Minister Who Resigned Over Covid Loans Says He “Wasn’t Aware Of Full Horror” Of Fraud Until Much Later
Lord Agnew quit his role as a Treasury minister at the despatch box in January (Alamy)
The former Treasury minister who resigned over the government’s failure to tackle fraud in the Covid loan schemes has called on the board of the British Business Bank to resign.
Lord Agnew, who resigned at the despatch box earlier this year, said he wasn’t aware “of the full horror until much later” amid reports that billions of pounds fraudulently claimed during the pandemic was being written off.
Giving evidence to Business, Energy and Industrial Strategy (BEIS) select committee, the peer said “if the will was there” money could still be recovered, but pleaded with MPs to try and force the government to do so.
“We all heard anecdotally of sports cars being bought up and down the county by recipients of business bank loans. That is a fraud,” he said.
Lord Agnew said the British Business Bank, which was given the task of running a number of the schemes announced by Chancellor Rishi Sunak in 2020 to help firms cope with the impact of the Covid pandemic, has “presided over one of the most colossal cock-ups in recent government management”.
He told the cross-party committee their entire board “should be sacked”, accusing them of “doubling down on their defensiveness” and trying to “defend the flaws of the last two years”.
The bank has granted around £75 billion in government-guaranteed loans, with £45 billion of that in the ‘bounce back’ scheme.
Last year the National Audit Office was critical of a failure to implement measures to prevent people exploiting the schemes, and in January it was claimed £4.3 billion in fraudulent claims would not be pursued.
Sunak said although people were "absolutely right to be" concerned about illegally obtained funds, he said he was not “ignoring it, and I'm definitely not writing it off”.
But Lord Agnew, who was the minister for counter fraud, dramatically resigned from his role in protest at how the government has failed to tackle the issue.
“My deeply held conviction is the current state of affairs is not acceptable,” he told the Chamber at the time.
Today he said a continued lack of data provided by the British Business Bank, or from the department for business, energy and industrial strategy which oversees it, means “we haven’t a clue” how much money had been lost to fraud.
“We’re all blind and we shouldn’t be blind,” he added, saying that the fraud analytics were “so weak” when the pandemic began.
Agnew accused the “machine” in government of failing to publish these analytics due to “paranoid risk-aversion combined with ignorance”.
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