finely tuned to the feedback from tax agents. We understand that this is fundamentally how they do their business. Whilst we have not met that service standard at all times, certainly I want to make it clear to my people that we listen very, very carefully and respond quickly when there are problems. We acknowledge there has been some issues, that's for sure.191

4.21 The ATO Portals may also be unavailable while the ATO conducts routine maintenance. The ATO has acknowledged that the ATO Portals' maintenance schedules may no longer support tax practitioners' evolving business models,192 especially for those tax practices operating on Saturday and Sunday.

4.22 Planned maintenance has been limited to once a month on a Saturday from 9:00pm to Sunday 9:00am—a total of 12 hours per month.193 The ATO also aims to reduce this period further to a 9 hour window overnight:

We minimise actual outages as much as we possibly can, although with a system with many, many parts—60,000 interfaces—there is a lot of maintenance work that has to be done. Occasionally on weekends, we will have to bring the ATO Portals and the mainframe systems down. When we do that, we try to limit that to say 9 pm to 6 or 7 am in the morning.194

4.23 Notwithstanding this aim, the ATO has scheduled longer periods for maintenance. For example, the ATO Portals were unavailable for 56 hours from 11:00pm

Friday 7 November until 7:00am Monday 10 November 2014.195

4.24 Furthermore, where possible, the ATO aims to provide advance warning of service disruptions and the potential need to take mitigating action by:

  • sending SMS alerts which advise on significant unplanned outages, functionality issues and service restoration;
  • updating the ATO Portals' homepages to identify problems and any proposed workarounds while restoration work is undertaken; and
  • providing inbound telephone support messages on any current issues.196

4.25 A list of known system issues affecting access to or use of the ATO Portals to alert tax practitioners is also published on the ATO website. This list includes a description of the issue, the status of their resolution and possible workarounds.197

4.26 It should be noted that the reliability of the ATO Portals may impact other ATO services. For example, issues with the ATO Portals' performance may result in an increase in tax practitioner telephone calls to the ATO, as was experienced during

1-2 October 2014 when such calls amounted to approximately 12 per cent of all tax practitioners' calls to the ATO.198

4.27 The ATO expects that concerns with the reliability and performance of the ATO Portals199 will be more comprehensively addressed when migration to a 'more functional software platform and flexible online system' occurs in the near future.200

4.28 It has been observed that this migration should not prevent the ATO from addressing current service disruption and speed issues with the ATO Portals.201 Accordingly, the ATO has stated that it intends to 'maintain the [ATO Portals] as best [it] can in their current state'.202 In fact, it released a new version of the ATO Portals in March 2015 which was intended to deliver:

  • increased availability, stability and performance, resulting in an improved experience for users;
  • [capability to] enable changes to be delivered in a more flexible manner with minimal outage, and
  • an improved platform to provide services as we work to implement the

    end-state.203

Accuracy of information on the ATO Portals

4.29 The ATO Portals are a gateway to information held in a number of other ATO systems204 such as the Integrated Core Processing (ICP) system which processes all ATO registrations, forms, payments and accounting transactions.

4.30 Inaccuracies with information on other systems, therefore, may be reproduced on the ATO Portals. Inconsistencies between systems may also arise when system updates are completed in staggered batches over time rather than in real-time.205

4.31 The ATO has identified the following inaccuracies and inconsistencies appearing on the ATO Portals:

  • incorrect status of 'not lodged' for a subsidiary member of a consolidated group — such subsidiaries are not required to lodge;
  • incorrect status of 'not lodged' for some income tax years when a Further Return Not Necessary (FRNN) status applies for multiple years;
  • incorrect status of 'not lodged' for recently registered clients; and
  • incorrect year of commencement for FRNN indicators.206

4.32 The ATO advises that each of the above issues is currently under investigation. However, it has not advised when such issues are expected to be resolved.

ATO Portals training for ATO officers

4.33 The ATO aims to improve ATO officer awareness and understanding of the ATO Portals through a self-directed 'foundation' training course.207 Call centre officers are also provided with access to basic information on the ATO Portals and its functions208 as well as a list of known issues with the ICP system and any remedial action that may be taken.209 ATO officer training on subject matter other than the ATO Portals is discussed later in this chapter.

4.34 Since January 2014, the ATO has also provided its call centre officers with access to the ATO Portals to support them in assisting tax practitioners to navigate the systems. Prior to this change, such assistance was provided without such access.210

Migration of ATO Portals' functionality

4.35 As stated earlier, the ATO has plans to progressively migrate 'priority Portal services' (or functions) into 'a more robust platform for online services', namely ATO Online.211 The ATO has advised that ATO Online is intended to provide the user with a holistic, integrated and seamless experience in accessing relevant taxation information and transacting with the ATO.212 Appendix 7 illustrates the planned transition of the ATO Portals to ATO Online and other software.

4.36 Although no date has been set for the migration of the ATO Portals' functionality to ATO Online, the ATO intends to operate each system concurrently until the ATO Portals are decommissioned following consultation with the tax profession.213

4.37 To gain a better understanding of tax practitioners' views of the ATO Portals functions, the ATO surveyed practitioners and conducted face-to-face workshops in September 2014. Over 3,000 tax practitioners took part in the survey and 16 took part in the workshops.214They identified pre-filling reports, account balances and adding or deleting clients as the most important functions of the Tax Agent Portal and lodging activity statements as the key function of the BAS Agent Portal.215

4.38 Participants also identified the following 'critical' services to migrate first to the ATO Online platform:

  • Prefilling
  • Viewing activity statements
  • Regenerate BAS
  • Add client/update details
  • Viewing other accounts (more description on transfers into the ICA)
  • Self-help deferrals
  • Other correspondence
  • Super Guarantee – generate amounts and calculate interest
  • Lodging IAS.216

4.39 Furthermore, participants identified the following 'wish list' functions:

  • compatibility with certain software and hardware products, such as tablets;
  • visibility of how lodgments are progressing; and
  • real-time alerts.217

IGT observations

4.40 The ATO Portals provide a suite of functions218 which have become fundamental to the operation of many tax practices. As mentioned previously, tax practitioner satisfaction with the ATO's services in 2002 was at a low and it could be said that the ATO Portals' implementation was a key factor in subsequent improvement in tax practitioners' satisfaction.

4.41 Since 2002, however, expectations of service delivery have been raised due partly to improvements in communication and technology. What was seen as efficient 10 years ago may now be seen as slow and obsolete.

Reliability of the ATO Portals

4.42 For tax practitioners, the ATO Portals allow them to perform many day-to-day activities more efficiently than through other service channels. Where the performance of the ATO Portals becomes unreliable, however, tax practitioners may be forced to engage with the ATO by telephone or letter. For many day-to-day activities, such methods of communication are less efficient and impose additional costs on the ATO and tax practitioners alike.

4.43 The ATO has announced that it aims to migrate the most important functions of the ATO Portals to a more robust platform for online service and other software in the future. The realisation of this aim may address many of the stakeholders' concerns relating to the performance and reliability of the ATO Portals.

4.44 Given the limited future of the ATO Portals, enhancements may not be practical. However, the IGT is of the view that as the work of tax practitioners, and to some extent the efficient administration of the tax system, is dependent on the ATO Portals, the ATO should ensure that they are operating effectively with minimal service disruption.

4.45 As stated earlier, the ATO has implemented a number of strategies which aim to reduce the number and impact of these disruptions. One of these is monitoring the response time on a daily basis and understanding performance issues. As previously mentioned, one of the earlier reports had indicated that slow performance issues were closely related to systems issues and user load occurring near lodgment deadlines. In addition to uncovering such matters, monitoring also provides a basis to seek improvements and assess the effectiveness of such improvements. For example, the response times experienced close to the September 2014 deadline for lodging monthly activity statements was significantly quicker than for the preceding activity statement deadlines.

4.46 Unfortunately, the performance reports of the ATO Portals are not publicly available, leading to perceptions of poor performance remaining unchallenged if verifiable data exists to indicate the contrary. If these reports were publically available, tax practitioners and the ATO would have a shared understanding of the challenges and could work collaboratively to resolve significant issues. Accordingly, the IGT is of the view that the above performance reports should be made publicly available on a regular basis.

4.47 In relation to ATO Portals being down due to maintenance work, the ATO is seeking to limit the time taken for such work and is aiming to schedule them during periods of low usage. It is expected, however, that occasionally more time may be required. The ATO aims to mitigate any adverse impacts on tax practitioners by alerting them via direct communication and on the ATO website. The ATO also provides a list of known issues on its website together with a description of the issues and any workarounds for tax practitioners.

4.48 Information which allows users to self-diagnose their issues and reduce the need to contact the ATO phone service for assistance is beneficial. However, whilst the list of known issues on the ATO's website may alert tax practitioners to the existence of performance issues, no explanation or timeframes for their resolution is provided. By providing this additional information, the ATO could better manage tax practitioner expectations and maintain their confidence in the system. Such information could be provided in the central register proposed in Recommendation 3.1 of this report.

4.49 The IGT also believes that the ATO should remain alert to tax practitioners' concerns with the ATO Portals until they are decommissioned by maintaining continued dialogue on the topic through the ATO's 'tax professionals community' online forum amongst others. Confidence in the ATO's responsiveness in this respect would be promoted by capturing the issues raised transparently on the central register recommended above.

Accuracy of information on the ATO Portals

4.50 As mentioned earlier, inaccurate, incomplete or out-of-date information on ATO systems may be reproduced on the ATO Portals or may arise from the staggered approach to updating systems. Therefore, corrective action may involve a number of ATO systems requiring considerable ATO resources. However, such information may require tax practitioners to incur substantial time and unrecoverable costs in engaging with the ATO to rectify the causes and ensure consistency of information.

4.51 The list of known issues on the ATO website, referred to above, contains instances of inaccurate information to the extent that the ATO is aware of them. The IGT supports this approach. However, many of these issues are reported to have an 'under investigation' status which does not provide an indication for when such issues will be rectified. These issues need to be addressed expeditiously and, as mentioned above, an expected completion time should also be provided.

ATO Portals training for ATO officers

4.52 As mentioned earlier, ATO call centre officers receive foundation level training and access to basic information on ATO Portal functions. However, they were only recently provided with access to the ATO Portals. The IGT believes that, through such access, their working knowledge of the systems should improve over time. The IGT is also of the view that their working knowledge could be enhanced by providing a practical user guide. Publication of this guide would also provide a valuable reference tool for tax practitioners.219

4.53 The ATO also supports its call centre operators in assisting tax practitioners by maintaining a list of ICP system issues together with remedies. However, ATO Portal issues which are not related to the ICP system are not captured in a similar way. The IGT considers that expanding the existing list to capture all ATO Portal issues would improve the support to such staff and consequently their ability to better assist tax practitioners.

Migration of ATO Portals to ATO Online

4.54 The Tax Agent Portal was positively received when it was first introduced in 2002. However, these systems have remained largely unchanged since they were first introduced.

4.55 The ATO has acknowledged that there has been 'trouble maintaining the infrastructure to a state or degree that is satisfactory from the tax agent's point of view'.220 In the light of the rapid changes in technology and electronic service delivery expectations over the last 13 years, the ATO Portals are in need of upgrade. Accordingly, the ATO has advised that the ATO Portals will be migrated to a 'more functional software platform and flexible online system.'221

4.56 The IGT supports this migration, particularly where it is expected to improve reliability and performance. However, it is noted that no timeframe for the completion of this migration has been provided. This is a key question, as if full migration is quite some time away, it may be necessary to not only maintain the ATO Portals with minimal disruption but to also improve them.

4.57 Transitions of information technology systems pose significant risk of disruption to services. The IGT has previously observed the difficulties with such transitions during the Change Program and resulting impacts on tax practitioners' businesses and client relationships.222 A key issue concerned the extent to which the ATO's communication and engagement allowed tax practitioners to take early preventative action and minimise adverse impacts. The IGT believes that if the migration from the ATO Portals to other platforms is not carefully managed there could be a substantial increase in telephony and other traditional mediums increasing costs, productivity loss and frustration for all parties.

4.58 The ATO's approach to minimising the migration risks is to initially maintain the ATO Portals and operate them in parallel with the new systems. The ATO Portals would only be decommissioned after consultation with tax practitioners.

4.59 The IGT takes a great deal of comfort from the above ATO approach as it substantially reduces the risk of adverse impacts on tax practitioners during the migration. Operating the old and new systems in parallel is more costly, however, it will provide tax practitioners with a more orderly transition to the new platform and a 'safety net' if significant difficulties arise.

4.60 Appendix 6 contains a range of enhancements to the current ATO Portals identified by tax practitioners during this review. Other improvements have also been raised in ATO surveys and workshops. To the extent that such enhancement or improvements are still necessary following the migration, they could be considered in subsequent upgrades.

Recommendation 4.1

The IGT recommends that, with respect to the ATO Portals, the ATO should:

  1. publish performance reports on a regular basis;
  2. publish a practical online user guide which includes information on their functionality and solutions to common issues; and
  3. provide an expected completion date for the migration to the new platform and if such a date is unlikely to be in the next 12 months, commence implementing the key improvements sought by tax practitioners to the existing systems.

ATO Response

In relation to 4.1 (a) - Agree

The ATO commits to publishing additional information in relation to the system performance within the network of the ATO. The amount of information that we can publish relating to the performance of the practitioners online systems is restricted as we do not have access to the system performance of each practitioner.

In relation to 4.1 (b) – Agree

Work on improving online guides has been ongoing since December 2014 and we are currently consulting with the tax profession on further refinement. We are also working with ATO support staff to guide the development of practical how-to guides and YouTube videos for standard functions.

The ATO will review all published issues that affect either availability of function or accuracy of information and provide regular updates on the progress of redressing these issues.

In relation to 4.1 (c) – Agree in part

The ATO, professional associations and software developers will continue to work together on improvements to the portal and practice management software.

We anticipate that the portal functionality will be available via ATO on-line within the next 2 years. Enhancements to the current portal will be limited to maintenance and stability assurance.

SBR and the migration of ELS functionality

4.61 Many countries are currently progressing whole-of-government strategies to provide a single portal for government services, a single source of information from government and a single authentication in dealings with government.223 Such strategies rely on the sharing and reuse of reported data, implying a need for standardisation of required data.224 Standard Business Reporting (SBR) is one such strategy.

4.62 Since 2010, Australia has pursued the adoption of SBR which aims to simplify business reporting obligations through a standard approach to online or digital record-keeping, collection of electronically reported information and distribution of that information to the appropriate government agency.225 As such, SBR is not an information technology system but a 'collection of core services, data and message standards that uses a hub or mail centre.'226

4.63 The intended benefits of SBR for tax practitioners from a government perspective include the following:

  • Reduction of data entry - information is gathered directly from your clients' business records.
  • Increased productivity - less time spent on administrative activities gives you more time to provide expert advice to clients.
  • Sharing information – you can be part of your clients' business online and in real time to help them to understand how their business is tracking.
  • Greater certainty – if you have a subscription or cloud based package, changes to reporting legislation are updated through your software provider.
  • Real time validation - you will get confirmation that reporting obligations have been completed and lodged.
  • Security - using AUSkey you can be assured of secure transmission.227

4.64 In accordance with the Government's SBR initiative, the ATO intends to upgrade its online platform to facilitate SBR. These plans include the phasing out of the ELS over the 1 July 2016 to 1 July 2018 period. The ELS has been used by tax practitioners since 1990 as the primary means to electronically lodge their clients' income tax returns, activity statements and other tax forms as well as a channel to request and receive various reports from the ATO.228

4.65 Tax practitioners will now be expected to implement SBR-enabled practice management software to lodge their clients' forms.229 Taxpayers will also be encouraged to adopt SBR-enabled business accounting software.

Stakeholder concerns

4.66 Stakeholders have generally supported the SBR's aim of streamlining reporting requirements for different government departments such as ASIC and the ATO. Some also supported mandatory adoption of SBR-enabled accounting software for larger businesses due to the efficiencies which may be realised. Tax practitioners with smaller taxpayer and business clients, however, were concerned that some of their clients may find it difficult to adopt SBR-enabled software for a number of reasons, including that:

  • adopting such software may not realise the intended benefits as differences in accounting approaches or quality of accounts may require tax practitioners to manually adjust information before it is reported to the ATO;
  • their clients may be reluctant to provide real-time information to government and the ATO which would take focus away from their business operations; and
  • information may not flow through to different government agencies if the departments themselves did not have SBR-enabled software.

4.67 Some smaller tax practitioners also indicated resistance in adopting the new SBR-enabled practice management software as they did not consider the benefits worthwhile. Concerns were also expressed with ATO comments that part of the $500 million savings expected to be generated by SBR will come from reduced tax practitioners' fees (see below for more details)230. Doubts have been raised with such estimates as the ATO will incur substantial costs in taking action in response to information being incorrectly reported.

4.68 Concerns were also raised with the ATO's control of the future lodgment platform and that its maintenance may effectively be transferred to various private sector software providers. As a result, the ATO would reduce its understanding of the lodgment and software related issues faced by tax practitioners. Some suggested that without clearly setting out responsibilities to address such issues, it would be difficult to determine the accountabilities of software providers and the ATO.

Migration of ELS functionality to SBR enabled practice management software

4.69 Although the ATO plans to decommission the ELS on 30 June 2018, it intends to migrate the 'features, functions and services currently supported by [the] ELS to appropriate ATO delivery or data collection channels' through a series of releases.231 The ATO's focus is not to make enhancements to the ELS' functionality but to migrate that functionality to the ATO's new online environment without 'degradation in service, functionality or client experience'.232 Although the ATO intends to consider some 'irritants' in the current system during this work, it does not intend to address all defects and limitations.233

4.70 To ensure that lodgment data reported by tax practitioners to the ATO accords with SBR standards, the ATO will provide commercial accounting software providers with the specifications for each form required to be lodged with the ATO. The ATO will no longer produce the electronic lodgment software specification used by software providers to develop ELS accounting software from 2016 onwards.

4.71 The ATO is aiming to ensure all interactions with the ATO will be supported by SBR by 1 July 2015,234 with no new forms and services being added to ELS from

1 July 2016.235

4.72 The ATO's implementation of SBR began in 2010. The migration of the ELS' functionality to an SBR-enabled environment commenced with the release of SBR taxonomy to software developers in 2014. This taxonomy sets out the data items required to be reported to the ATO.

4.73 The ATO has stated that all software developers should commence development of software packages from July 2014 with production pilots to be available by no later than December 2014.236 For the 2014–15 financial year,237 the ELS and the ATO's systems to capture forms lodged by SBR-enabled software will operate in parallel. The timeline in Appendix 8 provides a high level outline of the ATO's plans.

4.74 The ATO has acknowledged that the proposed implementation timeframes for providing SBR-enabled lodgment software is 'aggressive with ambitious delivery timeframes'.238 Software developers have also noted that their ability to meet the deadlines depends on timely access to ATO information.239

Adoption of SBR

4.75 Of the approximately 2.1 million actively trading businesses in Australia,240 21,000 (1 per cent) collectively lodged approximately 396,600 tax-related reports with SBR-enabled software during the 2013–14 financial year.241 Compared to the previous year, there was a ten-fold increase in the use of such software by businesses from approximately 2,100 to over 21,000. The numbers of commercial software providers licenced to develop SBR-enabled products (from 129 to 169) and SBR-enabled products in the market (from 33 to 54)242 also increased.

4.76 The ATO has identified a key impediment to broader tax practitioner and taxpayers adoption of SBR. They state:

Although software developers recognise the benefits of SBR, they do not see a market opportunity to develop SBR-enabled software as long as ELS continues to be supported by the ATO.243

Promotion of SBR by the ATO

4.77 The ATO currently undertakes a number of activities to improve tax practitioners' awareness and understanding of SBR-enabled practice management and accounting/business software, including:

  • online discussion groups;
  • providing information on the ATO and other government websites; and
  • formal consultation arrangements and conferences, including the FTP and the National Tax Practitioner conference.

4.78 The ATO also uses its general communications with tax practitioners to make them 'aware of the online service changes at a high level.'244 Such communication includes speeches about the impact of the move to SBR. For example, there have been recent reports that the Second Commissioner — PSSG, in a speech to the Accountants Technology Showcase Australia in October 2014, stated:

The red-tape reduction savings from SBR, which is a priority for the government, total probably $500 million in the economy. A lot of that will come from professional fees. To resist that is to resist microeconomic reform and economic efficiency and productivity growth. It's not always comfortable when the bus comes to your door for the change but at the moment this is one place where the bus is coming.245

4.79 The ATO also expects tax practitioners to seek out information about SBR from their software providers.246 Accordingly, the ATO supports these providers as well as professional bodies to provide information about SBR to tax practitioners.247

4.80 During this review, software providers and tax practitioners requested more detail on the transition to SBR, such as the ATO's project plan and a clear timeline.248 Subsequently, the ATO updated its website by providing a 'Roadmap of change for tax professionals' providing information on the changes as well as the work required and the support available.249

IGT observations

4.81 The benefits of SBR, such as a reduction of data entry, increased productivity and the sharing of information, are contingent on tax practitioners and their clients using SBR-enabled practice management and accounting/business software.

4.82 While SBR was introduced almost 4 years ago, recent statistics show that the take up by businesses has been low, with only approximately 1 per cent of all Australian businesses directly lodging reports through SBR. Similarly, take up has also been low among tax practitioners.250

4.83 Based on submissions to this review and the ATO's observations of software developers, the minimal demand for SBR-enabled software arises from a perception that the benefits are insufficient to outweigh the set-up costs of implementation. Therefore, to influence the increased adoption of SBR-enabled products, government is faced with effectively mandating its use or making it more appealing.

4.84 In the tax system, the ATO also faces challenges and risks which impact the willingness of tax practitioners and business taxpayers to take up the needed software. Tax practitioners may be forced to move away from their pre-existing systems which are entrenched in their business processes.

4.85 Unless developers seamlessly update currently provided software, decommissioning the ELS will require tax practitioners to upgrade their practice management software to lodge electronically and, therefore, increase demand for SBR-enabled software. However, there is a risk that unnecessary burdens will be placed on tax practitioners and the tax system if insufficient importance is placed on the user experience. As cautioned by the OECD:

Mandating is hardly ever a popular decision, which may put the revenue body in the political, media and public spotlight. Combined with poor self-service design, it may result in increased aggregate service demand and create reputational challenges for the revenue body.251

4.86 Furthermore, retiring the ELS may not influence taxpayers to adopt compatible software. Without increased taxpayer uptake of such software, many of the benefits expected to arise for tax practitioners may go unrealised. Accordingly, the successful implementation of SBR in the tax system relies, in large part, on the broader taxpayer adoption of SBR-enabled accounting software.

4.87 The IGT believes that the ATO should work closely with tax practitioners to understand and respond to causes of tax practitioner and taxpayer resistance to adopting SBR-enabled software. Such co-operation, however, will be difficult if tax practitioners are pushed towards products which may not provide full functionality and may expose the ATO to the risk of lower practitioner engagement and satisfaction. In this respect, ATO messaging to tax practitioners that they need to 'evolve or die'252 may not evoke the desired response.

4.88 The ATO could also work more closely with software developers as well as tax practitioners and taxpayers to focus more on the user experience of the resulting software. Such improved user experience as well as other benefits of adopting SBR could be better communicated to all the relevant parties.

4.89 Furthermore, the ATO could consider targeted financial incentives to reduce set up or upgrade costs for tax practitioners. It could also adopt concessional treatment during the transition period, such as allowing the deferral of certain payments or lodgment obligations without penalties being incurred — as was done in the United Kingdom in broadly similar circumstances.253 Tax practitioners and taxpayers could be made aware of such treatment well in advance of the transition period.

4.90 As stated earlier, once the ELS is retired, the ATO will provide SBR specifications to software developers which will be used in their design and development of practice management software. There is a potential risk that issues may remain unaddressed if there is insufficient clarity on the roles undertaken by the ATO and software providers in discharging their respective responsibilities in addressing tax practitioner lodgment issues. The IGT notes that the respective responsibilities and accountabilities should be publicly articulated to provide clarity for the ATO, software providers and tax practitioners.

4.91 There is a transitional risk that a decrease in expected functionality would adversely impact tax practitioners' businesses, leading them to pursue other, more expensive channels to undertake their tasks. The ATO could minimise this transitional risk by only discontinuing the ELS after consultation with the tax practitioner community on the effectiveness of the new system. While this may extend the planned period for concurrent lodgment platforms, it would provide tax practitioners with an alternative lodgment platform in the event that SBR-enabled software and the ATO's systems are not meeting expected service standards.

4.92 Lastly, the IGT is of the view that SBR education and training for tax practitioners will be needed to reduce the risk of incorrect reporting and demand on the ATO's telephony channel from taxpayers and tax practitioners seeking assistance. The IGT believes that the ATO could provide educational materials such as online tutorials delivering practical guidance that would assist tax practitioners with the transition to SBR.

Recommendation 4.2

The IGT recommends that as part of the transition from the ELS to SBR-enabled software, the ATO:

  1. work closely with tax practitioners to better understand the barriers to adopting SBR for tax practitioners and taxpayers;
  2. in collaboration with software developers and tax practitioners, seek to optimise the user experience of the resulting SBR software;
  3. communicate the benefits of SBR to both taxpayers and tax practitioners and consider providing incentives to the latter to adopt it;
  4. publish the respective responsibilities and accountabilities of the ATO and software providers so that software-related issues can be appropriately addressed;
  5. delay the retirement of the ELS until after consultation with the tax practitioner community on the effectiveness of the new system; and
  6. provide practical guidance material to taxpayers and tax practitioners to assist them with the transition to SBR.

ATO Response

In relation to 4.2 (a) – Agree

We are already working closely with software developers and professional associations to ensure tax practitioners are aware of the changes and to ensure software developers' products are adopting SBR.

In relation to 4.2 (b) – Agree in principle

Whilst we will work with our partners to design the services to be made available through software, user experience design of commercial software is driven by the software developers.

In relation to 4.2 (c) - Agree in part

The ATO agrees to communicating the benefits of SBR but will not be considering incentives to adopt.

In relation to 4.2 (d) - Disagree

We agree with the intent of ensuring an effective means for tax practitioners to deal with system issues but do not agree this would be supported by publishing the responsibilities of software developers and the ATO. We will look at ways to improve the quality of the guidance to ensure tax professionals know what to do when they experience system issues when using their software.

In relation to 4.2 (e) - Disagree

The ATO is currently committed to completing the transition to SBR by 1 July 2016, but we will continue to review contingency arrangements as the project proceeds.

In relation to 4.2 (f) – Agree

The ATO will provide guidance through communications and engagement activities on what is needed to transition to SBR.

ATO website

4.93 The ATO uses its website to communicate with tax practitioners, as well as provide them with access to important ATO forms, tax technical information, guidance and publications, and various tools.

Stakeholder concerns

4.94 Stakeholders have raised concerns in relation to the ATO website's useability and accessibility which ultimately impacts on their ability to find relevant information. In particular, the website was difficult to:

  • navigate particularly because of the presence of broken links;
  • search with many finding a search through google to be more effective; and
  • locate important material which should be prominently displayed, such as common tax forms and instructions and provided in a 'printer friendly' version relieving users of the need to print each page separately.

4.95 These sentiments were echoed in a recent survey of online communication with tax professionals. In that survey, it was found that close to a third of website users believed the information they needed was not easy to find as the menus did not make it easy to navigate and that the search engine was ineffective.254

4.96 Stakeholders also asserted that the launch of the ATO's redesigned website, on 26 June 2013, was poorly planned as it occurred during the busiest period of the year, resulting in a productivity loss while tax practitioners re-familiarised themselves with the new site. They also believed that the ATO website was not sufficiently tested prior to its launch.

ATO materials

4.97 In October 2013, the ATO established a Website Limited Life Working Group with representatives from the professional associations to explore concerns with the website. The group was disbanded on 22 November 2013 and resulted in the ATO:

  • identifying the root cause of broken links and dedicating resources to correct any broken links;
  • releasing a print friendly function on the website; and
  • resolving some of the concerns with the basic search function.255

4.98 On 31 October 2014, the ATO also renamed one of the webpages to the 'Tax professionals newsroom' to better represent the information found on that page.256 However, a consequence was that the location of webpages was changed, resulting in a number of broken links.

4.99 The following message was provided on the ATO's website to warn tax practitioners of these changes:

As we improve information, you may need to replace links and bookmarks to web pages you use regularly. We understand this will cause frustration however it is unavoidable when making improvements.257

4.100 On 3 November 2014, the ATO released an update on the upcoming changes to its website:

We are progressively reviewing all information on our website so it better meets your needs. Information will be easier to find and understand with improved menus and examples where required.258

4.101 The ATO also stated that they were working with an accredited business partner of the search function's supplier.259 The ATO believes that the imbedded search engine is expected to improve over time as it 'learns' to output relevant results much like Google.260 The following improvement examples were also recently announced on 16 February 2015:

  • You can filter your search results by the area of our website you want to search as well as by current or previous years (more date filtering options will soon be available).
  • You will see relevant ATO definitions displayed with the search results. This will allow you to see where we may have referred to something differently and you can refine your search, if necessary.
  • We will provide links to other popular information related to your search, where applicable.
  • The bottom of the search result page will show related search options.261

IGT observations

4.102 Since the website was introduced in 1998 and subsequently updated in 2013, it has become an important resource for tax practitioners, particularly in relation to tax technical information, forms and 'practice type' information.262 Therefore, any difficulties in finding relevant information on the website not only impacts tax practitioners' work but may also require ATO assistance and increases administrative costs.

4.103 The ATO did respond to stakeholder concerns by establishing a limited life consultative forum with representatives from the professional bodies. As a result, a number of concerns were addressed as set out above. The ATO has advised that the work continues and it is progressively reviewing all information on the website.

4.104 The IGT considers that as the ATO website is a fundamental tool for all citizens, the design and release of updates and new versions of the website need to be carefully considered. Where the website is working well, it allows users to move toward a greater level of self-service. There are a number of ways in which the ATO can facilitate a smoother experience for website users, including improved dialogue in relation to the design and improvements sought. In relation to tax practitioners, this approach may also include analysis via real-time analytics and user-centred design approaches to gain insight into experiences, preferences and expected behaviour. For example, such analysis could reveal the web content which is most important to the user and determine how it could provide easy access to this information, thereby optimising the tax practitioner experience.263

4.105 Importantly, the ATO website also presents opportunity to provide interactive assistance without the need for practitioners to telephone the ATO's call centres. For example, a 'web chat' assistance tool could assist users by providing information on the ATO's website as and when they visit the site. Another example would be to provide a regularly updated FAQ on common website queries made by tax practitioners.

Recommendation 4.3

The IGT recommends that in relation to its website, the ATO should:

  1. improve the website's ease of use by better taking into account tax practitioners' needs and concerns; and
  2. develop a 'web chat' functionality that provides tax practitioners with helpful information.

ATO Response

In relation to 4.3 (a) – Agree

In relation to 4.3(a) – We have undertaken research and consultation with tax professionals to understand how we can make improvements to the website and our online communication channels.  Many of the priorities from the research and consultations have been implemented with positive feedback received.  More are being progressed in 2015. We are currently undertaking further research to gauge how tax professionals are responding to the improvements and to enable us to consider our next program of work to improve ato.gov.au.

In relation to 4.3 (b) – Disagree

The ATO has heavily invested in the search functionality and improving web content. The feedback about the changes has been very positive. The current research will explore if further work is required since these changes were made.

The ATO telephone services to tax practitioners

4.106 Tax practitioners may direct queries to an ATO officer by using the registered agent telephone service. This phone service is available between 8.00am and 6.00pm Monday to Friday.

4.107 Due to the costs associated with delayed calls, many organisations, who operate such telephone services, seek to improve first contact resolution as an important objective. The reason is that it is indicative of how effectively the customer's requests are being handled and the quality of the customer experience.264 In 2013–14, tax practitioners made approximately 1.4 million telephone calls to the ATO.265 Of these calls, approximately 27,000 (2 per cent) were abandoned and 48,000 (3.4 per cent) were either escalated or transferred by the ATO officer answering the call.266 The remaining calls (94.6 per cent) were answered and the issues raised were resolved during the first call.267

Stakeholder concerns

4.108 Tax practitioners raised a range of concerns with the registered agent telephone service. These included frustrations with ATO delays in answering calls or calls dropping out which required tax practitioners to call again and recommence the enquiry and escalation process.

4.109 The telephone service was also considered to be ineffective for resolving complex matters as operators had limited authority, accountability, technical capability and understanding of tax practitioners' practices. As a result, many tax practitioners opted not to use the service for technical assistance and limited use to simple administrative or system queries, such as interest and penalty remissions and setting up payment arrangements. Tax practitioners also noted that due to ATO phone operators using scripted responses when dealing with enquiries, they did not always seek to understand the issue and appeared indifferent to whether the caller's issue was resolved.

4.110 Furthermore, the quality and consistency of advice given to tax practitioners was raised as a concern. The advice was found to be at times inconsistent with the material on the ATO's website and/or advice provided by another ATO officer. Stakeholders also noted inconsistency in tasks that ATO officers were able to perform over the phone. In some instances, requests for changes to lodgment from monthly to quarterly were done during a phone call, whilst other officers insisted that the request had to be in writing.

4.111 Stakeholders also expressed frustration with the ATO's proof of identity (POI) procedures. Tax practitioners indicated that POI was difficult to establish because complex information was often required and not always easily accessible, for instance in transit or during a client meeting. In addition, they expressed frustration that POI procedures are often repeated when calls are transferred to a different person within the ATO. Furthermore, when ATO officers called tax practitioners, they require the practitioner to verify their identity without any need to provide POI themselves. This was seen to be particularly concerning because ATO officers often requested confidential information about clients which may expose tax practitioners' clients to identity fraud.

4.112 Frustration was also expressed with ATO operators who do not provide their contact details, resulting in follow up calls with different officers about the same matter.

ATO materials

4.113 While the ATO appears to offer a dedicated registered agent telephone service line, calls from tax practitioners are answered by the same pool of call centre operators that handle taxpayer calls. However, tax practitioner calls are given priority in the queue.

4.114 The ATO aims to answer 90 per cent of tax practitioner calls within 2 minutes.268 In 2013–14, the ATO exceeded this target by answering 92 per cent,269 with an average wait time of 33 seconds.270 This performance is substantially the same as that in the two preceding years.271

4.115 Tax practitioners may input Fast Key Codes (FKC) that allow calls to be directed to the relevant areas of the ATO's call centre. Calls are usually directed to the Customer Service and Solutions (CS&S) business line which handles the majority of tax practitioner calls. Prior to 4 August 2014, a small percentage of calls272 were answered by the Tax Practitioner Services (TPS) area within the TPALS business line.273

Recent developments and changes

4.116 A number of recent developments and changes occurred during this review. These were aimed at reducing the number of transfers and instances where ATO officers resolve issues outside the phone call (non-phone escalations (NPEs)). These changes include:

  • transitioning the inbound TPS telephony service to the CS&S business line;
  • transitioning the inbound Small Business / Individual Taxpayers (SBIT) telephony service to the CS&S business line; and
  • changing call centre policies, procedures and practices to improve ATO operator ability to resolve tax practitioner calls at the first instance.
Transitioning the inbound TPS telephony service to CS&S

4.117 Analysis conducted by the TPALS and CS&S business lines on a sample of 354 calls received by the TPS area between July – December 2012 observed the following in relation to transferred calls:

  • 39 per cent of total calls going directly to the TPS area were subsequently transferred to other business lines;
  • 25 per cent of calls were transferred into the TPS area from other ATO business lines with 29 per cent of these calls subsequently transferred by the TPS area to other business lines, involving a minimum of three operators in each such call;
  • only 58 per cent of total calls directed to the TPS area were able to be resolved without the need to transfer or escalate the call; and
  • 100 per cent of the calls were either scripted or scriptable.274

4.118 The performance of the various types of calls taken by the TPS area between 1 July 2012 and 19 November 2012 echo the above findings which are set out in Table 10 below.

Table 10: TPS queue performance (1 July 2012 and 19 November 2012)
Description Calls Answered Average Hold time

%

Consult % Transfer % NPE % Resolve
Handle Time Talk Time After Call Work Time
Electronic Lodgment Service (ELS) 12,141 459 225 175 26% 4% 33% 17% 53%
Practice Administration 8,601 433 210 172 24% 3% 58% 6% 42%
Portals and Website Navigation 21,646 424 217 167 19% 3% 38% 5% 60%
Disasters 1,901 272 124 109 31% 6% 79% 0% 24%
Practice Address Updates 1,550 385 207 164 7% 1% 29% 0% 72%
Rendezvous 55 469 243 180 19% 2% 25% 7% 73%
ELS Escalations (by phone) 4,821 580 303 223 18% 2% 10% 0% 90%
Other TPS Escalations (by phone) 10,415 363 190 142 17% 2% 38% 0% 63%
Totals 61,130 429 217 167 21% 3% 39% 6% 58%

Source: ATO.

4.119 Due to the above findings, the inbound TPS telephony service was transitioned to the CS&S business line on 4 August 2014.275 The following improvements were expected to be realised as a result of this transition:

  • increased first contact resolution rates though a reduction in the number of transfers and escalations across business lines;
  • reduced average handling times through a reduction in the number of transfers across business lines;
  • opportunities to draw on a broader skill set to build on the service provided;
  • consistent approach in the management of inbound telephony and better capacity to roster for peaks and troughs through greater resourcing; and
  • increased client service window.276
Transitioning the inbound SBIT telephony service to CS&S

4.120 The inbound SBIT telephony service was also transitioned to the CS&S business line in February 2014.

4.121 Call analysis was conducted jointly by the SBIT and CS&S business lines on calls received between July 2013 – June 2014 which identified:

  • 65.4 per cent of total calls answered by the SBIT business line were transferred from other business lines;
  • 7.8 per cent of calls transferred into the SBIT business line were subsequently transferred to other business lines, resulting in a minimum of three call centre operators being involved in the enquiry;
  • 12.7 per cent of calls received directly by the SBIT business line were transferred to other business lines; and
  • staff were under-utilised, with occupancy rates at approximately 65 per cent (compared to 97 per cent for the CS&S business line).277

4.122 The expected outcomes of the transition were a reduction in call volumes, call handling times and NPEs as well as increased rates of first contact resolution.278

Improving the ability to resolve tax practitioner calls at the first instance

4.123 The ATO's CS&C business line has also sought to improve its ability to resolve tax practitioner calls at the first instance, as well as reducing the creation of approaches that delay resolution (such as NPEs and transfers).

4.124 In July 2013, the ATO implemented a 'floor support' strategy which required telephone operators to seek real time assistance from technically proficient staff (otherwise known as 'floorwalkers'), rather than transferring or escalating queries to seek out specialist assistance:279

CSRs [Client Service Representatives] are to request the assistance of floorwalkers only after having attempted to research an answer to a customer's enquiry. At the same time they must seek assistance from the escalation queue.

NPEs are not to be raised unless there is a clear requirement to do so - if a floorwalker can provide the answer to the CSR the CSR should provide it to the customer unless the complexity of the issue (and the CSRs lack of familiarity with it) jeopardises the quality of the interaction with the customer. NPEs should only be raised if agreed to by a floorwalker or escalation queue specialist. If neither is available and the CSR is unable to deal with the enquiry an NPE may be raised.280

4.125 Floorwalkers are expected to be on call to assist phone operators when answering a caller's enquiry. Floorwalkers are also expected to record the details of each request for assistance in a database and provide feedback to team leaders and senior advisers on a regular basis. Such issues were aimed to be addressed through mechanisms such as coaching or training sessions.281

4.126 Figure 2 below is an ATO flow chart of their escalation and feedback process for phone operators when seeking assistance to answer a caller's enquiry.

Figure 2: On-site escalation support flow chart

Figure 2: On-site escalation support flow chart

Source: ATO.

4.127 The ATO's detailed explanation of the above flowchart is reproduced below:

  • CSRs will seek assistance from floorwalkers and the escalation queue simultaneously.
  • The SQM [Skilling & Quality Manager] … within sites will work together to assign floorwalkers to team(s) or groups of staff for periods of no less than a week to develop awareness of team needs. The only exceptions to this will be to cover unplanned leave.
  • Floorwalkers are to have an initial briefing with a senior adviser and the team leader(s) at commencement of a rotation.
  • Team leaders are to provide floorwalkers with advice regarding expectations and known issues within the team.
  • Floorwalkers are to enter details of every request for assistance into the OSES database used in their site.
  • Floorwalkers are to informally debrief team leaders daily on:
    • Staff apparently in need of training
    • Behavioural issues
  • Floorwalkers are to formally debrief at week's end with team leaders and senior advisers.
  • Senior Advisers are to collate weekly reports on significant endemic and/or emerging issues and submit them to the SQM and the site's contact centre leadership group.
  • The SQM is to recommend and implement processes to address issues at the individual, team and site levels. Issues having a broader impact will be raised with the SQM Network.
  • Team Leaders will review NPEs generated from within their own team to identify knowledge and skilling issues and/or behavioural issues requiring attention, and will take steps to address them.282

4.128 The ATO also expects the following call centre staff to focus on improving phone operator knowledge and capability:

…CSRs operating as floorwalkers: Floorwalkers are expected to roam and observe CSR behaviours - including call management techniques and system navigation methods. They are to take over calls as necessary, educate CSRs (not just provide answers), and provide verbal or written feedback to team leaders, senior advisers and the SQM. In addition they are to gather and submit intelligence, and enter information into relevant databases.

…Senior advisers: Senior advisers are to brief and debrief with floorwalkers regularly (daily if necessary), review floor walking data to identify trends and systemic issues, and co-ordinate (with team leaders) additional support for CSRs requiring it.

…Skilling & Quality Manager (SQM): The SQM will co-ordinate the allocation of floorwalkers to teams/staff and analyse local escalation support data to identify systemic needs. The SQM will be the conduit to enabling areas for issues requiring attention on a broader scale.

…Team leaders: Team leaders will analyse local escalation support data and debrief with floorwalkers to identify skill and knowledge gaps their staff may have. They will liaise with the SQM/senior advisers to prepare developmental plans to address those gaps. Team leaders will work with their peers and Assistant Directors to address broader issues within the site. Issues requiring attention will be addressed through coaching or other appropriate mechanisms.283

4.129 A number of other changes were also implemented by the CS&S business line to improve operator ability to resolve tax practitioner calls at the first instance, including:

  • no longer giving priority service to internal transfers with effect from October 2013;284 and
  • from January 2014, requiring telephone operators to send NPEs directly to their team leaders which would allow for real time coaching and contribute to a reduction in NPEs.285

Call handling

4.130 Although the ATO aims to resolve calls at the first instance, calls involving complex income tax advice from tax practitioners may require transfer or escalation to another ATO officer.286

4.131 Figure 3 below shows the percentage of tax practitioner calls that did not involve a transfer or require a NPE (resolve rate), a percentage of transferred calls answered (transfer rate) and percentage of NPEs (NPE rate), by the subject of the call.

Figure 3: Resolve, transfer and NPE rates (July 2013–June 2014)

Resolve, transfer and NPE rates

Figure 3: Resolve, transfer and NPE rates (July 2013–June 2014)

Source: ATO, CS&S & TPALS – July 2013 – June 2014 Service Delivery Insights, p8.

4.132 Figure 3 reveals that tax practitioner calls on certain issues such as the superannuation surcharge, other superannuation matters, personal income tax return lodgment through Tax Pack and E-Tax, complex income tax advice, Goods and Services Tax (GST) and excise issues experience the highest transfer rates (46 per cent, 26 per cent, 30 per cent, 25 per cent, 24 per cent and 24 per cent respectively).

4.133 Furthermore, tax practitioner complaints, personal income tax, business income tax and withholding variation issues have the highest rates of NPEs.287 Whereas matters relating to CGT and accounts experience the lowest transfer rates.

Staff skilling and performance

4.134 According to the ATO, all telephone operators are trained on five topic areas, namely Business, Debt, Individuals, Superannuation and Advice.288

4.135 Each of these five topics have three tiers of ATO officer expertise. Tier 1 represents the basic level of expertise and tier 3 represents the specialist level. Table 11 below shows the specific skills that encompasses each of the five topic areas, by tier.

Table 11: CS&C skill sets
  Business Debt Individuals Superannuation Advice
Tier 3 Specialist Specialist Specialist Specialist Specialist
Tier 2

PAYG

Accounts

Excise

GST

Security Assessed Clients

Payment Arrangements

Self Help Dropouts

Debt Letter Responses

Security Assessed Clients

PAYG

CGT

Foreign Income

First Home Saving Account

Income Tax Withholding Variation

Security Assessed Clients

Co-contribution

Superannuation Guarantee

Superannuation Holding

Account Reserve

SuperChoice

Surcharge

TaxPack A3

Employment Termination Payment

Reasonable Benefit Limits

SMSF

Electronic Data

Security Assessed Clients

GST

Business Income Tax

CGT

Tier 1

Registrations, Remissions, AUSkey, Business Activity Statements, TaxPack,

Simple Superannuation, Lost Members Register, Departing Australia Superannuation Payment, Tax Pack T3, Accessing Super and Portability

Foundation

Client Updates, TFN/ABN Applications, Tax Evasion Referral Centre, Wickenby,

Simple alternate work types, Online Services, eTax, myTax, myGov

Source: ATO, CS&S Services Model.

4.136 The model composition of telephone operators' skills within the CS&C business line is also shown in Table 12 below.

Table 12: Model workforce skill composition
Tier Business and Debt Individuals and Debt Superannuation
3 2% 2% 0.26%
2 23% 14% 4%
1 54%

Source: ATO, CS&S Services Model.

4.137 Table 12 shows that the model state of the workforce is that 54 per cent should be trained at the Tier 1 level, 41 per cent at the Tier 2 level and 4.26 per cent at the Tier 3 level.

4.138 The ATO also conducts quality assessments on telephone interactions. Any findings are documented to provide feedback and to identify the coaching needs of staff.289 The assessment concentrates on the individual's actions and associated procedures, for example:290

  • What action did the officer take and was it consistent with the procedures?
  • How well did the officer observe, collect and record objective evidence?

4.139 Assessment are based on three elements, namely service, quality and cost as well as ten criteria which include:

  • Service – Interpretation of customer request/situation;
  • Service – Appropriate interaction style/Professionalism;
  • Service – Interaction protocols applied;
  • Service – ATO Values and Behaviours;
  • Quality – PORO/Privacy;
  • Quality – Appropriate system information and procedures used effectively;
  • Quality – Outcome appropriate to customer situation;
  • Quality – Information conveyed accurately and completely;
  • Quality – System actions/updates completed correctly; and
  • Cost – Interaction handled efficiently and/or service standards met. 291

4.140 The results for the November 2014 assessments are provided in Table 13 below.

Table 13: November 2014 tax practitioner call performance assessments
Rating Number %
Silver 3 0.50%
Met Standard 341 53.70%
Met Standard – Coaching Required 155 24.40%
Met Standard – Immediate Coaching Required 110 17.30%
Standard Not Met 26 4.10%
Total 635 100%
Pass Rate   95.91%

Source: ATO.

4.141 Table 13 above shows that 41.7 per cent of call performance assessments identified the need for coaching notwithstanding that the call performance was considered to have met standard. Furthermore, 4.1 per cent of calls were considered to have not met standard.

Proof of identity (POI) protocols

4.142 POI requirements reduce the risk of third parties obtaining unauthorised access to client information.292

4.143 The ATO recently changed the POI requirements due to the TPB public release of tax practitioners' registration numbers. The changes removed the requirement for personal details when verifying POI and instead, ask for details that relate to the client's interaction with the ATO, such as recent293 information from a notice of assessment, details of ATO documents, ATO correspondence or lodged return. The information required depends on whether the tax practitioner is listed on the taxpayer's account and the scope of their authority.294

4.144 On 8 September 2014, the ATO introduced voice authentication, allowing taxpayers to record a short 'voiceprint' that can be used to verify their identity for future calls. Voice verification was introduced with the aim of speeding up the authentication process and reduces the time needed on the phone to the ATO.295 The voice authentication system is currently available to individuals calling on their own behalf or on the behalf of another entity, such as an individual or a company. However, future releases will support individuals acting in their role as an intermediary, for example a tax practitioner.

4.145 When ATO officers call tax practitioners, they are required to identify themselves by providing their full name and the section in which they work.296 However, if tax practitioners have doubts about the identity of the caller, they may:

  • ask for the officer's contact details, including
    • their full name
    • their extension number, if available
    • the name of their team leader and their extension number
  • ask the officer if you can phone them back on 13 28 69 between 8.00am and 5.00pm, Monday to Friday. This is charged at your local call rate.297

'Pushing' tax practitioners to online self-service channels

4.146 According to the ATO's website, where there is no online option, tax practitioners may direct queries to an ATO officer by using the registered agent telephone service.298

4.147 The ATO has stated that a number of telephone calls made by tax practitioners were unnecessary because their issues could have been addressed through self-service channels, such as the website and the ATO Portals.299 As a result, an initiative was piloted in March 2014 to 'strongly encourage' tax practitioners to use online services when they called the ATO for enquiries that could be self-served.300

4.148 From 1 September 2014, the ATO escalated its approach to a firmer one where staff would only action tax practitioner requests that could be self-served through online channels under exceptional circumstances:

Where transactions and information is available on the ATO Portals, Standard Business Reporting (SBR), Australian Business Register (ABR), the electronic lodgment service (ELS) or the electronic commerce interface (ECI), our call centre staff will advise you which channels can be used.301

4.149 The ATO has, however, stated that where services are not available through online channels, they will assist tax practitioners, including when system issues prevent tax practitioners from using online services.302

4.150 The ATO measures the performance of call centre operators in 'pushing' tax practitioners to self-service channels, which is set out in Table 14 below for the November 2014 month.

Table 14: November 2014 tax practitioner pushback performance assessments
Month Total assessments % of performance marked as 'coaching required', 'immediate coaching required' and 'standard not met'
September 843 2.61%
October 849 1.65%
November 635 0.79%
December 101 1.98%
Total 2428 1.77%

Source: ATO.

4.151 The reasons for a grade of 'coaching required,' 'immediate coaching required,' or 'standard not met' in individual cases include:

  • actioning Australian Business Number cancellations where the tax practitioner should have cancelled the number themselves;
  • performing POI unnecessarily which led to excessive call duration as the tax practitioner could have lodged a return not necessary on the ATO Portals or via ELS;
  • not advising the tax practitioner that progress of return enquiries are no longer a call centre function; and
  • not asking appropriate questions to determine the tax practitioner's situation which lead to ATO officers performing actions which could have been performed by the tax practitioner.303

IGT observations

4.152 At first glance it seems that the ATO's registered agent telephone service is operating reasonably well with 94.6 per cent of calls being answered and the issues raised being resolved during this first call. However, there may be aspects of call handling that require improvement.

Call handling and delays

4.153 Calls could be delayed for a number of factors, including the amount of times they are transferred or escalated to another ATO officer. Whether a call is transferred or escalated is influenced by a number of factors, including the complexity and type of issue, the experience of the officer, the quality of officer training and the tools that are available to the officer. As mentioned above, the ATO has undertaken a number of initiatives to reduce call times by addressing some of these factors.

4.154 Inevitably, some calls will require transfer or escalation. In such instances, call times could be minimised by the ATO operators expeditiously identifying the underlying issue and transferring the call to the appropriate person for resolution. To achieve such an outcome, the IGT believes that the ATO should monitor and report on the call handling time, i.e., the time from when the call is received to when it is transferred. Where the handling times are lengthy, the reasons for such delay could be explored and solutions developed. For example, questions could be developed for call centre operators to quickly identify which calls are too complex and to whom they should be transferred.

Staff skilling, abilities and accountability

4.155 As mentioned earlier, the ATO has implemented a number of changes during this review which were aimed at addressing tax practitioners' concerns with phone operators' ability to resolve tax practitioner calls at first instance. A key component of these ATO initiatives is to improve the skill level of call centre operators. For example, 'floorwalkers' are expected to educate and not just provide answers to operators while 'team leaders' are expected to identify skill and knowledge gaps in their staff.

4.156 The IGT believes that many of the strategies have potential to address the concerns raised by stakeholders, if appropriately implemented. However, as these strategies are still in their infancy, it is difficult to gauge their success. Furthermore, these strategies may take some time before the benefits are fully realised.

4.157 The IGT also expects that as electronic interactions with the ATO improve, common and simple transactions that are undertaken on the phone will be completed on various electronic self-service channels. The ATO's recent initiative to encourage tax practitioners to use online services is indicative of this change. The best form of encouragement is to ensure that the online services are effective and user friendly.

4.158 With the uptake of online services, in the near future, a greater proportion of call centre operators will most likely be required to handle complex and unique cases that cannot be easily addressed by self-service channels. Therefore, it is critical that the ATO aims to improve the knowledge and skill base of its call centre operators to ensure that they are capable of handling such cases in the future.

4.159 Table 12 above highlighted that the ATO's model workforce would have more than 50 per cent trained in simple matters involving registrations, remissions, AUSkey, BAS and TaxPack. However, less of the ATO's workforce are expected to be familiar with Tier 2 and Tier 3 level of expertise ranging from 2 per cent to 23 per cent of the workforce, depending on the subject matter.

4.160 The IGT is of the view that in line with the ATO's planned migration to SBR-enabled practice management software, the ATO should aim to increase the skill set of its workforce so that over time, the proportion of staff that have Tier 2 or 3 level of expertise increases. An increase in the level of expertise to Tier 2 and 3 levels will ensure more call centre operators will be capable of meeting the needs of the future.

4.161 Furthermore, the ATO does not train call centre operators on issues that are specific to tax practitioners, notwithstanding the dedicated telephone service to this market segment. With this in mind, the IGT believes that call centre staff should receive training that is particular to tax practitioners, such as commercial and whole of practice understanding, deferral requests and SBR.

POI protocols

4.162 Providing POI is important to ensure that callers are not misrepresenting themselves to unlawfully gain confidential information from the ATO about certain taxpayers. However, the IGT is of the view that the current POI requirements are onerous because they require tax practitioners to recall detailed information about the client.

4.163 The IGT believes that the ATO should explore opportunities to simplify the POI process. One option could be to use unique identifiers for tax practitioners and/or their client. Such an identifier could be used in subsequent calls in relation to the same client on the same matter. Similarly, it could be used by the ATO officer when contacting the tax practitioner about their client. The use of this identifier would allow the tax practitioner to be assured that the person on the other line is an authorised ATO officer. The ATO's current practice is for operators to provide their full name and the section in which they work, however, this information alone does not assure tax practitioners of the identity of the ATO officer.

4.164 Alternatively, the IGT understands that the ATO will expand its voice recognition software to tax practitioners which will simplify and overcome concerns raised by tax practitioners. As this technology has only recently been released to taxpayers, it is difficult for the IGT to gauge its success in terms of simplifying the POI authentication process. There are a number of security concerns with using such technology. For example, how should the system deal with a situation where tax practitioners move from one firm to another and their clients change. However, this situation is also a challenge for the existing POI processes.

4.165 It should also be noted that voice recognition may only be helpful for incoming calls and not when ATO officers contact tax practitioners.

Recommendation 4.4

The IGT recommends that, with respect to its telephone service for tax practitioners, the ATO:

  1. measure and report on the handling times taken between when calls are received and when they are transferred to the appropriate ATO officer;
  2. where such handling times are too lengthy, investigate how improvements may be made;
  3. increase its workforce ability to handle complex tax practitioner enquiries, including those requiring a whole of tax practice understanding; and
  4. simplify proof of identification requirements for tax practitioners by, for example, using unique identifiers and/or voice recognition software.

ATO Response

In relation to 4.4 (a) – Agree

This reporting is undertaken by our ATO contact centres.

In relation to 4.4 (b) - Agree

We meet all our current service standards. If our QA results in a particular queue suggest handling times are becoming too lengthy we would consider implementing improvements including providing training, support and resources.

In relation to 4.4 (c) - Agree in principle

There would need to be further analysis in relation to the specifics of the work type and associated capability gaps.

In relation to 4.4 (d) - Agree

When voice recognition is made available to third party representatives this will simplify proof of identification for agents.


179 ATO, Tax Agent Portal (31 March 2015).

180 TPB, Annual Report 2012-13 (2013) p ii; Above n 11.

181 Above n 83.

182 Above n 52.

183 ATO communication to the IGT, 6 May 2015.

184 ATO communication to the IGT, dated 6 May 2015.

185 Evidence to Standing Committee on Tax and Revenue, House of Representatives, Canberra, 27 August 2014, p19 (Geoff Leeper, Second Commissioner of Taxation).

186 Ibid.

187 Assistant Commissioner, Practice Risk and Consultation, Tax Practitioner, Lodgment Strategy and Compliance Support.

188 The monitoring is only applied to pages included in core transactions.

189 Above n 83.

190 Above n 185.

191 Ibid.

192 Above n 83.

193 ATO, System maintenance (7 April 2015).

194 Above n 185.

195 ATO, System maintenance and issues (4 November 2014).

196 Above n 83, p 2.

197 ATO, Business and practitioner – troubleshooting (31 March 2015).

198 Above n 83.

199 Above n 103, p 28; Above n 185, p 20.

200 Above n 103, para [2.191].

201 Ibid, p 48; Above n 185, p 20.

202 Above n 185.

203 ATO, Submission to the Tax and Revenue Committee, 2014 Annual Report of the Australian Taxation Office, 27 February 2015, para 97.

204 ATO, 'Lodgment Working Group minutes' (Internal ATO Document, 19 February 2015).

205 ATO communication to the IGT, 1 April 2015.

206 Above n 197.

207 ATO, 'Tax Agent Portal (TAP) Learner Workbook' (Internal ATO Document, 2014).

208 ATO, 'SMART training material – An introduction' (Internal ATO Document) p 1.

209 ATO, 'SMART – Tax Agent Portal and ELS' (Internal ATO Document).

210 ATO, 'Tax Practitioners and de-badging' (Internal ATO Document) p 1.

211 Above n 185.

212 ATO, 'Online Blueprint' (Internal ATO Document, 7 September 2011).

213 Above n 103, p 28.

214 ATO, Research – Tax Agent and BAS Agent Portals (29 January 2015).

215 Ibid.

216 ATO, Portal services consultation results (10 October 2014).

217 ATO, Portal survey - what you told us (13 October 2014).

218 A list of all functions is shown in Appendix 5.

219 ATO, Lodgment working group minutes, October 2014 (6 January 2015); Above n 203.

220 Above n 103, p 27.

221 Ibid, para [2.191].

222 Above n 52.

223 OECD, 'Self-service channels', above n 2, p 26.

224 Ibid.

225 ATO, How SBR works (1 July 2014).

226 ATO, 'Blueprint ELS to SBR program of work' (Internal ATO Document, 19 October 2012) p 11.

227 Standard Business Reporting, Benefits for intermediaries (22 October 2014).

228 Above n 226, p 16.

229 ATO, Standard business reporting capability ELS-SBR transition timeline (15 July 2014).

230 Accountants Daily, ATO warns accountants they face $500m shortfall (28 October 2014).

231 Above n 226, p 4.

232 Ibid, p 16.

233 Ibid.

234 ATO, 'Tier 2 project business case' (Internal ATO Document, June 2014) p 9; Above n 226, p 11.

235 Above n 226, p 16.

236 Above n 229.

237 Above n 234, p 10.

238 Above n 234, p 10.

239 ATO, ATO Future Tax Industry working group (18 December 2014).

240 Australian Bureau of Statistics, The number of Australian businesses have increased (2 March 2015).

241 Commissioner of Taxation, Annual Report 2013-14 (2014) pp 79 - 80.

242 Ibid, p 79.

243 Above n 226, p 11.

244 ATO, 'ELS2SBR Communications and consultation strategy' (Internal ATO Document) p 3.

245 Accountants Daily, ATO warns accountants they face $500m shortfall (28 October 2014); Above n 168, p 3.

246 Above n 229.

247 Above n 244.

248 ATO, ATO's Future Tax Industry Working Group for 2015/16 and 2020 meeting (18 November 2014).

249 ATO, Roadmap of change for tax professionals.

250 Above n 226, p 11.

251 OECD, 'Self-service channels', above n 2, p 63.

252 ATO, Delegate's handbook for the National Tax Practitioner Conference 2014: Systemic driving forces in the next decade (15 July 2014).

253 HM Revenue & Customs, Online filing of Company Tax Returns: two years on (undated).

254 ATO, 'Online communication with tax professionals survey 2014, Analysis of results from an online survey, 11-26 June 2014' (Internal ATO Document, undated) p 11.

255 ATO, ATO Website limited life working group: Key messages from meeting held 22 November 2013 (3 January 2014).

256 ATO communication to the IGT, 10 November 2014.

257 ATO, Improving our website is a top priority (3 November 2014).

258 Ibid.

259 ATO communication to the IGT, 6 May 2015.

260 Above n 255.

261 ATO, Try our improved search function (16 February 2015) .

262 ATO, 'Use of www.ato.gov.au, qualitative research report' (Internal ATO Document) p 6.

263 OECD, 'Self-service channels', above n 2, p 45.

264 Oracle, Best practices for improving first-contact resolution in the contact centre (2012) pp 1 and 6.

265 Above n 241, p 34.

266 Above n 241, p v.

267 Above n 241, pp v and 34.

268 Above n 241, p 34.

269 Ibid.

270 ATO, 'Service delivery insights', above n 83, p 6.

271 ATO, 'CS&S Heartbeat Report' (Internal ATO Document, June 2014).

272 As at 4 December 2012, calls answered by TPALS TPS comprised 9.2% of total tax practitioner calls answered by the ATO; ATO, 'Review of TPALS TPS Telephony Services, Office Minute' (Internal ATO Document, 31 July 2013) p 6.

273 ATO, 'TPS Telephony Services', Ibid, p 6.

274 ATO, 'TPS Telephony Services', above n 272, p 8.

275 ATO, 'Tax Practitioners, Lodgment Strategy & Compliance Support (TPLSCS): Jul 2014 – Oct 2014 Service Delivery Insights' (Internal ATO Document, undated) p 18; ATO, 'Service delivery insights', above n 83, p 25; ATO, 'TPALS TPS Telephony Transition to CS&S 31 July 2014 update' (Internal ATO Document,

31 July 2014).

276 ATO, 'Service delivery insights', above n 83, p 25; ATO, 'Office Minute: Review of TPALS Tax Practitioner Services Telephony Services' (Internal ATO Document, 31 July 2013) p 9.

277 ATO communication to the IGT, 29 January 2015.

278 ATO, 'Project Outline – CS&S 'Advice' skill alignment' (Internal ATO Document) p 10.

279 ATO, 'Service delivery insights', above n 83, p 3.

280 ATO, 'On Site Escalation Support' (Internal ATO Document, November 2013).

281 Above n 280.

282 Above n 280.

283 Ibid.

284 ATO, 'Service delivery insights', above n 83, p 3.

285 Ibid.

286 Ibid, p 9.

287 ATO, 'Service delivery insights', above n 83, p 8.

288 ATO, 'CS&S Services Model' (Internal ATO Document, undated).

289 ATO, 'Quality Evaluation Handbook: Telephony 2014/15' (Internal ATO Document, July 2014) p 8.

290 Ibid.

291 Ibid, p 9.

292 ATO, Proof of identity for registered agents (29 January 2015).

293 No more than five years old.

294 Above n 292.

295 ATO, ATO launches voice authentication(9 September 2014).

296 Above n 292.

297 Ibid.

298 ATO, Services and support (29 January 2015).

299 ATO, 'Jul 2014 – Oct 2014 Service Delivery Insights', above n 275, p 5.

300 Ibid, p 5.

301 ATO, Working Online (29 January 2015) .

302 Ibid.

303 ATO, 'TAG pushback Sep-Dec 2014' (Internal ATO Document, 10 December 2014).