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Protect welcomes Chancellor’s new Covid-19 taskforce 

The Chancellor Rishi Sunak announced in his Budget, the creation of a new Covid-19 taskforce – the Taxpayer Protection Taskforce – tinvestigate and sanction fraudulent abuses of Covid-19 relief schemes. Whilst Protect welcomes this response to tackle fraud against taxpayers, we would also like to call on the government to follow whistleblowing best practice, particularly by ensuring whistleblowers who speak out about furlough fraud, do not get penalised 

At the start of the pandemic, the Coronavirus Job Retention Scheme (the furlough scheme) was intended to help employers through the economic hardships of lockdown and avoid mass unemployment. By some measures, the scheme was successful. At its peak, it covered 8.9 million workers(1) and data from the Office for National Statistics shows that less than 1% of the workforce was made redundant in every twoweek survey period during the summer of 2020.(2) 

However, soon after the furlough scheme was announced, it became clear that many employers were abusing it. Protect’s Advice Line was inundated with calls from whistleblowers whose employers were committing furlough fraud – callers told us their employers forced them to continue working whilst furloughed. In other cases, workers continued working and did not even know they were allegedly furloughed until they received their pay chequeWorkers were put into impossible positions: continue working and risk looking complicit in the wrongdoing, or refuse to work and be dismissed 

Protect is proud of the many whistleblowers who chose to speak up against this public interest wrongdoing. In fact, furlough fraud is the single biggest issue that Protect has dealt with in its history. Our report into Covid-19 and whistleblowing shows that 62% of cases to our Advice Line concerned furlough fraud during the first six months of the pandemic. Below is a furlough case study which is fairly typical of the many furlough concerns we advised on. 

 Timothy works in the finance department of a small company. During his work organising the company accounts he noticed that he and 5 other members of staff (including a director) have been placed on furlough leave. All the staff on the scheme are still working for the company. Timothy raised his concerns with his line manager, the Finance Director. The response was to remove Timothy from the scheme, but the line manager refused to remove anyone else as he felt bodies such as HMRC would not have the resources to prosecute all those companies that breached the rules. 

Protect is concerned by the enormous scale of the exploitation and HMRC have estimated that up to £3.5bn may have been claimed fraudulently or paid in error.3  so we are pleased by the Chancellor’s announcement that a dedicated team housed within HMRC will be given the budget and resources to reclaim this money. Many whistleblowers we spoke to on this issue were concerned that HMRC would simply not investigate their concerns because of the vast number of claims. Whilst it cannot be said with certainty that HMRC will be able to investigate and sanction every incident of fraud, it is encouraging that the bravery of whistleblowers to speak up against wrongdoing is taken seriously.  

Protect now calls on the Government to make a clear statement that the taskforce will follow best practice in handling whistleblower cases, particularly if the taskforce will be staffed with new recruits who may not be familiar with whistleblowing investigationsMany whistleblowers who contacted us at the height of the furlough fraud scandal expressed their fear of suffering detriment as a result of raising concerns about furlough fraud and worried that their identities would be revealed – or worried that if they raised the matter to HMRC, they would be held liable for working while allegedly furloughed.  

Protect policy officer Kyran Kanda said, “The taskforce must maintain the confidentiality of whistleblowers, and should, where requested, offer feedback. Our Better Regulators guide sets out six key principles for ensuring whistleblowing practice maximises intelligence and minimises harm. 

“The Government must also recognise the powerless position many workers were forced into by their employers and make a clear statement that whistleblowers will not be sanctioned for coming forward. 

 

  1.  https://www.bbc.co.uk/news/business-54601117
  2.  https://www.gov.uk/government/news/official-figures-show-that-the-furlough-scheme-has-worked-saving-jobs-and-helping-more-than-half-of-employees-back-to-work-already