2. 1 The government agrees with the Committee’s recommendation. Recommendation implemented 2.2 The department seeks to use all available data in the design and implementation of its business support schemes to help strike the right balance between protecting the taxpayer and delivering policy objectives. 2.3 The department was unable to conduct a robust value for money assessment ahead of the scheme’s launch. Initial analysis indicated that the 100% guarantee, the removal of checks and the reliance on self- certification would create significant risks around fraud and credit losses. The department considered that it was unclear whether the benefits of the scheme would compensate for these issues by ensuring more businesses could access the finance they needed. The then departmental Accounting Officer set out these concerns in her letter to the then-Secretary of State on 1 May 2020 seeking a ministerial direction to implement the scheme on the grounds of highly uncertain value for money and propriety. Given the seriousness of the economic circumstances faced by businesses as a result of COVID-19, ministers considered it was appropriate to take this step. 2.4 Since the Scheme’s launch, the department and the Bank have undertaken a range of analytical work to understand better the impacts of the Scheme and to inform future policy development. This includes designing dashboards to monitor management information and comparing Scheme data with the Inter- Departmental Business Register and Companies House data to provide a more detailed view of the loan book. With external support, the department has also developed a model to estimate the net liquidity needs of small and medium-sized businesses resulting from the pandemic, providing further insights. A comprehensive monitoring and evaluation plan has been developed across all three loan guarantee schemes, and an Invitation to Tender is currently live, seeking to appoint an external contractor to conduct a process, impact and economic evaluation. This will make thorough use of all existing data sources in addition to conducting primary data collection across a range of areas. Analytical work will continue as the availability of data improves.