£11.8bn lost to Covid support scheme fraud and errors

New figures from the House of Commons library show that fraud and errors involving coronavirus support schemes such as furlough and Bounce Back Loans cost taxpayers an estimated £11.8 billion. This is almost twice the amount lost as a result of Black Wednesday when Britain crashed out of the Exchange Rate Mechanism in 1992.

Martin Cheek, managing director at SmartSearch, commented: “It is disgraceful that such a vast amount of public money has been lost to preventable fraud.

“While it was essential that loans were made available swiftly so businesses could be supported after the outbreak of the pandemic, that does not justify a failure to conduct due diligence. Digital fraud checking could have been used to review within seconds the validity of claims for Bounce Back Loans and other support.

“This ineffective stewardship of taxpayers’ money is likely to have long-term implications for public finances, and has underlined the need for effective checks to be put in place when allocating public money.”