Cabinet Office
I wish to confine my remarks to the responsible, resilient and transparent use of taxpayers’ money. I say that as the chair of the all-party parliamentary group on anti-corruption and responsible tax, a role which sees me engage with ministerial colleagues from across Government on a whole swathe of issues. I push Government constructively to increase transparency, improve controls and increase enforcement when those who seek to defraud the taxpayer are identified. Public sector fraud and error is estimated to cost taxpayers between £55 billion and £81 billion annually. That is not sustainable when we are asking taxpayers to shoulder a large burden and when our public finances are already squeezed, at a time of increasingly turbulent geopolitical headwinds. That is why, back in December 2024, I was delighted to see the Government announce the introduction of Tom Hayhoe as the new covid fraud commissioner. He was tasked with identifying areas of reckless spend overseen by the previous Government and going as far as possible in claiming back moneys for the taxpayer. Since then, Mr Hayhoe has identified £10.9 billion lost to fraud and error across the covid schemes, at a time when the Government’s resilience was pushed to the limit. Let us dwell on that £10.9 billion figure. Of that money, £324 million was lost in personal protective equipment fraud during the pandemic and £1.88 billion was lost in fraud on the bounce back loan scheme, issued by the Department for Business and Trade. We talk about more money for the defence investment plan or increased resilience at a time of increasing geopolitical instability, and those figures of taxpayers’ money lost to fraudsters by the last Government are truly astonishing. Without straying into ongoing litigation, let us dwell on the PPE Medpro scandal for a second. It has become symbolic of the waste and poor oversight that occurred during some covid-19 procurement processes. As we know, the company was awarded Government contracts worth more than £200 million through the controversial VIP lane system. In 2025, the High Court ruled that PPE Medpro had breached a £122 million contract for surgical gowns, because the products supplied did not meet the required standards, and the company was ordered to repay that money to the Government. That matters, because holding suppliers accountable when contracts are not fulfilled properly helps to protect public funds and reinforces the principle that those who benefit from Government contracts should meet their obligations. That is a vital premise, because we must ensure that Government procurement is resilient and delivering the best value. Ensuring that those who rip off the state—and, by default, you, Madam Deputy Speaker, me and every other person up and down the length of the country—are held to account is vital. Alongside our debate on the Cabinet Office’s estimates, will the Minister articulate why the Government announced last week that they had chosen to only “partially accept” four of Tom Hayhoe’s recommendations? The first of those recommendations was that the Government should have a challenge champion in crisis situations—we talk a lot about resilience. The second recommendation was to ensure that small companies publish profit-and-loss accounts—remember that small companies were the engine of the bounce back loan scheme fraud. The third recommendation was that there should be stronger measures when Ministers issue directions to override the civil service. That is crucial, given that ministerial directions included overriding an accounting officer’s concerns about fraud on bounce back loans. The fourth recommendation was to have clearer central oversight of the spending of the Ministry of Housing, Communities and Local Government through local bodies, including grants. I appreciate that my hon. Friend the Minister may not have the answers to hand, but I would be very grateful if she could write to me after this debate. Do not let my questions distract from the good work undertaken during this Parliament. I particularly commend the Cabinet Office for the work undertaken by the Public Sector Fraud Authority, including last week’s launch of the new public authorities fraud investigation and enforcement service. I had the benefit of meeting my hon. Friend the Member for Southampton Test (Satvir Kaur) only a few weeks ago to discuss the vital work of the PSFA. We both know how critical it is to drive up transparency, break down information silos, and drive cultural change via the tone from the top across Government. As such, we should be proud that the PSFA has reported savings to the taxpayer of £311 million in 2022-23, £373 million in 2023-24, and over £480 million in 2024-25. That is a trajectory I want to see continue—an increase of approximately 50% over the course of two financial years. In total, the Government reported £7.53 billion of taxpayer savings from counter-fraud activity in the last financial year, including almost £400 million linked to covid fraud that had been recovered. That is vital work that should not go unnoticed, and it is not small change; those are critical funds that need to be retained in the public sector, for the sake of our infrastructure, resilience and security. The Minister may not be surprised to hear me say that we must not rest on our laurels. I therefore welcome the views of my hon. Friend the Member for Southampton Test on establishing a central Government database to strengthen the detection and prevention of fraud, alongside enhanced mitigation measures and greater transparency in how they are implemented. I also support a new offence of fraud against the public purse, coupled with meaningful incentives and protection for whistleblowers to help identify and expose wrongdoing, as recommended by the campaigning organisation Spotlight on Corruption. My constituents—whether in Heaton or Horwich, Chew Moor or Chequerbent—need to know that the Government are on their side and that attempted public sector fraud will have consequences, no matter who you are or who you know. It is only by pursuing fraudsters tenaciously that we will be able to find the much-needed resources to support investment in critical infrastructure and ensure that we are as prepared as we can be, whether that is for the next pandemic, climate change, industrial sabotage or conflict.