Whatever it costs?
By Peter Dobbs
In the depths of the first lockdown when most of us were confined to our homes for much of the day there was much talk of how this sacrifice should not be in vain. Instead it was to be a watershed and we would emerge from the crisis and rebuild a world in which things were greener and fairer.
We were genuinely grateful for the sacrifices of key workers who kept on doing their jobs despite the apparent risks and community spirit thrived with many selflessly helping the infirm and vulnerable.
However as the details of how the government responded during that time slowly emerge what is seen shows no evidence of a desire to 'build back better' but rather a government grasping at whatever appeared to offer a chance to return to 'normal' almost no matter what the cost.
The amount of cash pitched at the problem is so large that it is hard to get a handle on it but the following may help.
Lord Agnew, a Treasury and Cabinet Office minister, resigned in January this year because the government intended to write off £4.3bn of Covid loans or grants that were made fraudulently.
This write off is enough to cover the annual budget of Derbyshire Dales District Council for the next 350 years (at today's prices).
It was written off because grants and loans were issued with too little care, for example, to more than 1000 companies that were not even trading before the pandemic struck.
An article in the Guardian gives the interesting background to Lord Agnew.
"Theodore Agnew was the model of a modern Tory oligarch. A successful businessman, he made enough to dabble in the new politics. He did all the right things. He backed a chain of academy schools and joined a Conservative thinktank, Policy Exchange. He donated a dutiful £134,000 to the Tory party between 2007 and 2009. Part-owner of an AI consultancy called Faculty, Agnew set it to work for Johnson's Vote Leave campaign. He received a knighthood, then a peerage, and was then offered a ministerial post in Boris Johnson's government, at the time being advised by the former Vote Leave director, Dominic Cummings. Faculty won a fistful of government contracts worth almost £1m".
Yet even he resigned because he could see the appalling profligacy of the pandemic 'get back to normal' financial schemes.
Agnew estimated that total fraud across the public sector now ran at £29bn a year, or about 5p on income tax. The bounce-back loan fraud is estimated to have cost a third of the annual revenue of the proposed new national insurance levy of 1.25 per cent due in April.
He declared that the government's record as guardian of the country's resources was "desperately inadequate". The business department and its cash-gushing British Business Bank (BBB) had been "woeful" in their oversight and auditing of the scheme.
It would seem that Cummings' "madhouse" extended far more widely across Whitehall than just Downing Street. It embraced the Treasury and the business department, in what appears to have been a conspiracy of high-spending anarchy. The chancellor, Rishi Sunak, has already responded by promising to do "everything we can to get that money back". So far though, HMRC investigators have recovered a mere £536m of stolen money.
The Conservatives may wish to claim that they are fiscally responsible but these figures tell a different story.