UK Inquiry Tracker

COVID-19 Employment Support Schemes

Public Accounts Committee Closed Inquiry

Opened: 14 Oct 2022 Closed: 1 Jun 2023 Parliament page

In March 2020 the government announced two schemes to support employment during the pandemic: the Coronavirus Job Retention or “furlough” scheme, and the Self-Employment Income Support Scheme (SEISS). In total, the two schemes cost close to £100 billion of taxpayers’ money. A report by the National Audit Office has found … Read more In March 2020 the government announced two schemes to support employment during the pandemic: the Coronavirus Job Retention or “furlough” scheme, and the Self-Employment Income Support Scheme (SEISS). In total, the two schemes cost close to £100 billion of taxpayers’ money. A report by the National Audit Office has found that the employment support schemes achieved their primary aim of protecting jobs and businesses during the pandemic - with unemployment peaking at just over 5% - and that the actual costs of the schemes fell well below departmental estimates. However, the NAO noted that “Designing schemes at speed, coupled with the inherent uncertainty over the course of the pandemic, meant that the schemes would inevitably have flaws.” The NAO found that “it is likely that several billion pounds have been paid to claimants who saw their incomes increase during the period. The Committee will question senior officials at HMRC on whether the schemes achieved their objectives to support incomes and the labour market and reached those previously excluded from the schemes; how the Departments managed the delivery of the schemes through their later iterations, including attempts to improve the value for money of the schemes by making them more targeted while managing the risk of error and fraud; and how HMRC has estimated the level of error and fraud and undertaken compliance work to detect error and fraud. Commenting on the NAO report on Covid 19 employment support that underlies this inquiry and call for evidence, PAC Chair Dame Meg Hillier MP said: “Government's COVID employment support schemes protected millions of people and businesses from hardship during the pandemic. While it established this essential support quickly, billions of pounds were wasted through fraudulent claims and loose controls. Government was too slow to act in response. “HM Revenue & Customs must get a grip on how it measures and tackles fraud and error. Particularly at a time of constrained public finances, this could go a long way to supporting millions of citizens and essential public services.” If you have evidence on the issues raised in this inquiry, please submit it here by November 4 at 18:00. Show less

14 Recommendations

12 Conclusions

1 Report

1 Oral session

1 Letter

1 Event

Activity timeline 5 events

30 May
2023

Report published

Treasury minutes: Government response to the Committee of Public Accounts on the Fortieth report from Session 2022-23

8 Mar
2023

Report published

Fortieth Report - COVID employment support schemes

29 Nov
2022

Correspondence

Correspondence from Janet Alexander, Director Compliance Operations Directorate, HMRC, re HMRC Covid-19 Employment Support Schemes – Public…

17 Nov
2022

Oral evidence

COVID-19 Employment Support Schemes

17 Nov
2022

Formal meeting (oral evidence session) · The Grimond Room, Portcullis House

COVID-19 Employment Support Schemes

Oral evidence sessions 1 session

17 Nov 2022

View on parliament.uk

COVID-19 Employment Support Schemes

Beth Russell · HM Treasury Janet Alexander · HM Revenue and Customs Jim Harra · HMRC

Reports 1 report · click to expand

Title	HC No.	Published	Items	Response
Fortieth Report - COVID employment support schemes	HC 810	8 Mar 2023	26	Responded

Recommendations & Conclusions

5 results

1 Conclusion Acknowledged

Fortieth Report - COVID employment…

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

On the basis of a report by the Comptroller and Auditor General, we took evidence from HM Treasury and HM Revenue & Customs (HMRC) (collectively the Departments) on the COVID-19 employment support schemes.1

Government Response

The government acknowledged that the committee took evidence from HM Treasury and HM Revenue & Customs (HMRC) on the COVID-19 employment support schemes and that this document is their response.

HM Treasury

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8 Conclusion Acknowledged

Fortieth Report - COVID employment…

We pressed the Departments on the schemes’ wider impacts including whether the schemes had contributed...

We pressed the Departments on the schemes’ wider impacts including whether the schemes had contributed to the increasing number of business insolvencies and the increasing level of economic inactivity, given that the number of inactive people over 50 increased by … Read more

Government Response

The Departments stated that final evaluations would examine the schemes’ impacts on inactivity but that there was no evidence of increasing inactivity being particularly related to the schemes. They added that there had been a legal embargo on creditor insolvencies which had created some pent-up pressure.

HM Treasury

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20 Conclusion Acknowledged

Fortieth Report - COVID employment…

The government’s policy is to pursue deliberately fraudulent behaviour, but not to penalise applicants for...

The government’s policy is to pursue deliberately fraudulent behaviour, but not to penalise applicants for honest mistakes when claiming employment support. HMRC can pursue fraudsters through criminal investigations, which can result in cases going 27 C&AG’s Report, paras 3.5, 3.8, … Read more

Government Response

The government's policy is to pursue deliberately fraudulent behaviour, but not to penalise applicants for honest mistakes when claiming employment support and HMRC can raise penalties of up to 100% of any overpayment where it has sufficient evidence of deliberate fraudulent behaviour, in addition to requiring the claimant to repay the amount of money that was overpaid.

HM Treasury

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22 Conclusion Acknowledged

Fortieth Report - COVID employment…

We asked HMRC why the number of prosecutions was so low and why it was...

We asked HMRC why the number of prosecutions was so low and why it was not being tougher on those who had made fraudulent claims for employment support. HMRC told us that its approach was broadly the same as it … Read more

Government Response

HMRC explained that its approach to fraud in the schemes was similar to the tax system, using civil means primarily and reserving criminal investigations for very serious cases. They updated the committee on the number of criminal and civil investigations underway.

HM Treasury

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24 Conclusion Acknowledged

Fortieth Report - COVID employment…

We have stressed throughout our work examining the COVID-19 pandemic the importance of government learning...

We have stressed throughout our work examining the COVID-19 pandemic the importance of government learning lessons from its preparedness and response. In July 2021, we reported that the Government’s response to the pandemic had been least effective in areas that … Read more

Government Response

The government has stressed the importance of learning lessons from its preparedness and response to the COVID-19 pandemic. They cited work to build on the UK’s existing international collaborations including strong bilateral and multilateral relationships, to drive greater and broader collaboration on the global stage.

HM Treasury

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Government Response AI assessment · 23 of 14 classified

Accepted 13

Acknowledged 5

Not Addressed 2

Rejected 3

Total 14 recs + 12 conclusions

Correspondence 1 letter

29 Nov 2022 Correspondence from Janet Alexander, Director Compliance Operations Directorate, HMRC, re HMRC Covid-19 Employment Support Schemes – Public Accounts Committee, dated 21 November 2022

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