Minister quits in Lords over government handling of Covid loans fraud

Read More

The minister responsible for efficiency has dramatically resigned his post publicly in parliament, saying he was unable to defend the way the government handled fraudulent Covid business loans.

“Given that I am the minister for counter-fraud, it would be somewhat dishonest to stay on in that role if I am incapable of doing it properly,” Theodore Agnew, a Cabinet Office minister whose brief also covers the Treasury, told the Lords.

“It is for this reason that I have sadly decided to tender my resignation as a minister across the Treasury and Cabinet Office with immediate effect.”

Agnew, a life peer since 2017, was responding to a Labour urgent question about the Treasury’s decision last week to write off ?4.3bn in Covid payments lost to fraud.

Asked by the Labour peer Denis Tunnicliffe if he could provide an accurate figure for how much had been written off, Agnew said he was speaking to defend the government, adding: “But I will only be able to do that in part.”

Oversight of Covid loans by the business department and the British Business Bank had been “nothing less than woeful”, Agnew said.

“They have been assisted by the Treasury, who appear to have no knowledge or little interest in the consequences of fraud to our economy or our society,” he said, adding that two counter-fraud staff at the business department would not “engage constructively” with his counter-fraud team in the Cabinet Office.

He said: “Schoolboy errors were made, for example allowing over a thousand companies to receive bounceback loans that were not even trading when Covid struck.”

Agnew insisted that his decision had nothing to do with “far more dramatic political events being played out across Westminster” relating to Boris Johnson and a continuing investigation into No 10 parties.

He said: “This is not an attack on the prime minister and I am sorry for the inconvenience it will cause. I hope that as a virtually unknown minister beyond this place, it might prompt others more important beyond me to get behind this and sort it out.”

After finishing his speech, Agnew walked out of the Lords chamber to applause from his fellow peers.

Labour’s Rachel Reeves, the shadow chancellor, said Agnew’s resignation was a “damning indictment of the chancellor and the government’s failures on fraud”.

She said: “That the government’s own anti-fraud minister feels he is unable to defend the government’s record on billions of pounds of taxpayer cash gifted to criminals tells you all you need to know about the incompetence of this government.”

Speaking after him, the Lib Dem peer Susan Kramer said: “Can I just take this opportunity to say on behalf of these benches how much we appreciate the honour and integrity that has just been displayed by the minister? I don’t think anyone could have raised questions more forcefully, more accurately or more completely than he has.”

Johnson’s spokesperson said: “We are grateful to Lord Agnew for the significant contribution he has made to government.

“On the wider issues that he’s raised, we introduced our unprecedented Covid support schemes at speed to protect jobs and livelihoods, helping millions of people across the UK, including nearly 12 million on the furlough scheme alone.

“We’ve always been clear fraud is unacceptable and are taking action against those abusing the system, with 150,000 ineligible claims blocked, ?500m recovered last year and the HMRC tax protection taskforce is expected to recover an additional ?1bn of taxpayers’ money.”