United Kingdom

Rishi Sunak will launch £100million taskforce to catch the Covid fraudsters

Rishi Sunak is to launch a £100million taskforce to crack down on Covid fraud.

The Chancellor will use next week's Budget to unveil plans for the new unit following criticism that the furlough and business loans schemes have been left wide open to exploitation by fraudsters.

The new Taxpayer Protection Taskforce will have 1,265 staff and be based in HM Revenue and Customs (HMRC).

Chancellor Rishi Sunak, pictured last March on Budget Day will deliver his second budget speech next week where he will announce the creation of the new Taxpayer Protection Taskforce will have 1,265 staff and be based in HM Revenue and Customs (HMRC)

The new squad will focus on tracking down criminal gangs thought to have stolen billions of pounds by posing as legitimate businesses

It will focus on tracking down the criminal gangs thought to have stolen billions of pounds by posing as legitimate businesses.

Rogue employers who have claimed cash under false pretences will also be targeted and an advertising campaign will remind fraudsters that they face the threat of prosecution if they are caught.

It also emerged that:

Next week, the Chancellor is expected to extend most existing Covid support schemes until the summer in line with the Government's 'roadmap' for unlocking the economy. 

With the cost of the furlough scheme alone now exceeding £50billion, the extension is expected to cost tens of billions of pounds.

Commenting on the anti-fraud taskforce, Mr Sunak said: 'Our coronavirus support schemes have helped millions of honest, hard-working people, but a small minority have seen this pandemic as an opportunity to defraud the taxpayer. 

'This will not be tolerated, which is why the new taskforce will crack down on this criminal activity.'

Although the Covid support schemes are credited with saving millions of jobs and keeping many businesses afloat, ministers have faced stinging criticism from auditors and MPs over lax rules that have made them easy for criminals to exploit. 

HMRC estimates that up to 10 per cent of furlough cash may have been claimed fraudulently, a sum now equal to more than £5billion.

HMRC believe up to £5bn in Covid grants could have been claimed by fraudsters 

Some experts have predicted that up to half of the £45billion lent under the Bounce Back Loans scheme may be lost to defaults and fraud.

Officials have already begun 10,000 investigations into suspected fraud, but insiders acknowledge they represent the tip of the iceberg.

Mr Sunak's announcement means that the number of officials working on Covid fraud will rise from 700 to 1,265.

The Treasury last night insisted that HMRC 'already have a rigorous system in place to counteract fraud, working through payment data, PAYE records, and reports from the public to identify potential wrongdoing'.

Bank chief's wild inflation fears

Shoppers could face soaring prices in the wake of the pandemic, the Bank of England's chief economist warned yesterday.

Andy Haldane said efforts to control inflation would be like 'trying to catch a tiger by its tail'. He is confident the UK economy can bounce back strongly when lockdown ends and Britons rush to spend again.

But he added there is a 'tangible risk inflation proves more difficult to tame' in the next year. 

Any rise would be bad news for consumers, who would be faced with more expensive goods. But it would be a welcome boost for savers if it caused the Bank of England to lift its base interest rate from the record low level of 0.1 per cent.

In January inflation hit 0.7 per cent, up from a four-year low of 0.2 per cent last August. But Mr Haldane said it could well pass the Bank's 2 per cent target over the course of the next year.

In an online speech yesterday, he said: 'People's appetite to spend and socialise has been artificially suppressed. This increases the chances of an overshoot [in inflation] as restrictions are removed.'

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