Evaluation in Inland Revenue
The Inland Revenue Department has had a specialist evaluation team for the past 14 years, and current manager Prue Oxley has been part of the team for all but one of those years. The team of five works within the strategic development group.
Prue Oxley says people are often surprised about the outcome and policy focus of Inland Revenue's evaluation role. "But we've always thought in terms of outcomes. With any intervention, we think 'how does it contribute to encouraging voluntary compliance, reducing compliance costs and ensuring the integrity of the tax system.
"Our focus is strategic. We are dealing with the underlying principles of tax administration and looking at the effectiveness of interventions and how well they are contributing to ensuring people pay tax voluntarily, and ensuring that people receive the payments they're entitled to. We work closely with the strategic development people and with the policy people."
Inland Revenue has an important role in administering social policies such as child support, Working for Families, student loans and paid parental leave, which Prue's team also evaluates. "So it's a lot wider than just tax." Prue cites the joint evaluation project, led by the Ministry of Social Development, on the Working for Families programme as a new area of work. "Inland Revenue has a huge role in Working for Families. Most family financial assistance is provided as a credit through the tax system."
Another example of her team's work is in the area of reducing compliance costs for small businesses. "We are developing a measure of small business compliance costs to use as a benchmark to measure the effectiveness of specific policy changes." Then there is the evaluation of the impact that auditing taxpayers has on future compliance. "That's a continuing interest and is at the 'hard end' of what we do."
Prue says the value of internal versus external evaluation is a perennial debate in the evaluation profession, and she comes down firmly on the side of internal evaluation. "In our kind of work, there are benefits in doing internal evaluation rather than relying only on external contractors." She lists the strengths of internal evaluation: first, internal evaluators are knowledgeable in terms of the policy and concepts behind what is being achieved and secondly internal evaluators "can get closer to how things are really implemented".
A third factor is the opportunity for dialogue throughout the evaluation. "We provide feedback on the conceptual thinking and data, while those implementing the programme can give us feedback on the reality behind the figures."
Disadvantages of internal evaluation include the possibility of "capture" and lack of objectivity. "This is a risk we counter through evaluation being a professional discipline with a methodology. If we understand the theoretical assumptions and if there is a sound methodological grounding, this guards against being 'captured'."
Prue has worked in the area of government research and evaluation all her working life. After graduating with degrees in anthropology and English literature, she worked with the Ministry of Justice for 13 years, followed by shorter stints with the Law Commission and what was then the Ministry of Māori Affairs, before moving to Inland Revenue. She enjoys working in the environment of a big department that combines both policy and operations. "There is a wonderful blending of the concepts and the actual practice. And that's what evaluation is about – seeing what happens to policy in practice."
