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Furlough fraud involves the exploitation of the government’s Coronavirus Job Retention Scheme (CJRS) – which was established to provide financial support amid the COVID-19 pandemic. Under original furlough rules, employees placed on the scheme were not permitted to work for their company while on furlough. However, some unscrupulous employers have exploited the scheme, breaking the rules for their own financial gain.
Concern has risen about these instances as the scheme builds to its culmination, and now MPs have scrutinised the way in which the scheme was implemented.
A “hasty” roll-out of the Job Retention Scheme, the Commons Public Accounts Committee stated, may have led to the loss of billions in taxpayers’ money.
Meg Hillier, Chair of the Public Accounts Committee, commented on the worrying issue.
She said: “Best estimates really won’t do when you’re talking about multi-billions of pounds that could be being collected to support public services, and particularly when billions of pounds is being spent on COVID support.
“Our finding of the astonishing lack of economic planning for a pandemic shows how the unacceptable room for fraud against taxpayers was allowed into the government’s hastily drawn up economic support schemes.
“I would like to see the government publish a list of the companies which received furlough money.
“Where taxpayers money is being used, transparency should be a given.
“HMRC must act now to minimise fraud and error and ensure that taxpayers do not pay time and time again in the years to come.”
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The furlough scheme is set to come to a close at the end of the month – on October 31.
However, HMRC has already commenced its post-payment investigations, and will be looking into the matter further in the coming weeks and months.
Jim Harra, the chief executive of HMRC, previously stated it was likely the scheme would be exploited – both by employers and organised criminals.
But he also stated HMRC had struck an appropriate balance between protecting the Treasury and ensuring those who needed support were able to obtain this quickly.
An HMRC spokesperson said: “The government’s number one priority from the start of the outbreak has been on protecting jobs and getting support to those who need it as quickly as possible.
“Our income support schemes have provided a lifeline to millions of hard working families across the UK and we make no apology for the speed at which they were delivered.
“Without them lives would have been ruined.
“Our schemes were designed to minimise fraud from the outset and we have rejected thousands of fraudulent claims.
“We will not tolerate those who seek to defraud taxpayers and will take action against perpetrators – including criminal prosecution.”
For those who suspect furlough fraud could be taking place, perhaps in their organisation, the government has encouraged the matter to be reported.
To aid this, HMRC has updated online forms which can be accessed through the government’s website.
These can be completed anonymously for further action to be taken if necessary.
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