British taxpayers are facing the sobering reality of nearly £11 billion lost to fraud and error in Covid-19 support schemes, as a major new report lays bare the cost of pandemic-era mismanagement. According to findings to be presented to members of Parliament on Tuesday, December 9, 2025, by Covid Counter Fraud Commissioner Tom Hayhoe, fraudsters exploited a "golden opportunity" created by hastily designed government programmes intended to prop up the economy during unprecedented lockdowns. The report’s revelations, first highlighted by the BBC and Sunday Mirror, are already sending shockwaves through Westminster and the public alike.
The scale of the losses is staggering. The £10.9 billion figure—attributed to both outright fraud and administrative error—covers a range of Covid-era policies launched by Boris Johnson’s Conservative government, including the furlough wage subsidies, 'bounce-back' loans, the Eat Out to Help Out scheme, and one-off business grants. These programmes, while credited with averting economic catastrophe for millions, are now under fire for the lack of basic anti-fraud controls and eligibility checks that left the door wide open to exploitation.
Commissioner Hayhoe’s report pulls no punches. It singles out the rushed rollouts and lack of foresight: “Accepting a high level of fraud risk, without plans for managing or mitigating this risk,” the report states, according to BBC. The result? A situation described by a government source as so lax, “they may as well have left the door wide open.” Fraudsters, it seems, had an open invitation.
To put the numbers in perspective, the £10.9 billion lost could have funded daily free school meals for the UK’s 2.7 million eligible children for eight years—covering every child from reception until the age of twelve. Instead, critics argue, the money slipped through the government’s fingers at a time when families across the country were struggling to make ends meet.
The political fallout has been swift and fierce. Anna Turley, Chair of the Labour Party, did not mince words: “Britain is still paying the price for the Tories' complete failure to prevent Covid fraud during the pandemic. Kemi Badenoch's Conservatives need to finally apologise and explain to the public why they chose to expose their hard-earned cash to exploitation by fraudsters.” She added that the current Labour government is “determined to keep recovering taxpayers' money lost to Covid fraud, with over £400 million already back in the Treasury.”
Chancellor Rachel Reeves, who tasked Hayhoe with leading the effort to retrieve the lost cash, has implemented a multi-part probe into pandemic-era spending. The first phase uncovered £1.4 billion wasted on substandard personal protective equipment (PPE)—including gowns, masks, and visors—much of which was never inspected for years, rendering public money unrecoverable. According to Sunday Mirror, more than half (52%) of the surgical gowns procured were non-compliant, and vast quantities of protective equipment were left to languish in shipping containers due to a lack of storage space. By the time the surplus kit was finally checked, warranties had expired, making it impossible to claim refunds.
So far, the government has managed to recover only £182 million from these failed contracts, with some suppliers referred to the National Crime Agency for suspected fraud. The Agency is now investigating possible criminal offences committed within the PPE procurement system, a process that could take years to fully play out.
The government’s legal battles have not been limited to nameless suppliers. In a high-profile case, authorities won a court fight against PPE Medpro—a company linked to Baroness Michelle Mone and her husband, businessman Doug Barrowman—over a contract to supply 25 million surgical gowns. The firm was ordered to repay more than £121 million for breaching the contract, though both Baroness Mone and Barrowman have denied any wrongdoing.
With the extent of the losses now public, the government is scrambling to claw back as much money as possible. In September 2025, a voluntary repayment scheme was launched, giving individuals and businesses who wrongly claimed Covid support funds the chance to return the money with no questions asked until the end of December. The initiative is part of a broader crackdown, which also includes a new “hit squad” empowered to fine offenders 100% of the value of their ill-gotten gains, block fraudulent claimants from becoming company directors, and refer them for criminal investigation.
Hayhoe’s report is expected to argue that the pandemic’s urgency does not excuse the lack of planning. The government’s willingness to accept a high level of fraud risk, without adequate measures to manage or mitigate that risk, is at the heart of the problem. According to Upworthy, these failings created what Hayhoe calls a “golden opportunity” for fraudsters to exploit the system at the public’s expense.
Supporters of the previous Conservative government counter that the speed and scale of the crisis left little room for perfect safeguards. The economic support programmes, they argue, were designed to prevent mass unemployment and business collapse under extraordinary circumstances. Without the furlough scheme, bounce-back loans, and grants, the UK might have faced even deeper recession and social hardship.
Yet, for many, the question remains: could more have been done to protect public funds while still responding rapidly to the pandemic? The answer, at least according to Hayhoe’s findings and the chorus of critics, is a resounding yes. As one Labour source put it, “Whilst NHS workers put themselves on the front line to save lives, the Tories lined the pockets of fraudsters who used a national emergency to rip off the government. Finally this report will lay bare the true scale of their failure.”
The government insists it is committed to recovering as much of the lost money as possible. “We are getting our money back, and we will put it where it belongs—in our schools, our hospitals and our communities,” the Labour source added. The voluntary repayment scheme, new investigative powers, and ongoing criminal probes all form part of a concerted effort to right the wrongs of the past.
For the public, the revelations are a bitter pill to swallow. The pandemic was a time of collective sacrifice, and the idea that billions were siphoned off by fraudsters—enabled by government oversight failures—has understandably sparked outrage. As the dust settles, the coming months will reveal just how much of the lost billions can be recovered, and whether the lessons of the pandemic will lead to more robust safeguards in future crises.
For now, the Hayhoe report stands as a stark reminder of the high cost of haste, and the enduring importance of vigilance when public money is at stake.
