THE GUARDIAN: Name the firms that got state-backed Covid-19 loans
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The UK public have a right to know who the recipients of £50bn of government-backed coronavirus loans are. By not releasing details of the 1.2-million businesses that accessed cheap, guaranteed state funding, ministers are leaving the government open to accusations that it has something to hide.
This charge is easier to make because the default setting of Boris Johnson’s government has been secrecy. Only when ministers have been taken to court have they been forced to reveal details of public contracts awarded under emergency rules. The three contracts so far made public represent a sliver of the hundreds signed to procure £15bn of personal protective equipment to protect frontline staff. But they already tell a story, according to the Good Law Project, of “staggering sums of money, political connections, vast waste on duff product — and most of all a lack of transparency”.
It is understandable that the government wished to support businesses during the lockdown, so that they could weather the storm of the pandemic. But 1.17-million loans worth £35.5bn have been approved under the “bounce-back” scheme, which is aimed at small and medium-sized enterprises and comes with a 100% state guarantee. There are only about 1.4-million UK private-sector businesses with employees. That 80% of UK businesses apparently took advantage of self-certified loans that were granted in 24 hours and for which the state was wholly liable, should have rung alarm bells. There are questions over the nature and extent of the due diligence required by the Treasury and the banks.
Former US supreme court justice Louis Brandeis once noted ( that sunlight is the best disinfectant, but electric light the most efficient policeman. The public must be able to see if state cash went to politically connected insiders or was siphoned off into tax havens. Anticorruption campaigners, led by the Fraud Advisory Panel, warned that without transparency there was a real risk the money would be diverted to fraudsters and that the ease of obtaining loans could see a repeat of the subprime mortgage scandal in the banking system./London, August 24
This charge is easier to make because the default setting of Boris Johnson’s government has been secrecy. Only when ministers have been taken to court have they been forced to reveal details of public contracts awarded under emergency rules. The three contracts so far made public represent a sliver of the hundreds signed to procure £15bn of personal protective equipment to protect frontline staff. But they already tell a story, according to the Good Law Project, of “staggering sums of money, political connections, vast waste on duff product — and most of all a lack of transparency”.
It is understandable that the government wished to support businesses during the lockdown, so that they could weather the storm of the pandemic. But 1.17-million loans worth £35.5bn have been approved under the “bounce-back” scheme, which is aimed at small and medium-sized enterprises and comes with a 100% state guarantee. There are only about 1.4-million UK private-sector businesses with employees. That 80% of UK businesses apparently took advantage of self-certified loans that were granted in 24 hours and for which the state was wholly liable, should have rung alarm bells. There are questions over the nature and extent of the due diligence required by the Treasury and the banks.
Former US supreme court justice Louis Brandeis once noted ( that sunlight is the best disinfectant, but electric light the most efficient policeman. The public must be able to see if state cash went to politically connected insiders or was siphoned off into tax havens. Anticorruption campaigners, led by the Fraud Advisory Panel, warned that without transparency there was a real risk the money would be diverted to fraudsters and that the ease of obtaining loans could see a repeat of the subprime mortgage scandal in the banking system./London, August 24
