The UK government has been complacent when it comes to offering £ 47 billion ($ 59 billion) loans to companies affected by the COVID-19 pandemic.
The Public Accounting Committee In a report released on April 27, the Department for Business, Energy and Industry Strategy (BEIS) stated that it was “indifferent” to preventing fraud in the Bounce Back Loan Scheme (BBLS).
Labor Party lawmaker Dame Meg Hillier, who chairs the committee, said, “The government sector is using the speed and scale of its response to a pandemic as an excuse to carelessly ignore taxpayers’ costs. It is inevitable. “
She said the Commission was “unpleasantly surprised” at how “little” the government had learned from the 2008 banking crisis.
Approximately 1.5 million companies received a total of £ 47 billion in bank loans and the government undertook the loans.
It could take 10 years before the number of companies defaulting on loans is revealed, but BEIS estimates that losses could be up to £ 17 billion ($ 21 billion).
In January, Sir Agnew, Minister of Fraud Prevention, resigned from the government’s treatment of “boys” on fraud issues, saying BBLS surveillance was “disastrous.”
In a report by the Public Accounting Commission, the Minister said: The Commission was unpleasantly surprised to learn that the government had learned little from the banking crisis of 2008. And even now, I’m not entirely sure that these difficult lessons will be incorporated into future emergencies. “
According to the report, the government was overly dependent on the bank to check the borrower’s solvency when the bank itself was paid, regardless of whether the customer defaulted.
The Commission said that BBLS can only be considered successful if it helps the SMEs survive when they may have been established, but “reliable data to compare business recovery. It is difficult to measure the impact of the scheme due to the lack of. We used the scheme in a similar group that we did not use. “
A spokesman for the UK Business Bank said it would announce an early and impact assessment of all COVID-19 emergency lending schemes, including BBLS, in the summer.
A government spokesman said: These schemes have been implemented at unprecedented speed to protect millions of jobs and businesses. If the government did not act swiftly, more businesses would fail and more jobs would be lost. “
PA Media contributed to this report.