URGENT action is being demanded on the much-delayed Economic Crime Bill following the dramatic resignation of a Tory peer over plans to further delay it, despite earlier promises from the UK Government.
Lord Agnew resigned from his role as minister for the Cabinet Office and Treasury on Monday after saying that the Treasury had "no knowledge or little interest in the consequences of fraud" to the British economy.
From the despatch box of the House of Lords, Agnew, the minister responsible for tackling fraud, said that "schoolboy errors" such as allowing more than 1000 firms that were not trading before the pandemic, to claim bounceback loans, intended to help firms recover from effects of government policy such as lockdown.
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Agnew detailed that £5.8 billion of public money meant for Covid loans had been given out to fraudulent claimants and that £4.3bn has still not been recovered with the Treasury apparently planning to "write off" the remainder.
The SNP's shadow chancellor has said the revelation shows that the Tories are "allowing tens of billions to fall out the pocket of the Treasury and into the hands of criminals".
In response to Agnew's resignation, an urgent question was brought in the Commons to ask business minister Paul Scully (below) the Government's plans for an Economic Crime Bill amid concerns raised by the Tory peer that it would be scrapped.
Unable to provide an answer to Tory MP Kevin Hollinrake who brought the question, Scully said that he was not going to "speculate on the content of any future Queen’s Speech" but that the UK Government is "committed to tackling economic crime".
Hollinrake told Scully that fraud was not just a "white-collar offence" but is the mechanism through which terrorists and drug dealers launder their money through UK banks due to a lack of basic checks being carried out.
The Thirsk and Malton MP said: "Up to 50% of monies flowing through Russian laundromats often used for tax avoidance, stolen public funds and to launder monies derived from organised crime flow through UK shell companies.
“UK corporate structures were involved in arms deals which breached sanctions in the Sudan.”
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SNP shadow chancellor Alison Thewliss said economic crime could be halted in many cases if the UK Government “tightened up” Companies House, insisting reform is “well overdue”.
She said in some cases “absolute nonsense” is entered onto the register but is accepted, adding: “All of which has led to an open door through which crooks and fraudsters have been allowed to waltz off with public money and Government-backed loans.”
Conservative former cabinet minister Andrew Mitchell added: “Companies House remains a very good library but it doesn’t have investigatory powers, and it is there we want to see progress made.”
Labour former minister Chris Bryant called on the Government to act on its pledges, saying that the UK is a "soft touch" on economic crime and that the country has to move swiftly in order to send a "strong message to Russia".
Scully repeated his statement about not wanting to pre-empt the Queen's speech, which sets out the agenda for the Government and is written by the administration for the monarch to read.
Commenting after the Commons session, Thewliss said: “The cost to the taxpayer in economic crime and stolen public money is more than just a number on a piece of paper, it comes at the cost of welfare support, NHS investment and vital public services.
“Despite this, it seems clear the Tories will keep kicking the can down the road, allowing tens of billions to fall out the pocket of the Treasury and into the hands of criminals.
“Millions of hard-working people were excluded entirely from financial support during the pandemic, we were told there was no money available to support certain groups yet, as Lord Agnew pointed to in his resignation, the Tories could even cut taxes if fraudsters were successfully pursued."
Thewliss also raised the fact that millions of Universal Credit claimants had their benefits cut by £1040 per year last year just as the UK is about to experience a significant hike in energy prices.
She continued: “That a government would purposely cut benefits and support to the most vulnerable in the middle of a pandemic and exclude millions from any support whatsoever, all while turning a blind eye to crooks and fraudsters, is reprehensible.
“The UK Government could have fixed many of the issues years ago had they brought forward a bill and tightened up Companies House, instead here we are watching as our money goes down the drain – all at the cost of support for real people.”
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