Response to pandemic has ‘exposed the taxpayer’

The Public Accounts Committee has said that the government’s response to the pandemic has exposed the taxpayer to ‘significant financial risks for decades to come’.

With the estimated lifetime cost of the government’s measures reaching £372 billion in May 2021, MPs say that the taxpayer is ‘already on the hook’ for an estimated £26 billion of credit and fraud losses in the SME bounce back loan scheme.

The committee has again blasted the government over its record o0n PPE supplies, saying that the current stockpile is not fit for purpose. Of 32 billion items of PPE ordered by the Department of Health & Social Care as of May 2021, 11 billion have been distributed, 12.6 billion are stored in the UK as central stock, and 8.4 billion on order from other parts of the world have still not arrived in the UK.

The current stockpile is costing the department approximately £6.7 million a week to store and potential waste levels are ‘unacceptably high’. According to the PAC, with 10,000 shipping containers of PPE still to be unpacked by May this year, 2.1 billion items of PPE had already been found unsuitable for use in medical settings - equating to over £2 billion of taxpayers’ money and over five times the estimate of PPE unfit for purpose given to the committee by DHSC in January 2021.

Of equal concern, for the excess PPE that is suitable for medical use, the Government is yet to create any robust plans for repurposing and distributing this essential stock in a way which ensures value for money and protects staff and patients.

The committee also says that a lack of clarity and timeliness and the volume of government communications has hindered the public’s understanding of public health guidelines and ability to comply with them. The government inquiry is expected to start in spring 2022 and will take years to complete – the PAC is ‘clear that government cannot wait for the review before learning important lessons’. The committee expects the government to ‘set out a fully costed plan for recovering from the Covid-19 pandemic’ in the autumn Spending Review, alongside a comprehensive framework for managing the risks to public finances resulting from the Covid-19 response.

Dame Meg Hillier, chair of the Public Accounts Committee, said: “With eye watering sums of money spent on Covid measures so far the government needs to be clear, now, how this will be managed going forward, and over what period of time. The ongoing risk to the taxpayer will run for 20 years on things like arts & culture recovery loans, let alone the other new risks that departments across government must quickly learn to manage.

"As well as monitoring procurement and its effectiveness through the next few years, the PAC will be watching this spending and risk for decades to come. If coronavirus is with us for a long time, the financial hangover could leave future generations with a big headache."