Billions of pounds lost due to fraudulent activities and errors related to the Covid pandemic are unlikely to be recovered, according to a critical report. The Covid Counter Fraud Commissioner, Tom Hayhoe, uncovered a staggering £10.9 billion that was misappropriated from taxpayers during the pandemic. This loss stemmed from fraudulent schemes such as ‘bounce-back’ loans, the Eat Out to Help Out program, and various one-off grants.
Although £1.8 billion has been reclaimed, the report indicated that a significant portion of the missing funds may never be retrieved. The total amount lost is nearly equivalent to the annual cost of operating the UK’s justice system and could have covered free school meals for eligible children for eight years.
Hayhoe criticized the government for neglecting the risk of fraud while implementing measures to combat the virus. Insufficient attention to fraud vulnerabilities led to significant financial losses for taxpayers. The report highlighted issues like weak accountability, poor data quality, and inadequate contracting practices that contributed to the widespread waste.
Efforts to recover misappropriated funds have become more challenging over time due to evidence degradation, fund relocation, backlog in the justice system, and changes in government personnel. Despite these hurdles, Hayhoe emphasized the importance of continuing recovery endeavors, citing instances where substantial amounts could still be reclaimed.
The report underscored the necessity for implementing robust anti-fraud measures to prevent exploitation during crises. It emphasized the need for vigilance against fraudulent activities and stressed that fraudsters should not consider their actions victimless. Chancellor Rachel Reeves condemned the lax approach to fraud prevention, highlighting the significant financial impact on public services and the economy.
In response to the rampant fraud, a task force was established to pursue Covid-related offenders, with the authority to levy fines equivalent to the owed amount. Fraudulent claimants were given a deadline to voluntarily return misappropriated funds by December.