Covid-19: Financial Support Schemes

Lord Forsyth of Drumlean Excerpts

Wednesday 6th April 2022 Lords Chamber

[Baroness Penn (Con)]

My Lords, I would like to pay tribute to my noble friend’s hard work in this area, but I disagree with him about the seriousness with which the Government take this issue. I was pleased to note that he welcomed the announcement in the Spring Statement of the funding to deliver the public sector fraud authority, about which I have already spoken to noble Lords.

[Lord Forsyth of Drumlean (Con)]

My Lords, I declare my interest as a chairman of a bank. Can I ask my noble friend: if the banks did not do elementary due diligence, such as checking that a company was trading or checking a national insurance number, why on earth should the Government pay out on the guarantee? Should it not fall on the banks for not having done their job properly?

[Baroness Penn (Con)]

My noble friend is correct that, while there were reduced checks in place on bounce-back loans, there was still a requirement for lenders to make checks, and we are quite clear in the terms of the loan guarantees that, if it appears that those checks were not made, then those businesses do not have a claim against their guarantee.