£11 Billion* Still Missing from Treasury Coffers from Covid Fraud

With all of Rishi’s recent talk about finding efficiencies in government to balance the books, Guido’s had a look at his Treasury track record during Covid to see how it stacks up. First, Business Bounce Back Loans: according to BEIS figures, as much as £4.9 billion lent to 1.5 million companies was lost to fraud and negligence over the last two years. There are countless reports of fraudsters running away with their £50,000 cheques and splashing out on flashy watches and new cars – and more keep coming. Including cash lost to businesses that ultimately failed, that £3.9 billion figure rises to a potential eye-watering £17 billion. The scale of the problem was so enormous, anti-fraud Minister Lord Agnew actually resigned in disgust at the despatch box earlier this year…

Not to mention the billions flushed away on furlough fraud. The latest government estimates put the total losses there between £3.2 billion to £6.4 billion, with the “most likely” figure sitting at £4.5 billion. Although as National Audit Office head Gareth Davies points out on HMRC’s latest accounts, there’s still “considerable uncertainty”; a previous estimate put the figure as high as a whopping £8 billion…

Guido is aware of a specialist software company that works for the finance industry offering their services to assess credit risk and spot fraud patterns being turned away and told by the Treasury their services were not required. A costly mis-judgement for the taxpayer.

Rishi claimed, as Chancellor, that he wasn’t “ignoring” fraud and he “definitely” wasn’t writing it off. He said as much during the leadership debates, even as Kemi Badenoch insisted he didn’t take it seriously. To prove it, he pointed to the the Public Sector Fraud Authority announced in March – with £25 million of even more new money. That authority only started its investigations this month, and its initial target is to recoup just £180 million in its first year. The amount of money lost to fraud would be equivalent to taking some 5 pence off income tax. Assuming the business loan fraud cost £4.9 billion, and the job retention scheme fraud cost £6.4 billion, at this rate it would take the fraud squad just over half a century to track down the £11.3 billion lost in total…

*UPDATE:  Team Rishi get in touch to make arguments that suggest the figure is at most £7.5 billion and probably much lower than £7.5 billion. That’s still equivalent to some £2,000 per taxpayer…

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