A Labour government would create a powerful Covid corruption commissioner to help recoup billions of pounds of taxpayers’ money that has been lost to waste, fraud and flawed contracts during the pandemic, Rachel Reeves is to announce.
The new commissioner would be given the power to bring together public agencies including HMRC, the Serious Fraud Office and the National Crime Agency to pursue at least £2.6bn of “lost” public funds. They would examine contracts line by line and would have to update parliament on their progress in clawing back money.
An estimated £7.2bn was lost in fraud from Covid support schemes including from business loans and grants, furlough and “eat out to help out”, although the figure could be as high as £10.8bn, according to the House of Commons library. Labour believes a lower estimate of £4.7bn could be achieved if losses are contained.
In her conference speech in Liverpool on Monday, Reeves will announce that Labour would review sentencing on fraud and corruption conducted against UK public services, as well as reform public procurement rules to include a strong “debarment and exclusion” regime for those complicit in fraud against the state.
There would also be more robust oversight of public grant and loan schemes in future with counter-fraud experts, data management and analytics all involved to prevent financial losses.
“The cost to the taxpayer of Covid fraud is estimated at £7.2bn with every one of those cheques signed by Rishi Sunak as chancellor and yet just 2% of fraudulent Covid grants have been recovered,” Reeves will say.
“We will appoint a Covid corruption commissioner equipped with the powers they need and the mandate to do what it takes to chase those who have ripped off the taxpayer, taking them to court and clawing back every penny of taxpayers money that they can. That money belongs in our NHS, it belongs in our schools, it belongs in our police and conference – we want that money back.”
During the pandemic the government suspended its usual procurement processes and introduced a highly secretive VIP “fast lane” for procurement of goods including protective equipment. It later wrote off £8.7bn it had spent on defective or overpriced PPE.
after newsletter promotion
Jolyon Maugham, the founder of the Good Law Project campaign group, said: “The scale of PPE waste and corruption is sickening: over £10bn lost; more than four in every five pounds spent. If you’re serious about looking after public money – yours and mine – you want those billions back. Recovering them starts with political will. Until now that has been sorely lacking – so this is a very positive development.”
