UK Inquiry Tracker

Bounce Back Loans Scheme: Follow-up

Public Accounts Committee Closed Inquiry

Opened: 26 Nov 2021 Closed: 5 Dec 2022 Parliament page

In December 2020 the Committee published its first report on the “Bounce Back Loan” Scheme offered to registered - and unregistered - small businesses to help them get through and recover from Government-mandated closures and loss of business revenues during lockdown. At that time the PAC concluded that billions of … Read more

17 Recommendations

9 Conclusions

1 Report

2 Oral sessions

5 Letters

2 Events

Activity timeline 9 events

6 Dec
2022

Correspondence

Correspondence from Sarah Munby, Permanent Secretary for the Department for Business, Energy and Industrial Strategy (BEIS), re Treasury Mi…

5 Dec
2022

Oral evidence

Bounce Back Loans Scheme: Follow-up; BEIS Annual Report & Accounts 21-22

2 Sep
2022

Report published

Treasury minutes: Government response to the Committee of Public Accounts on the Fiftieth report from Session 2021-22

27 Apr
2022

Report published

Fiftieth Report - Bounce Back Loans Scheme: Follow-up

22 Feb
2022

Correspondence

Correspondence from Sarah Munby Permanent Under-Secretary of State, Department for Business, Energy & Industrial Strategy, re PAC hearing o…

31 Jan
2022

Correspondence

Correspondence from Catherine Lewis La Torre, Chief Executive, British Business Bank, re Bounce Back Loans, dated 27 January 2022

11 Jan
2022

Correspondence

Correspondence from Stephen Pegge Managing Director, Commercial Finance UK Finance, re follow-up evidence session on the Bounce Back Loan S…

11 Jan
2022

Correspondence

Correspondence from Sarah Munby, Permanent Secretary, Department for Business, Energy & Industrial Strategy, re Covid loans - dissolutions …

10 Jan
2022

Oral evidence

Bounce Back Loans Scheme: Follow-up

Oral evidence sessions 2 sessions

5 Dec 2022

View on parliament.uk

Bounce Back Loans Scheme: Follow-up; BEIS Annual Report & Accounts 21-22

Andrew Harrison · NatWest Anne Boden · Starling Bank Dave Newcombe · Paragon Banking Group Gemma Peck · Department for Business, Energy & Industrial Strategy Karl Reid · HSBC Sarah Munby · Department for Business, Energy and Industrial Strategy Tom Taylor · Department for Business, Energy & Industrial Strategy

10 Jan 2022

View on parliament.uk

Bounce Back Loans Scheme: Follow-up

Catherine Lewis La Torre · British Business Bank Charles Roxburgh · HM Treasury Patrick Magee · British Business Bank Sarah Munby · Department for Business, Energy and Industrial Strategy Sheldon Mills · Financial Conduct Authority

Reports 1 report · click to expand

Title	HC No.	Published	Items	Response
Fiftieth Report - Bounce Back Loans Scheme: Follow-up	HC 951	27 Apr 2022	26	Response document linked

Recommendations & Conclusions

26 results

2 Recommendation

Fiftieth Report - Bounce Back Loan…

The potential Scheme losses are eye-watering, and we are not convinced the Department has the...

The potential Scheme losses are eye-watering, and we are not convinced the Department has the data it needs to manage the risks to the taxpayer. The Department estimated in its 2020–21 Annual Report and Accounts that it would lose £17 … Read more The potential Scheme losses are eye-watering, and we are not convinced the Department has the data it needs to manage the risks to the taxpayer. The Department estimated in its 2020–21 Annual Report and Accounts that it would lose £17 billion as a result of the Scheme, of which £4.9 billion was because of fraud. We have seen similarly high levels of expected losses due to fraud in other Covid-19 business support schemes, with losses from fraud and error within the furlough and self-employment schemes estimated at £5.7 billion. This staggering amount of taxpayer money could have been spent on improving existing public services. The Department admits that fraud within the Scheme falls well outside what it would consider a tolerable level, although it cannot tell us what that level should be. Its fraud estimate does not include all potential types of fraud, such as suspected turnover inflation fraud to claim larger loans than a borrower is entitled to. To date, it has allocated just £32 million to countering fraud and does not know whether lenders or other stakeholders, including law enforcement agencies, have the resources they need to counter fraud. The Department reports its estimates of losses once each year and these have a high level of uncertainty. The Bank’s loan data from the 24 commercial lenders under the Scheme has data limitations as each lender categorises and reports data in a slightly different way. The Department is trying to improve its approach to quantifying losses in the Scheme, but it is almost two years since its launch. 6 Bounce Back Loans Scheme: Follow-up Recommendation: The Department should, within the next 3 months, develop a strategy setting out the increase needed in Scheme counter-fraud resources for all relevant government stakeholders to both reduce fraud levels to a tolerable level and to maximise recoveries. As part of its Treasury Minute response, the Department should explain how it intends to improve the accuracy and timeliness of Show less

HM Treasury

Bounce Back Loans Scheme: Follow-up

Activity timeline 9 events

Oral evidence sessions 2 sessions

Reports 1 report · click to expand

Recommendations & Conclusions

The potential Scheme losses are eye-watering, and we are not convinced the Department has the...

The Department has been complacent in preventing Scheme fraud and its prioritisation of ‘top tier’...

We are concerned that the Department is placing too much reliance on lenders to minimise...

It is unacceptable that the Department has no plans to recover outstanding debt after lenders...

The Scheme has distorted the Small and Medium Enterprise (SME) lending market in favour of...

The Department has not yet identified how it will share the lessons from the Scheme.

On the basis of a report by the Comptroller and Auditor General, we took evidence...

The Department’s estimate of the credit loss within the Scheme is also uncertain, as there...

The Bank began collecting Scheme loan data from the 24 Scheme lenders in July 2021,...

The Scheme rules required commercial lenders to deliver loans and pursue recovery processes in line...

Although the Department referred to lenders as the “arms and legs” of the Scheme, none...

The Scheme requires lenders to pursue borrowers for missed repayments for up to 12 months...

The NAO reported that the arrangements for pursuing borrowers offered limited commercial incentive for lenders...

Almost 86,000 borrowers have been in arrears for more than 90 days as of 10...

The Department and the Bank recognised that there was a trade-off between getting loans to...

The Scheme has also made trade-offs in its response to countering fraud and the associated...

We asked the Department if it was confident that enough was being done to tackle...

We reported previously that the Department had no apparent plans to measure the Scheme’s long-term...

We asked the Department whether it currently had the information that it needed to determine...

Business survival rates are a key metric for measuring the Scheme’s impact.

Lenders used their own funds to make Scheme loans, with government guaranteeing to reimburse lenders...

The NAO reported that there were seven accredited lenders when the Scheme launched in May...

The Bank recognised that it was “absolutely true that [the Scheme] had a distortive effect”...

We highlighted previously that government needed to use the lessons learned from this Scheme to...

We were concerned that the Department should have identified these lessons when it supported businesses...

We asked whether, with hindsight and more time, it would have been possible to design...

Correspondence 5 letters