In the year to 31 March 2021, HMRC paid out £61bn under the furlough scheme. During the same period, just 3,578 furlough claims were blocked, totalling £28.5m.
It is estimated that £5.3bn was paid out due to fraud or error, and HMRC has stated that much of the fraud that took place was ‘difficult to detect upfront’, such as employers claiming furlough money for employees who actually continued to work whilst on furlough.
In a statement to ‘Accountancy Daily’, an HMRC spokesperson said: ‘We were clear from the outset that the Coronavirus Job Retention Scheme would be targeted and that a small minority would seek to exploit the scheme.
‘The schemes had compliance designed into them from the start, for example by using existing processes and verifiable data in order to minimise the risk of fraud and error. This proved critical in our ability to block claims from, for example, fictitious companies which we knew to be attempted fraudulent claims.’
HMRC is now looking to recoup the fraudulently claimed furlough money, and expects to recover £1bn over the next two years, on top of the £500m already recovered.