Government branded ‘dangerously flat-footed’ in recovering £1.9bn of Covid loan losses
The government was warned by a committee, which was warned by the deputies, in its efforts to recover about £ 2 billion in the estimated taxpayer losses from the Covid-19 Bounce back credit plan.
The Public Accounts Committee (PAC) criticized the lack of incentives for the rescue of the loans to continue the rescue of these funds and emphasized an important gap under the supervision of the plan.
Introduced in the early days of the Pandema, the Bounce Back Credit program is designed to provide rapid financial support to businesses struggling with forced closing and demand for falling.
He offered loans up to £ 50,000 per work, most of the UK was quickly available by renunciation of standard credit and purchase checks.
However, the Ministry of Business and Trade (DBT) estimates that the total losses due to fraud in the plan will reach at least £ 1.9 billion, which is considered to be higher because all fraudulent cases are not yet defined.
Although it has been recycled by about £ 130 million so far, the DBT admits how much of it is related to fraudulent loans.
PAC’s sharp warning underlines the ongoing concerns about the large amounts of public currency lost to the fraud and the slow response of the government to keep taking into account the responsible.
The government guaranteed to cover damages caused by unpaid loans when the plan started by the loans.
Nevertheless, he withdrew the support of the loan on the loan, which he felt that he did not do everything he had to do – the bill rather than the taxpayers of banks.
Starling Bank at the beginning of this month, said he agreed to remove the government guarantee for a group of potential problems and led him to put aside £ 28 million.
However, PAC said that wider warranty is a lack of incentives for banks’ taxpayers to recover their money.
Committee President Sir Geoffrey Cliftton-Brown criticized “passivity ında in the government’s approach.
“The DBT could not tell us if the small part of the regained total was related to fraud, even if it was related to fraud,” he said.
“Indeed, relying on state -backed lenders to save losses that lack any incentives to follow lost funds has been a dangerous approach to a flat -foot approach.
“Since bankruptcy service assumes the responsibility of applicable cases, we look forward to hearing how others have failed.”
DBT approached for comment.
