Source · Select Committees · Public Accounts Committee
Recommendation 5
5
The Departments will not know the actual levels of fraud and error within these schemes...
Conclusion
The Departments will not know the actual levels of fraud and error within these schemes until 2021. HMRC does not expect to have a statistical estimate of the total fraud and error levels across both schemes until the end of 2021. Whilst waiting for this estimate, there are other metrics already available that can begin to build a picture of the levels of fraud and error, such as the amounts of overpayments detected and recovered and the number of arrests and prosecutions due to criminal activity on the schemes. Levels of opportunistic fraud, where furloughed workers continued to work whilst companies claimed grants, could have occurred in between 7% to 34% of cases. HMRC also plans to publish which companies are accessing the extended CJRS and to directly notify employees when they have been furloughed, something it decided not to implement during the first phase of the scheme between March and October 2020. We welcome this suggestion that it is making some changes to try and reduce the opportunity for fraud to occur. Recommendation: HMRC should write to the Committee within three months outlining how it can utilise the information it already collects to better estimate the levels of fraud and error; and also outline what steps it intends to take to recover CJRS and SEISS grants made during the first phase of the scheme if recipients Covid-19: Support for jobs 7 made substantial profits or were not adversely affected by the pandemic. HMRC should list companies which have signed up to the furlough scheme by the end of January 2021.
Government Response
Not Addressed
HM Government
Not Addressed
5.1 The government agrees with the Committee’s recommendation. Target implementation date: March 2021 5.2 HMRC has already produced provisional assessments of Error and Fraud for CJRS and SEISS, using the best available evidence. The department will continue to improve and develop the evidence base for these assessments incorporating data from the schemes, operational compliance activities, and information from social research surveys. 2 https://www.gov.uk/government/publications/coronavirus-job-retention-scheme-awareness-understanding-and- customer-experience-surveys and https://www.gov.uk/government/publications/coronavirus-job-retention-scheme- understanding-customer-experience 28 5.3 The department will measure compliance levels using random enquiry programmes where appropriate. In the meantime, risk-based compliance activity to identify and recover incorrectly claimed grants continues to be a priority. 5.4 HMRC’s plans to recover funds from those who have deliberately abused CJRS and SEISS are set out in our post payment compliance approach – identifying cases via profiling, contacting many via one to many approaches and following up on those who do not respond, or whose responses need further investigation.