Recommendation 6

MHCLG’s previous attempts to speed up remediation exposed the taxpayer to increased risk of fraud. When MHCLG launched its high–rise Building Safety Fund in 2020 it relaxed a range of taxpayer protections in order get money out to projects quickly. While this approach has since been reversed, a potential loss of over £500,000 has been identified due to suspected fraud involving funds paid out in advance. MHCLG says 7 that counter–fraud activity was underway before a belated Fraud Risk Assessment was completed in 2023. We are concerned that poor record keeping resulted in documentation being lost. Lessons are being learned, and the Cladding Safety Scheme is on a sounder footing, including counter– fraud controls. As MHCLG prepares to accelerate remediation work, we are encouraged that it is engaging with the Public Sector Fraud Authority and taking forward work to undertake a measurement exercise to learn more about the extent of potential fraud and the effectiveness of its controls. recommendation MHCLG should, by the end of 2025: use findings from fraud measurement exercises to strengthen its counter–fraud controls and ensure they are adequate to meet accelerated funding demand; and share relevant learning across the Ministry to help prevent fraud in other programmes.