A minister has resigned at the dispatch box after criticizing the government’s record of tackling fraud in coronavirus trade schemes.
Lord Agnew, who was both Treasury and Cabinet minister, radically left his role in by Boris Johnson government in the House of Lords on Monday afternoon, claiming that the Department for Business, Energy and Industrial Strategy had shown a “lamentable” oversight of covid loan programs that have led to numerous frauds.
The peer told the chamber that the Treasury “seems to have no knowledge or little interest in the consequences of fraud on our economy or our society”, adding that a mixture of “arrogance, indolence and of ignorance freezes the machinery of government”.
Lord Agnew, who has been a minister since February 2020, added that his remarks and his resignation are “not an attack on the Prime Minister”.
More than £47billion has been given to small businesses under the government’s biggest coronavirus scheme – the Bounce Back Loan Scheme (BBLS) – which was intended to bail out businesses at risk during the pandemic.
The National Audit Office estimated that up to £5 billion could have been claimed fraudulently.
A Downing Street spokesman said: ‘We are grateful to Lord Agnew for his significant contribution to government.
Chancellor Rishi Sunak tweeted: “Lord Agnew has served the Treasury with diligence and commitment. I want to thank him for his dedicated service and tireless work during the pandemic.”
Before announcing his resignation, Lord Agnew was briefing his peers on the £4.3billion in COVID loans – canceled by the Treasury – which Labor says went to “fraudsters”.
The former minister said government oversight of the various commercial coronavirus programs was “nothing short of woefully inadequate” and that “schoolboy mistakes were made”.
“My lords, you can see that I am deeply convinced that the current situation is not acceptable,” he told his peers.
“Given that I am the Minister for Enforcement, it seems somewhat dishonest to remain in this role if I am unable to do it properly, let alone defend our record.
“It is for this reason that I have suddenly decided to tender my resignation as Treasury and Cabinet Minister with immediate effect.
“I would be grateful if my noble Lord conveys this lead to the Prime Minister as soon as possible.
“It is worth saying that none of this is linked to the much more dramatic political events unfolding in Westminster. This is not an attack on the Prime Minister and I am sorry for any inconvenience this will cause .”
Lord Agnew added: “Total fraud losses in government are estimated at £29billion a year.
“Of course, not everything can be stopped – but a combination of arrogance, indolence and ignorance freezes the machinery of government.
“The actions taken today will give this government a sporting chance to cut income tax ahead of the likely May 2024 election. If my impeachment helps that happen, it would have been worth it.”
Peer Provides High Drama Leaving His Post as Shipping Box Minister
The Lords are not used to big drama.
But today Lord Agnew provided that.
His critique of the government’s record of fighting pandemic support scheme fraud was methodical, detailed and excoriating.
The now former minister handed his resignation letter to a colleague and asked him to pass it on to the Prime Minister, closed his file and with a formal “thank you and goodbye” he walked out.
That sound rarely heard in the upper room – applause – sounded then.
But beyond the political drama, the points raised by Lord Agnew were deeply serious.
He accused the Treasury of having “no knowledge” or “little interest” in the fight against fraud.
It’s a damaging accusation, especially for a Chancellor who prides himself on his economic response to the pandemic.
It also comes a week after it was confirmed that £4.3billion in COVID payments had been canceled due to fraud.
Lord Agnew said the impact of this will be felt by all of us and that there is ‘a penny of income tax waiting to be claimed if we have just woken up’.
It was clear that his comments were not intended to hurt Boris Johnson.
Indeed, at times his criticism seemed to echo words we heard from former Number 10 adviser Dominic Cummings about the state’s failure to meet the needs of the public.
“Any prime minister should have a reasonable expectation that the levers of government are actually linked to the delivery of services to our citizens,” he told his peers.
Fair words indeed at a time when the government appears to be stuck in scandal-induced stasis.
Shadow Chancellor Rachel Reeves said Lord Agnew’s resignation is “a damning indictment of the chancellor and government failures in fraud”.
“The fact that the government’s own anti-fraud minister feels unable to defend the government’s record on the billions of pounds of taxpayers’ money handed over to criminals tells you everything you need to know about this government’s incompetence” , Ms. Reeves said in a statement.
“It should be a lasting source of shame for the Chancellor that he has so carelessly set aside £4.3billion of taxpayers’ money which is now in the hands of criminals and gangs.
“In addition to the billions spent on crony contracts and billions more lost in fraudulent loan schemes, these levels of waste destroy any Tory claim to prudent management of public finances. Labor would treat every pound of money from the taxpayers with the respect it deserves.”
Lord Agnew’s resignation following the failure of this government is more honest than Boris Johnson can handle.
No wonder a minister feels unable to defend taxpayers’ billions of pounds wasted on crony contracts and fraud.
“Arrogance, indolence and ignorance” indeed.
— Angela Rayner (@AngelaRayner) January 24, 2022
Angela Rayner, Deputy Leader of the Labor Party, added: ‘It’s no surprise that a minister feels unable to defend the squandering of taxpayers’ billions of pounds on crony contracts and fraud. ‘Arrogance, indolence and ignorance’ indeed.”
After concluding his resignation speech, Lord Agnew left the chamber to applause from some peers.
Number 10 insisted to reporters that the Government had made clear the fraud was ‘unacceptable’ following Lord Agnew’s resignation.
The Prime Minister’s official spokesperson said: “On the broader issues he has raised, we have rapidly introduced our unprecedented COVID support programs to protect jobs and livelihoods, helping millions of people to across the UK, including nearly £12million on the furlough scheme alone.
A statement released by the Treasury said: “Absolutely no fraudulent claims have been reversed – last year we stopped or recovered nearly £2.2bn of potential fraud from the Bounce Back loan scheme and 743 millions of overclaimed furlough grants.”
“We have always been clear that fraud is unacceptable and we are taking action against those who abuse the system, with 150,000 ineligible claims blocked, £500million recovered last year and the Tax Protection Task Force of the HMRC is expected to recover an additional £1billion from taxpayers.” money.”
This is not the first time a minister has resigned at the House of Lords dispatch box.
In 2018 Lord Bates stunned his peers when he announced he would step down because he was “ashamed” of not showing up in the Upper House on time.
However, the International Development Minister’s offer to resign was rejected by then-Prime Minister Theresa May. He then left the government the following year.