THE Government's controversial tax credit system has come under fresh attack, after new figures showed yet more multi-billion pound overpayments.

York families caught up in the fiasco said the latest shocking statistics came as "no surprise".

New figures show a total of £1.8 billion in tax credits was overpaid nationally in 2004/05, in 1.96 million claims.

Clawing back the money has caused chaos and misery for countless working families.

At City of York Council, Coun Cederig Jamieson-Ball, the authority's spokesman on tax credit issues, claimed 5,500 families in the city were still being forced to pay back more than £4.3 million in overpayments. He has called for an overhaul in the way credits are awarded.

Liberal Democrat spokesman David Laws has called for Paymaster General Dawn Primarolo to be sacked.

Julie Acaster has been through her own tax credits nightmare. She had just finished paying back £1,500 in overpayments when she received a notice saying she owed another £550.

Working mum Julie, of Shipton-by-Beningbrough, now believes she finally has the situation under control.

She said: "It's taken three years of absolute hell, including countless phone calls, to get this sorted out.

"Almost £2 billion is a lot of money, and it is affecting thousands of family in the York area alone. When this tax credit system first came out it was a fantastic idea, but it just isn't working and someone should take responsibility for that."

Coun Jamieson-Ball said: "The system of tax credits is unbelievably complicated it is time an easier and more transparent system was introduced."

York MP Hugh Bayley said: "The net overpayment of over £1 billion a year is far too high. The Government must make the system more accurate but, unlike the Lib Dems, I don't want to throw the baby out with the bathwater.

"Tax credits put £15,500 million a year into the pockets of low and middle income families. They have done a huge amount to reduce poverty and increase living standards for ordinary families and the system should be kept.

"Many of the overpayments would be reduced if the families reported changes to their earned income more quickly."

Mr Bayley stepped into one family's two-year tax credit fiasco last month.

Gerard and Tracey Bergin, who live off Hamilton Drive, York, found themselves caught up in a financial nightmare after HM Revenue and Customs tried to claw back alleged overpayments dating back to 2004/05.

Mr Bayley wrote to the Paymaster General asking her to investigate the case.

Tracey said today: "We have been through the whole scale of emotions understanding, cross, upset, empty. I am beginning to think we will never resolve it completely.

"Demanding people resign is often a knee-jerk reaction but, at the end of the day, someone has to be held responsible."

In York, Coun Jamieson-Ball said there were a further 2,700 households who were underpaid a total of £1.7 million.

Lone parent's £3,300 tax credit debt nightmare

A SINGLE parent from Selby has been told she owes £3,300 in tax credits.

Sheena Shift, 33, has described her experience with HM Revenue and Customs as like "banging her head against a brick wall" and has sought the help of her local MP and Citizens Advice Bureau.

She said that she had repeatedly informed Revenue and Customs about her changing circumstances, but to no avail.

The single mother first filled in the forms to claim back the credits in July 2003 after the birth of her son, Harry, in May that year.

She returned to work full-time as a product manager in October, taking redundancy in March 2005. She later took a part-time administrative assistant job in June of that year.

"There has been a catalogue of errors, it has been a nightmare from the beginning," she said.

"In the first year they managed to pay me the childcare element of Working Tax Credit when I was not back at work.

"There was a period when I was working full-time when my payments were reduced from £450 a month to £2.74, and after that it was just nothing."