HMRC has published information on their research and analysis into error and fraud in the Covid-19 support schemes on 4 November 2021.

According to the report, CJRS has helped to pay the wages of 11.7 million employees and nearly 3 million self-employed.

However, HMRC currently estimate that the amount lost to fraud and error in the Covid-19 support schemes amounted during 2020/21 to 8.7% in Coronavirus Job Retention Scheme (CJRS), 2.5% for the Self Employment Income Support (SEIS) phases 1,2 and 3 and 8.5% in the Eat Out to Help Out scheme.

In real money

In monetary terms, this equates to £5.8 billion. The total spend for these schemes was just over £81 billion. HMRC and HM Treasury had anticipated that the schemes would be targets for fraud and that in addition, some customers would make genuine mistakes. In response to this they tried to design the schemes to combat this.  

As both the CJRS and SEIS schemes ran for longer than initially envisaged, further changes and improvements were made to the schemes which saw the amount of fraud and errors fall considerably.

Prevention

The report goes on to state that HMRC and HM Treasury prevented over 100,000 ineligible or mistake claims being made by including automated controls into the digital claim process.  

HMRC were able to block over 29,000 suspicious claims and registrations by conducting further pre-payment checks based on risk analysis and intelligence. This strategy prevented the loss of over £206 million.

The Taxpayer Protection Taskforce which has a staff of 1265 HMRC staff focusing on combating fraud in schemes has recovered £536 million in 2020/21 and expects to recover between £800 million and £1 billion between 2021 and 2023.

Mistakes and repayments

HMRC’s disclosure facility has been very successful as it has allowed customers to return £650 million in grants that they no longer needed. Customers have also made £350 million in repayments to correct mistakes made without HMRC’s intervention.

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