COVID-19: Government ‘too slow’ to recover taxpayer money lost to fraud

The government is still being “too slow” to recover taxpayer money lost to fraud and error over the pandemic, MPs have said.

The cross-party Public Accounts Committee (PAC) also said Whitehall needs a “step change” in its approach to risk in order to prevent a similar “panic response” in the future.

In a wide-ranging report, the group laid bare a number of “repeated problems”.

Total fraud and error across COVID employment schemes delivered by HMRC was an estimated £4.5bn, of which the department expects to recoup just £1.1bn, PAC said.

“Some increase in fraud and error was an inevitable short-term consequence of providing support quickly, but government is being too slow to recover taxpayer pounds lost,” the report said.

“Whitehall departments have an opportunity to do better by the taxpayer by prioritising work to tackle current levels of fraud and error; improving how they measure fraud and error so we can be clearer about the extent of the problem and measures to tackle it; and planning and implementing better fraud and error safeguards.”

And the committee also found the Department of Health and Social Care wasted an “extraordinary” £14.9bn on PPE and related COVID expenditure across the last two years.

“No-one could predict the COVID-19 pandemic, but we could have been better prepared,” the report added.

More on PPE:
COVID-19: PPE storage still costs taxpayers £580,000 a day, new figures reveal

“The scale of the losses incurred in a panic response on issues such as PPE procurement are documented in this report. We need to learn the lesson that there is always unpredictability.”

A Government spokesperson said: “In the last two years, we have recovered more than £3.1bn of fraud losses, including within COVID-19 schemes, and as the report acknowledges, we have already made significant progress by establishing the Public Sector Fraud Authority.

“However, we are not complacent, which is why we are expanding the Government’s Counter-Fraud Profession, developing new technologies and boosting skills and training to further protect the public purse.”

Angela Rayner, Labour’s deputy leader, said: “This is a damning indictment of eye-watering Tory waste, with Rishi Sunak writing off billions in taxpayers’ money lost to COVID fraud after ignoring basic checks and warnings.”