UK revenue department accused of 'inaction' to recoup billions in COVID fraud
The UK’s Revenue and Customs Department (HMRC) is accused of “ignorance and inaction” for recouping £6bn fraudulent COVID-19 support payments, drawing an angry backlash from taxpayers and lawmakers.
In a statement on Friday, the Public Accounts Committee said the government risked “rewarding the unscrupulous,” which would ultimately add to the cost of living crisis engulfing the country.
The PAC, which scrutinizes state spending, also accused the British officials of being “soft on fraud.”
The UK government’s coronavirus Job Retention Scheme, widely known as furlough, cost 70 billion pounds in taxpayers’ money to pay one third of British workers' wages at the time of the pandemic.
But the government has since found that some employers claimed money for workers who did not exist, and others took cash while their staff continued working.
In a series of criticisms targeted at the HMRC, the PAC said that the department’s plans to recover fraudulent payments were “unambitious” and the customer service at the tax authority had “collapsed.”
The group of leading MPs in the PAC accused the HMRC department of not doing enough to crack down on tax avoidance.
Citing the HMRC’s estimate that it might recover £2bn of £6bn in fraudulent claims, PAC Chair Dame Meg Hillier said, “The level of fraud and error in furlough that employers will get away with is a real concern.”
“What signal does it send when HMRC rolls over on billions of pounds of fraud and error directly related to COVID-19 support packages?” she asked.
“Every taxpayers’ pound lost to a fraudster will lead to honest ordinary people feeling the post-pandemic pinch harder and harder,” Hillier added.
Meanwhile, shadow chancellor Rachel Reeves described the government’s inaction as “damning.”
“It should be a source of enduring shame to the chancellor that he has so casually written off billions in taxpayers’ money that is now in the hand of criminals and gangs,” Reeves said.
The development comes after Theodore Agnew, a junior minister who was responsible for government efforts to counter fraud, resigned last month, saying that the oversight of a separate business loan program by the government had been “nothing less than woeful.” Agnew also accused the government of making “schoolboy errors.”
During the recent weeks, the UK government has been tussling with a series of challenges including the Northern Ireland crisis and partygate scandal.
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