A MINISTER’S resignation live at the despatch box has been described as “one of the most dramatic moments” ever seen in the House of Lords.
Lord Agnew of Oulton resigned from the UK Government over how it has handled fraudulent Covid business loans.
After telling the Lords he was unhappy with working between BEIS and the Treasury, Lord Agnew told peers: “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.”
Agnew insisted his resignation was “not an attack” on the Prime Minister.
Number 10 insisted the UK Government had been clear that fraud was “unacceptable” following Agnew’s resignation.
Anti-fraud minister Agnew told peers that “schoolboy errors” had been made as he set out his reason for resigning from the Government.
After finishing his speech, the Treasury minister walked out of the Lords chamber to applause from his fellow peers.
He told peers: “The oversight by both BEIS and the British Business Bank of the panel lenders of BBLs [Bounce Back Loan scheme] has been nothing less than woeful.
Agnew insisted his resignation was not an attack on the Prime Minister
“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 told the Lords that BEIS had “two counter-fraud staff” at the start of the pandemic who would not “engage constructively” with his counter-fraud team in the Cabinet Office.
He added: “Schoolboy errors were made, for example allowing over a thousand companies to receive bounceback loans that were not even trading when Covid struck.”
The Financial Times reports that more than £47 billion was awarded to more than £1.1 million small businesses under the Bounce Back Loan scheme [BBL].
Angew told peers that early estimates of fraudulent Covid loans were likely to be around 26% of the nearly £1bn which the government had paid out so far whilst reimbursing banks. The government had agreed to guarantee all BBL loans.
In response to a question about Covid loan fraud, Agnew told peers he was unable to defend the government’s record.
Agnew continued: “It is worth saying that none of this related to far more dramatic political events being played out across Westminster. 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.
“It matters for all the obvious reasons but there is a penny of income tax waiting to be claimed here if we just woke up. Total fraud loss across Government is estimated at £29 billion a year, of course not all can be stopped but a combination of arrogance indolence and ignorance freezes the Government machine.”
Responding, Labour leader in the Lords Baroness Smith of Basildon said: “I think we have just witnessed one of the most dramatic moments we have ever seen in the House from a minister who felt his integrity could no longer ensure he remained a member of the Government.”
Liberal Democrat Baroness 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.
“On a very personal level, I want to say how much we will miss Lord Agnew in his role, not least because of his integrity.”
No 10 insisted the Government had been clear fraud was “unacceptable” following the resignation of Lord Agnew.
The Prime Minister’s official spokesman 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, £500 million recovered last year and the HMRC tax protection taskforce is expected to recover an additional £1 billion of taxpayers’ money.”