Covid bounce back loan scheme comes under fire
The head of an influential group of MPs has accused the Government of using the speed of its response to the pandemic to excuse a "disregard" to how much it will cost the taxpayer.
Meg Hillier said her fellow members on the Public Accounts Committee were "unpleasantly surprised" to learn the Government had “learned little" from the 2008 banking crisis.
The committee, which Dame Meg chairs, said the Department for Business Energy & Industrial Strategy (Beis) was "complacent" in preventing fraud in the £47bn paid out in the Bounce Bank Loan Scheme, which funnelled billions to small companies.
The loans came from the banks but, if companies were unable to pay back, the Government promised it would fully reimburse lenders.
The Committee said the Government is relying too heavily on banks to get the money back and not incentivising them to pursue potentially fraudulent loan takers.
Dame Meg: "With weary inevitability we see a Government department using the speed and scale of its response to the pandemic as an excuse for complacent disregard for the cost to the taxpayer.
"More than two years on, Beis has no long-term plans to chase overdue debt and is not focused on lower-level fraudsters who may well just walk away with billions of taxpayers' money."
She added: "The Committee was unpleasantly surprised to find how little Government learned from the 2008 banking crisis.
"Beis must commit now to identifying what anti-fraud measures are needed at the start of any new emergency scheme so the taxpayer is better protected in future.”