Source · Select Committees · Public Accounts Committee
Recommendation 10
10
We asked the Department about its long-term plans for the loan book, as our experience...
Conclusion
We asked the Department about its long-term plans for the loan book, as our experience has been that Government has generally had issues at times managing loan books.24 The Accounting Officer confirmed her accountability for the fund’s loans but said it was too early to say what the plans were for long-term management and could not give any commitments about whether or not the Government would sell on the loan book.25 We asked the Department whether, given the scale of COVID-19 loans across Government, it had learned lessons from other Departments about managing its loan book. It told us it regarded the scale of COVID loans in the fund as “a mere minnow” but acknowledged it was a lot of money for the sector, and said that as ACE had close and long- term relationships with many of the organisations that had received loans it considered this was unusual compared to other loan schemes rolled out across Government. Nonetheless it said it wanted to follow excellent practice and was very keen to learn from good practice in other Departments about how they were handling loans.26 Acting quickly to provide funding and applicants’ experiences
Government Response
Not Addressed
HM Government
Not Addressed
2: PAC recommendation: In its Treasury Minute response, the Department should set out how it will make sure it has the resources in place to take on the new responsibilities for managing loans, and how it has drawn on learning from across government about managing the operation and future risks of its loan book commitments, including risks of organisations defaulting. 2.1 The government agrees with the Committee’s recommendation. Target implementation date: December 2021 2.2 DCMS officials are working carefully in order to establish the most appropriate mechanism for managing the loan book over the long term, factoring in best practice from across government and from industry experts. As a novel form of government investment, it is clear that sufficient resources must be provided to whomever ultimately manages the loan book - and that the appropriate structures underpinned by relevant expertise will be needed to reduce risks of default. 2.3 The Committee has asked for further updates on the Culture Recovery Fund in December 2021, and the department will include further information on this at that point.