Source · Select Committees · Public Accounts Committee
Recommendation 12
12
We have found in our reports on the government’s response to the COVID-19 pandemic, that...
Conclusion
We have found in our reports on the government’s response to the COVID-19 pandemic, that the need to act at speed can reduce transparency and increase the risk of fraud and error. In our report examining Government procurement and the supply of Personal Protective Equipment, we found that Government had faced significant challenges in having to work at pace, using emergency procurement procedures in a competitive international market. But its failure to be transparent about decisions, publish contracts in a timely manage or maintain proper records of key decision left if open to accusation of poor value for money, conflicts of interest and preferential treatment of some suppliers. While levels of fraud were low, the costs could run into millions of pounds.43 Similarly, in our report on the Bounce Back Loan Scheme, we concluded that shortcoming in the Scheme’s design had exposed the taxpayer to potentially significant losses and that plans to manage risks from the taxpayer from fraud and borrowers who were unable to replay loans were woefully under-developed. Government had been prepared to accept a higher level of risk to ensure that loans were available to businesses as quickly as possible. The 36 C&AG’s Report, paras 1.11–1.18 37 Qq 70, 74 38 C&AG’s Report, para 1.20 39 Qq 78, 80 40 Q 84 41 Q 85 42 Qq 78, 80, 85–86 43 Public Accounts Committee, COVID-19: Government procurement and the supply of Personal Protective Equipment, Forty Second Report of Session 2019–21, HC 928, 10 February 2021 COVID-19: Government Support for Charities 13 Department for Business, Energy and Industrial Strategy estimated that potential losses from fraud and credit risks were between £15 billion and £26 billion, and could be even higher and the estimate was highly uncertain.44
Government Response
Acknowledged
HM Government
Acknowledged
The government agrees with the Committee’s recommendation. Recommendation implemented 2.2 DCMS agrees that appropriate records of decisions, especially in relation to funding, should always be kept. In this instance, as the DCMS Permanent Secretary confirmed in a letter dated 14 May 2021 to the Committee, she was satisfied that civil servants and special advisers at all times followed the Civil Service Code and Code of Conduct for Special Advisers in the distribution of the COVID-19 Charities Funding and that the decisions on funding were made by ministers in the proper way based on appropriately recorded written submissions from civil servants to junior ministers and the Secretary of State. All such submissions and the responses from ministers are recorded in the DCMS IT system. 2.3 The same letter set out the detailed processes involved confirming the distinction between impartial advice from civil servants and the political advice offered by special advisers. The process was that, while special advisers were present at a meeting where proposed allocations were being discussed, those meetings were chaired by a civil servant at Director General level and that the bids being considered by officials for recommendation to 21 ministers at the time of the meeting were all eventually recommended to ministers. These were the only bids recommended. No bids were added to or removed from the list of recommendations as a result of the meeting or after that for any other reason. For a small number of bids, the monetary value of the award being recommended was adjusted between the meeting and the official submissions to ministers. The decision to do so was made by DCMS civil servants who were satisfied that the recommendations were all evidence-based and value for money. 2.4 As the Committee acknowledges, the department was working at pace in exceptional circumstances and continues to reflect on all lessons learned. While DCMS is confident that proper processes and procedures were followed in this case, the department continues to remind civil servants about their duties under the Civil Service Code and Code of Conduct for Special Advisers as well as the importance of appropriate record keeping both as part of the induction programme for new staff and in regular briefings cascaded to staff across the department.