Covid-19: Financial Support

James Murray Excerpts

Thursday 15th January 2026 Commons Chamber

[The Chief Secretary to the Treasury (James Murray)]

I, too, congratulate the hon. Member for Stratford-on-Avon (Manuela Perteghella) on securing this debate. I thank hon. Members from both sides of the House for their powerful contributions. Although much of the debate has rightly focused on the detail of the financial support made available by the then Government during the pandemic, we have also heard many deeply personal stories about businesses and individuals who were directly affected.

In two months’ time, the country will come together to mark the sixth anniversary of the start of the pandemic. That will be an opportunity for us all to remember and reflect, and to pay tribute to all those who died, whose loss is still so keenly felt in all our constituencies. The pandemic cost over 227,000 lives in our country, and I know that loss and grief are still felt by families whose loved ones were lost during that difficult period.

As the hon. Member for Richmond Park (Sarah Olney) said, reflecting on the pandemic is also a moment to express our gratitude, once again, to all those who worked throughout the pandemic to provide vital and, in many cases, lifesaving services to all of us across the country. It is also a moment to recommit to learning the lessons of what happened during that time, so that we are better prepared for future crises. The Government are committed to learning those lessons and doing all we can to protect businesses and individuals across Britain in future.

As well as having a huge impact on the lives of people and their families across the country, as we have heard today, the pandemic was a huge economic shock. GDP fell by a record 19.4% and thousands of businesses faced closure, so it was necessary to support businesses and individuals affected. We supported putting in place the measures mentioned by the shadow Minister, the hon. Member for North West Norfolk (James Wild), including the coronavirus job retention scheme, the self-employment income support scheme, and various business grants and Government-backed loan guarantees. It is right, however, that we as a country now reflect on how those schemes were implemented by the Government of the day.

As we have heard from many hon. Members, a number of people experienced genuine hardship and distress because they were excluded from the available schemes. Many of those experiences have been described powerfully in today’s debate, including by the hon. Member for Stratford-on-Avon in her opening speech and by my hon. Friend the Member for Montgomeryshire and Glyndŵr (Steve Witherden). We also heard a number of other stories about individuals and businesses across the country from my hon. Friend the Member for Truro and Falmouth (Jayne Kirkham), the hon. Member for Ely and East Cambridgeshire (Charlotte Cane), and my hon. Friend the Member for Mid Cheshire (Andrew Cooper), who also spoke about the significance of economic resilience and preparedness for the future—an important topic that I will return to in a moment.

We also heard from the hon. Members for Wimbledon (Mr Kohler) and for Dewsbury and Batley (Iqbal Mohamed), and my hon. Friend the Member for Falkirk (Euan Stainbank), who spoke about the impact of the pandemic on young people, which has had a lasting effect, as we are all keenly aware. The hon. Members for Didcot and Wantage (Olly Glover) and for Mid Dunbartonshire (Susan Murray) also spoke about their affected businesses and constituents. One of the themes of those contributions was about what we as a country are doing to prepare for the future, to ensure that if a similar crisis happened again, we would be better prepared. As a Government, we are considering how we might better target and reach excluded groups in future, including through better real-time data collection.

As hon. Members know, the official covid-19 public inquiry is considering how future emergency schemes could be better tailored to the modern labour market. The inquiry recently held public hearings focused on economic support for people and businesses during the pandemic, and it will publish its final report in due course. The Government, including the Treasury, fully participated in those hearings and provided a substantial amount of evidence. We will carefully study and consider any recommendations, mindful of our responsibility to vulnerable groups and our commitment to value for money.

As hon. Members have also made clear, no assessment of the previous Government’s record during the pandemic can ignore the fact that billions of pounds of taxpayers’ money was lost to fraud. That was a failure of monumental proportions, and we are all continuing to pay the price. That is why, on taking office, we took action to recoup the money owed, including by appointing Tom Hayhoe as the covid counter-fraud commissioner. In December he published his report, and the findings are shocking.

According to the commissioner, covid fraud cost the taxpayer a staggering £10.9 billion—that is enough to fund daily free school meals for the UK’s 2.7 million eligible children for eight years. Of course, we recognise that our predecessors in government were responding to a crisis, the nature of which demanded acting at speed, but the cynical exploitation of pandemic support was foreseeable.

Last year, an arrest was made following an HMRC investigation into a company, Luxe Lifestyle, which was awarded a £25 million PPE contract, having been referred to the procurement VIP lane by a Conservative Minister and a party chairman. The company won that contract despite having no employees, no assets, no turnover and £9,000 of debt. While Luxe Lifestyle did end up supplying some items, they were all inadequate and unusable. That is just one example. It does not begin to scratch the surface of covid fraud, but we have heard no apology today from the Conservatives for their actions—no apology to this House, and no apology to the British people who have been left to pick up the bill.

We cannot allow this ever to happen again. That is why the Government introduced tougher sanction powers in the Public Authorities (Fraud, Error and Recovery) Act 2025 to help recover stolen funds, and why we have rolled out specialist fraud recovery teams to track down suspected fraudsters and recover taxpayer cash. Since coming to office, the Government have recouped almost £400 million paid in error or that was obtained illegally through covid fraud. As the Chancellor has made clear, this fraud is a fraud against the British people, and we will leave no stone unturned, leave no question unasked, and leave no fraudster unchallenged until we have cleared up the mess we inherited.

While we work to fix those problems, we are also turning towards the future, making sure our country is well prepared to face future crises. Much has been learned already from the covid-19 pandemic, but the scale of the economic emergency facing the country nearly six years ago underlines the need to continue embedding these learnings into the Government’s systems and processes. As I have already set out, we have taken tough action to track down the fraudsters who profited on the previous Government’s watch. We are improving and enhancing the Government’s analytical and modelling capabilities, to ensure that we can better target support schemes in future. We have launched the National Situation Centre, enabling us to identify and plan for a range of risks and improve our crisis response.

We have conducted, through Exercise Pegasus, the largest cross-Government pandemic simulation in British history, helping to make sure we are better prepared than before, that our plans are battle-tested, and that we are ready to adapt. As the official covid-19 inquiry draws to a close, we stand ready to study any recommendations and to take action where needed.

The economic implications of the covid-19 pandemic for this country were profound. In response to this unprecedented crisis, it was of course necessary to act quickly for our economy and for our communities. But we know that mistakes were made, and the British people were defrauded to the tune of over £10 billion. That is money that should have been spent on schools and hospitals but which has instead gone into the pockets of fraudsters and criminals. There will also undoubtably be wider lessons to draw from the design of support schemes and the impact those schemes had on various groups across the economy.

As a Government, we will continue to enhance our resilience to future shocks. We have set to work on that since the election, and our efforts will intensify after the official covid-19 inquiry publishes its final report. We will do whatever is necessary to build a safer and more secure country for the future. I will end by again thanking all hon. Members for sharing the experiences of their local businesses and individual constituents in the debate.