5 billion given in error to the Covid furlough scheme and self-employed grants

According to a report from the National Audit Office, up to 5 billion in Covid pay-outs handed out in error through the furlough scheme and self-employed grants may never be recovered. This is a massive blow to the already strained finances of the UK government and will no doubt add to the growing public debt.

How this came about

When the pandemic struck, and Britain went into lockdown, £96.9billion was given to firms through furlough and grants to the self-employed to save them from going bust.

According to HMRC estimates, error and fraud in the two schemes could range from £3.2 billion to £6.3 billion. Of this, it is estimated that about £100 million might have been 'extracted' by organised crime gangs, mainly through hacking, while the majority was scammed by people who kept working when they were meant to be on furlough.

The NAO stated that "financial impact tests" should have been employed earlier to guarantee that Covid support money would go only to those who needed it. Several billion pounds have probably been given to claimants who experienced an increase in income during the said period. Although the figures are highly uncertain, it is unlikely that large amounts of error and fraud will ever be recovered.

What's next

This is a staggering amount of money, and the government has said it will "claw back" £1.1 billion of the lost cash by 2024, but it is hard to see how the government will ever be able to recoup such a considerable sum.

According to the report, unrecovered overpayments are estimated to fall between £2 billion and £5.1 billion.

This massive blow to the UK's finances will likely add to the deficit. It also raises questions about the government's ability to manage these complex schemes.


If you are concerned with the effect this may have on your business and your financial state, contact us for more information at enquiries@frostbr.co.uk

Back to all news
Get in touch
Thank you for your getting in touch with us, a member of our team will be in touch shortly.
Something went wrong while submitting the form, please get in touch with us using the phone number above to deal with your enquiry.
Operating nationwide throughout the UK

At Frost Group, we want to make things as easy as possible for you. That is why, if you can’t come to us, we’ll come to you. We operate face to face, nationwide meetings, wherever is most convenient for you.


Clockwise, Old Town Hall
30 Tweedy Road
Bromley, BR1 3FE


Court House,
Old Police Station South Street,
Ashby de la ZouchLE65 1BR


86-90 Paul Street

Proud members of

Authorised by

Frost Group Limited is authorised by the Financial Conduct Authority. Authorisation number 669247.