Recommendation 10

HMRC estimates that total fraud and error across the lifetime of the COVID-support schemes was £4.5 billion, representing 4.6% of the total support provided. This is lower than the estimate HMRC included in its 2020–21 accounts. HMRC has drawn on new data to improve its estimate, from a random enquiry programme, more compliance activity and Self Assessment returns for 2020–21. The estimates are, however, still very uncertain. HMRC said that the most uncertain element was around claims for people working while their employer claimed support for them. Given the speed at which HMRC had to work to get support to individuals and businesses, it said some level of fraud and error was inevitable. HMRC accepted that it needed more timely data on taxpayers’ working patterns at the time the schemes were running, rather than activities after the event that relied on people recalling their working patterns from some time ago. It told us it would look into drawing together its lessons from the schemes to support other parts of government that are tasked with disbursing funds at pace, such as the Household Support Fund.14