Covid-19: Financial Support Schemes

Lord Sikka Excerpts

Wednesday 6th April 2022 Lords Chamber

Asked by

[Lord Sikka]

To ask Her Majesty’s Government what assessment they have made of the possible losses arising from fraudulent use of (1) furlough support, (2) the Bounce Back Loan Scheme, and (3) other COVID-19-related financial support schemes.

[Baroness Penn (Con)]

The Government take fraud extremely seriously and have been consistently clear that fraud is never acceptable. The latest estimates are set out in the department’s 2020-21 annual report and accounts. Updated estimates will be published in the next few months in the 2021-22 annual report and accounts. The Government are investing in tackling fraud and error across these schemes. Most recently, the Chancellor announced an additional £48.8 million for a new package of measures to tackle fraud.

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[Lord Sikka (Lab)]

My Lords, under this Government, we now have the highest level of taxation and fraud. Annual fraud is between £29 billion and £52 billion. Last year, the government counter-fraud function classified £219 billion of the £387 billion of Covid-related financial support as “high or very high” fraud risk. Will the Minister tell the House how much is now classified as high or very high fraud risk and when an independent investigation into the Government’s failure to apply proper due diligence checks will commence?

[Baroness Penn (Con)]

My Lords, as I said to the noble Lord, updated estimates from the Government will come out in this year’s annual accounts. However, I have two points to make to the noble Lord. The first is on the scale of support that this Government put in place during the Covid-19 pandemic, which safeguarded 12 million jobs and more than 1 million businesses, which might not otherwise be here. Secondly, I referred in my Answer to the extra money for a new package of measures to tackle fraud. That includes setting up a new public sector fraud authority. One of the roles that it will focus on is understanding and measuring the losses around the Covid-19 spending, so that we can learn lessons for the future.