TECHNOLOGY
THE DARK AGES
WEREN ’ T THAT
LONG AGO
Don Macarthur MA PhD FCIPP, CIPP Payroll Assurance Scheme (PAS) assessor and former HM Revenue and Customs (HMRC) official, discusses how technology has changed the face of payroll over time
I guess we’ve all become accustomed to taking lots of things which weren’t even dreamt of a few decades ago for granted. It’s all too easy to forget that so much of what’s familiar to us today was unknown in our youth and certainly in our parents’ youth. The ready availability of food from around the world, for instance, or the opportunity to holiday anywhere you want or the existence of hundreds of television channels to choose from: just a few examples of the many I could have listed. The great payroll transformation Of course, the greatest advances have been in the world of technology. Payroll, like so many other industries, has been totally transformed by the computer. But it may be surprising to recall just how recently some of this began. OK, Lyons Corner Houses began using software to process their payroll as far back as 1954, but even large companies were mostly keeping paper records for a long time after that. And it wasn’t until the 1990s that some of the larger payroll bureaux and employers were able to work with the then
Inland Revenue to allow the first annual employer returns to be sent electronically via electronic data interchange. It took a little longer to enable online filing via the internet, and thus to open up the possibility of online filing for smaller employers. Even then the cost of investing in the necessary software for this purpose was viewed as prohibitive for many of the smallest payrolls, until the Revenue introduced a free CD-ROM-based filing “The introduction of real time information to enable the same data to be transmitted every pay day caused grumbles to start with but is now well accepted”
package (the precursor of today’s basic pay as you earn (PAYE) tools), to fill this gap for employers with up to ten employees. And the size constraints of technology meant that government departments struggled to offer the sort of nationwide service needed to respond to an increasingly mobile workforce. I can still remember the first installation of individual computers on the desks of pay as you earn (PAYE) staff in local tax offices in 1983, which at the time seemed an incredible advance. But the associated software – called Computerisation of PAYE, or COP for short – was necessarily managed through 13 regional databases, and reporting data across regional boundaries was slow, clunky and inevitably error-prone. It took quite a few years before these regional databases could be merged into a single national one covering the whole of the UK.
The frustrations of payroll professionals
When I was first appointed to manage employer engagement for the Inland Revenue in 2000, I learnt very quickly
| Professional in Payroll, Pensions and Reward | October 2023 | Issue 94 52
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