UK Inquiry Tracker

DCMS management of COVID-19 loans

Public Accounts Committee Closed Inquiry

Opened: 31 Oct 2024 Closed: 16 Jun 2025 Parliament page

The COVID-19 pandemic placed enormous strain on the arts and sports sector, as many organisations were forced to close for prolonged periods. The Department for Culture, Media and Sport (DCMS) provided around £2.6 billion of support for organisations from 2020-22. A proportion of this support, £474 million, was provided in … Read more The COVID-19 pandemic placed enormous strain on the arts and sports sector, as many organisations were forced to close for prolonged periods. The Department for Culture, Media and Sport (DCMS) provided around £2.6 billion of support for organisations from 2020-22. A proportion of this support, £474 million, was provided in the form of loans repayable for up to 25 years. Given that this is the first time the DCMS has managed a loan book of this size, the National Audit Office (NAO) has launched an investigation into its ability to do so. As well as seeking to understand how effectively the DCMS is able to manage its loan book, it will also question if there are appropriate measures in place to oversee the repayment process. The NAO’s report will seek to understand how the department has managed any challenges that have arisen from the process so far. The Committee previously examined the Culture Recovery Fund , publishing its findings in 2021. The Committee warned that the DCMS would need a clear plan for how it would oversee the fund, ensuring it had the skills and capabilities within the organisation to do so. The Committee also recommended the Department implement lessons from across Government to ensure the process could benefit from the successes of other comparable schemes. Using the findings of the NAO report, the Committee will take evidence from senior Department of Culture, Media and Sport officials, with likely focuses including: - How effectively the Department has been able to manage its loan book and the processes it has in place in order to do so; - If the Department has a long-term plan for managing loan repayments and maximising financial returns and; - What lessons, if any, could be learned from the Departments approach to the governance of loan repayments. Please look at the requirements for written evidence submissions and note that the Committee cannot accept material as evidence that is published elsewhere. Show less

1 Recommendation

24 Conclusions

1 Report

1 Oral session

6 Letters

1 Event

Activity timeline 10 events

12 Mar
2026

Correspondence

Letter from the Permanent Secretary at the Department for Culture, Media and Sport relating to recommendations 1 and 4a of the Committee’s …

10 Jul
2025

Report published

Treasury minutes: Government response to the Committee of Public Accounts on the Twentieth report from Session 2024-25

2 Apr
2025

Report published

20th Report - DCMS management of COVID-19 loans

2 Apr
2025

Correspondence

Letter to the Permanent Secretary of DCMS relating to PAC report: DCMS management of COVID-19 loans, 1 April 2025

2 Apr
2025

Correspondence

Letter from the Permanent Secretary of DCMS relating to PAC report: DCMS management of COVID-19 loans, 1 April 2025

27 Mar
2025

Correspondence

Letter from the Director General for Policy at the Department for Culture, Media and Sport relating to the DCMS management of COVID-19 loan…

11 Feb
2025

Correspondence

Letter from the Permanent Secretary of the HM Treasury relating to the Local authority administered COVID support schemes in England, 31 Ja…

11 Feb
2025

Correspondence

Letter from the Permanent Secretary for the Department for Culture, Media and Sport relating to updates on progress made in Grassroot parti…

10 Feb
2025

Oral evidence

Oral evidence session

10 Feb
2025

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

Committee event

Oral evidence sessions 1 session

10 Feb 2025

View on parliament.uk

Gareth Davies · National Audit Office Gareth Davies · Department for Transport Max Tse · National Audit Office Nicola Hewer · Department for Culture, Media and Sport Polly Payne · Department for Culture, Media and Sport Rebecca Sheeran · National Audit Office Susannah Storey · Department for Culture, Media and Sport

Reports 1 report · click to expand

Title	HC No.	Published	Items	Response
20th Report - DCMS management of COVID-19 loans	HC 364	2 Apr 2025	25	Responded

Recommendations & Conclusions

12 results

2 Conclusion Accepted

20th Report - DCMS management of C…

Ensure PwC delivers full loan system functionality by September 2025 and prepare for contract end.

The Department’s management of its contract with PwC has been poor. The Department originally appointed PwC to advise on options for the management of its loans. After PwC identified the need for a managed service provider, the Department appointed PwC … Read more

Government Response

The government states that PwC delivered the full additional functionality for the loan management system in March 2025 for under £300,000. They have extended PwC's original contract for a year for business continuity and a strategic review will inform the future requirement for a Managed Service Provider, with re-tendering planned if needed.

HM Treasury

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3 Conclusion Accepted

20th Report - DCMS management of C…

Department lacks understanding of long-term value for money for loan book management options.

The Department does not yet know which options for the loan book’s future management would provide best value for the taxpayer in the long term. The costs of managing the loan book to date have been significant, at about £17 … Read more

Government Response

The government states it will undertake a strategic review of the loan book programme, to be completed this financial year (2025-26), to re-assess its strategic options, including a sale or partial sale, once all borrower repayment holidays end in September 2025.

HM Treasury

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4 Conclusion Accepted

20th Report - DCMS management of C…

Revisit loan repayment estimates and demonstrate tough management of troubled borrowers.

The Department is being overly optimistic in the management of its loan book in the face of continuing uncertainty over future repayments. The Department, as at October 2024 had received less in repayments than was due, the level of insolvencies … Read more

Government Response

The government agrees to safeguard taxpayers' money and maximise financial returns, stating it has no current plans to provide further direct loans to sport and culture organizations. They reiterate that grants are awarded for specific projects.

HM Treasury

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5 Conclusion Accepted

20th Report - DCMS management of C…

Compile a strategy for consistent and fair engagement with different sports borrowers.

The Department is displaying an inconsistent approach to its engagement with professional sports. The majority of the Department’s loans to sport bodies went to professional sport. For example, 57% (£124 million) of the Department’s sports loans went to top–tier, professional … Read more

Government Response

The government is developing a comprehensive borrower engagement plan that will build on existing strategies and be guided by core principles to ensure consistent and fair engagement with different sports and borrowers.

HM Treasury

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1 Conclusion Accepted

20th Report - DCMS management of C…

Evidence gathered on Department's management of COVID-19 loan book.

On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department for Culture, Media and Sport (the Department) on the management of its COVID–19 loan book.1

Government Response

The government will undertake a strategic review of its loan book management in the current financial year, including an external evaluation and consideration of alternative management options.

HM Treasury

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9 Conclusion Accepted

20th Report - DCMS management of C…

Hybrid loan management approach caused integration issues and objective tension.

The Department did not employ a specialist loan management company. It told us that it adopted a hybrid approach, with separate loan agents for culture and sport and a managed service provider, to the management of its loan book in … Read more

Government Response

The government agrees to undertake a strategic review of its loan book management by March 2026 including an external evaluation of the efficiency and effectiveness of the current operating model, and will consider alternative management options.

HM Treasury

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10 Conclusion Accepted

20th Report - DCMS management of C…

Department increased PwC contract scope for loan management system, raising costs.

The Department originally commissioned PwC in 2022 to assess the different options for the long–term management of its loan book. In line with PwC’s advice, the Department decided to retain management of the loan book in–house, with day–to–day management through … Read more

Government Response

The department took steps to ensure it had a robust model in place, and has received 97% of the repayments scheduled at the date of the NAO report.

HM Treasury

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11 Conclusion Accepted

20th Report - DCMS management of C…

Department justified increased PwC contract scope for system functionality and future flexibility.

We observed that the above arrangements appeared favourable to PwC and that it was not unheard of for government to appoint consultants to implement the advice they have given and for the scope of such implementation work, and therefore its … Read more

Government Response

The full Loan Management System (LMS) Version 2 (V2) functionality was implemented in March 2025 for under £300,000 and the original PwC contract has been extended to preserve business continuity.

HM Treasury

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12 Conclusion Accepted

20th Report - DCMS management of C…

Loan management system launched 15 months late with ongoing functionality concerns.

The Department planned to have the original data platform in place in March 2023. However, the loan management system only went live in June 2024, 15 months later than originally planned. The Department’s decision to increase the scope of PwC’s … Read more

Government Response

The full Loan Management System (LMS) Version 2 (V2) functionality was implemented in March 2025 for under £300,000 and the original PwC contract has been extended to preserve business continuity.

HM Treasury

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13 Conclusion Accepted

20th Report - DCMS management of C…

Department spending additional £300,000 to resolve loan management system functionality issues

The Department recognised, at the time of the system going live, that it had to resolve a small number of issues to ensure the system was operating as intended, and it planned further improvements to functionality around, for example, automatic … Read more

Government Response

The full Loan Management System (LMS) Version 2 (V2) functionality was implemented in March 2025 for under £300,000 and the original PwC contract has been extended to preserve business continuity.

HM Treasury

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16 Conclusion Accepted

20th Report - DCMS management of C…

Nine borrowers became insolvent, defaulting on £46.1 million in loans, exceeding expectations

By October 2024, 45% of solvent borrowers had made at least one repayment on their loans, with the remaining 55% yet to make a repayment. The 45% had paid the Department £40.9 million in total, less than the £42.1 million … Read more

Government Response

The department makes annual adjustments to reflect borrowers' circumstances and recognises an expected credit loss, and will revisit its strategic repayment forecasts after the repayment holiday ends in September 2025, undertaking further cost, repayment and insolvency modelling through the department’s strategic review.

HM Treasury

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19 Recommendation Accepted

20th Report - DCMS management of C…

Department identified two potential fraud incidents totaling £2.2 million in COVID-19 loans

As at December 2024, the Department had identified two possible incidents of fraud among its borrowers, relating to loans valued at £2.2 million.47 It told us that it considered the level of fraud in its COVID–19 loans to be relatively … Read more

Government Response

The government agrees to develop a comprehensive borrower engagement plan by November 2025 that builds on existing strategies, guided by core principles and medium-term strategies that link key borrower and loan characteristics to appropriate engagement methods.

HM Treasury

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Government Response AI assessment · 25 of 1 classified

Accepted 12

Acknowledged 4

Deferred 6

Rejected 3

Total 1 rec + 24 conclusions

Correspondence 6 letters

12 Mar 2026 To committee Letter from the Permanent Secretary at the Department for Culture, Media and Sport relating to recommendations 1 and 4a of the Committee’s Twentieth Report on DCMS management of COVID-19 loans, 03 March 2026

Parliament page

2 Apr 2025 From committee Letter to the Permanent Secretary of DCMS relating to PAC report: DCMS management of COVID-19 loans, 1 April 2025

Parliament page

2 Apr 2025 To committee Letter from the Permanent Secretary of DCMS relating to PAC report: DCMS management of COVID-19 loans, 1 April 2025

Parliament page

27 Mar 2025 To committee Letter from the Director General for Policy at the Department for Culture, Media and Sport relating to the DCMS management of COVID-19 loans: rugby union follow-up, 17 March 2025

Parliament page

11 Feb 2025 To committee Letter from the Permanent Secretary of the HM Treasury relating to the Local authority administered COVID support schemes in England, 31 January 2025

Parliament page

11 Feb 2025 To committee Letter from the Permanent Secretary for the Department for Culture, Media and Sport relating to updates on progress made in Grassroot participation in sport and physical activity and DCMS management of COVID-19 loans, 06 February 2025

Parliament page