Sunak defends Covid loan scheme over excessive fraud claims
Summary
Former Prime Minister Rishi Sunak defended the Bounce Back Loan scheme, which supported businesses during the Covid-19 pandemic, against claims of excessive fraud. Sunak acknowledged the risks of fraud but emphasized the importance of quickly helping businesses. The scheme provided loans with full government backing, and some fraud was expected but deemed necessary to keep companies afloat.Key Facts
- Rishi Sunak was the chancellor during the Covid-19 pandemic and led the Bounce Back Loan scheme.
- The scheme offered small businesses loans up to £50,000 with a full government guarantee.
- Approximately 1.5 million loans worth £46 billion were issued through the program.
- Lenders flagged about £1.9 billion of the loans as potentially fraudulent.
- A report estimated total fraud and error in the scheme could reach up to £2.8 billion.
- The government launched the scheme quickly, with few initial checks, to help businesses stay open.
- Steps were later added to reduce fraud, including systems to block multiple loan applications by the same business.
- Sunak stated that about 4% fraud rate for the scheme was similar to other government aid programs.
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