Just 1% of £1.1bn lost in Covid grants recovered

OFFICIALS failed to recover 99 per cent of the £1.1billion lost to error and fraud from the Covid business grant scheme, the public spending watchdog revealed.

Struggling companies received £22.6billion in grants between March 2020 and March last year – but nearly 5 per cent was squandered.

The Government has since recovered only £11.4million – or 1 per cent – of these losses, according to the National Audit Office (NAO).

The watchdog praised the Department for Business for learning lessons from their quick initial response, but critics last night called for ministers to step up their efforts to reclaim taxpayer cash.

John O’Connell, chief executive of the TaxPayers’ Alliance, said: ‘The scale of these losses will be a kick in the teeth for hard-working Brits. The Government needs to redouble efforts to claw back this lost cash.’

The NAO report suggested councils were not notified of business support grant schemes until they were announced publicly, leading to ‘significant practical challenges’.

They also said local authorities have had ‘no financial incentive to identify losses’ as the recovered money goes to central government.

NAO head Gareth Davies said the experience offered ‘important lessons should similar crises occur’.

A Department for Business spokesman said: ‘We are continuing to work hard to recover these funds where possible.’