A NEW twist in the saga of liver transplant man Norman Power has exposed the chaos at the heart of the tax credits system.

It came as Mr Power's MP, John Grogan, revealed that tax credit problems had now replaced the Child Support Agency and housing difficulties as the biggest cause of constituents' complaints.

Dozens of people have also contacted The Press after they found themselves in difficulties because of alleged blunders in the tax credit system.

Mr Power, a 56-year-old former pub landlord from Tadcaster, has now been told he does not after all have to repay almost £9,000 in working tax and child tax credits.

HM Revenue and Customs has told Mr Grogan, the Labour MP for Selby, that Norman and his wife, Lesley, were not overpaid such credits in 2003/04, or in 2004/05, as it had originally claimed.

But it still claimed they were overpaid a small amount of child tax credit in 2005/06 because they only informed it last December that their daughter had stopped attending college in September.

However, the couple claimed they had informed the Revenue on several earlier occasions, the first time last May.

And they were equally disturbed by other revelations in the letter from a customer support manager, Anne Cadman.

Firstly, she apologised for delays in replying to the MP, who raised Norman's case with the Revenue after The Press reported in March how he had undergone five operations in less than two years, including a transplant, but was being let down by the welfare state.

She blamed the delay on the volume of letters the Revenue had been receiving at a "busy time".

She said there was a "technical problem" affecting the couple's claim which it was "working hard to fix", and revealed she had arranged for the Revenue to stop sending repayment requests until its records showed the true position, but she could not say how long this would take.

In the meantime, she advised the couple to ignore any letters they had received from the Revenue or "Debt Management and Banking", and asked the MP to pass on her apologies for the problems.

But Mrs Power has now written back to say no one had replied to numerous letters and faxes from her, and was disappointed it had taken action by The Press and her MP for any response.

"If we hadn't received your letter via John Grogan, we would still be unaware of what the situation was, and extremely bombarded with Notice to Pay."

Mr Grogan said tax credits had helped many people on low incomes, but when there were problems - "and there are too many" - people could become entrapped in a battle with bureaucracy.

He said the Government had announced reforms which should help reduce such problems, for example removing the need for changes in tax credits every time their income changed slightly.

Are you suffering from tax credit chaos? Email mike.laycock@ycp.co.uk, or phone 01904 567132.

Updated: 11:14 Friday, May 19, 2006