Source · Select Committees · Public Accounts Committee
Recommendation 15
15
The Bank does not collect information on how businesses have used the loans.36 The NAO...
Conclusion
The Bank does not collect information on how businesses have used the loans.36 The NAO report outlined that there is some evidence that businesses are using the money to pay back existing debt, which the Bank describes as a ‘economically rational’ for businesses to do.37 But this would reduce the benefit of the Scheme as it would only make a small difference to a businesses’ available cash; it would, however, help lenders reduce their exposure to bad debts as the Scheme loans are subject to a government guarantee. The Bank said it will investigate how businesses have used the loans during 2021, which may be after the Scheme closes.38 This lack of data undermines the Bank’s ability to understand the impact of the Scheme, to monitor and report levels of fraud, and to use information to better inform future schemes. The Department told us that any initial evaluation of the Scheme will not start until 2021, with further reviews over time, across the six to ten year pay-back period.39 Rules for lenders to follow to debt recovery
Government Response
Not Addressed
HM Government
Not Addressed
6: PAC conclusion: Government has no apparent plans to measure the Scheme’s impact, including identifying how many businesses have been unable to access support. 6: PAC recommendation: The Department and the British Business Bank should set out, within the Treasury Minute response, how they plan on measuring the Scheme’s impact on businesses. They should ensure that any new schemes have, prior to launch, agreed performance measures. The Department should also analyse the impact of the Scheme on the lending market, paying attention to levels of competition and consumer choice. 6.1 The government agrees with the Committee’s recommendation. Target implementation date: Autumn 2021 6.2 The department is actively implementing a Monitoring and Evaluation plan across the three current schemes. As part of this, working with the department, the Bank has put out to tender a contract for an independent evaluator to assess the schemes. This will involve a process evaluation, impact evaluation and economic evaluation, publishing an initial assessment by Autumn 2021. As part of the ongoing analysis of current schemes and potential future schemes, the government is analysing the wider lending market, and the role of the government. The department will actively work to ensure SMART objectives are developed upon for any future schemes, with key metrics and performance measures outlined and agreed.