Business: Coronavirus

(asked on 26th January 2022) - View Source

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what steps his Department is taking to tackle fraud in the covid-19 business support schemes.


Answered by
John Glen Portrait
John Glen
Paymaster General and Minister for the Cabinet Office
This question was answered on 31st January 2022

The Government has consistently stated that fraud is unacceptable, and we are taking action on multiple fronts to recover money lost to error and fraud and, where necessary, take legal action on those who have sought to exploit the Covid support schemes. It was right to establish the schemes quickly and in a way that they could be accessed easily by the millions who needed support.

Given the unprecedented efforts that the Government have made to protect jobs and livelihoods during this pandemic, it would have been impossible to prevent all related fraud. However, we have taken reasonable steps, and will continue to do so, to deflect and combat that fraud, and we will continue to be vigilant.

Robust measures were put in place to control error and fraud in the key COVID-19 support schemes from their inception. For instance, to minimise the risk of fraud and error and unverified claims, the Coronavirus Job Retention Scheme and Self-Employment Income Support Scheme were designed in a way to prevent ineligible claims being made up front, and made payments for employees and businesses using existing data held on HMRC’s systems. That included cut-off dates around scheme eligibility and the need for customers to be registered for pay-as-you-earn online or self-assessment.

To further bolster anti-fraud measures on HMRC-delivered covid support schemes, at the Spring Budget last year, the Government invested more than £100 million in a Taxpayer Protection Taskforce of more than 1,200 HMRC staff to combat Covid-related fraud. This Taskforce is expected to recover between £800 million and £1 billion from fraudulent or incorrect payments during 2021-22 and 2022-23. In addition, HMRC has so far stopped or recovered £743 million of overclaimed grants in 2020/21.

Regarding the Bounce Back Loan Scheme, the Government continues to work closely with the British Business Bank, lenders and enforcement agencies to tackle fraud and to recover as many fraudulent loans as possible. This is on top of the £2.2 billion worth of fraudulent applications that were prevented by upfront checks.

In addition, as part of the Spring Budget last year, we announced plans to significantly strengthen enforcement activity against fraudulent Bounce Back Loans, including new powers for the Insolvency Service to tackle rogue directors and investing in the National Investigation Service to investigate serious fraud.

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