United Kingdom: Public Accounts Committee reports on the Bounce Back Loan Scheme (2020 and 2022)
- Parliament
- House of Commons, United Kingdom 1
- Committee
- Committee of Public Accounts 1
- Earlier report
- Covid-19: Bounce Back Loan Scheme, Thirty-Third Report of Session 2019-21, HC 687, published 16 December 2020 4
- Audit relied on
- National Audit Office, The Bounce Back Loan Scheme: an update, HC 861, 3 December 2021 5
- Government response
- Treasury Minute in CP 722. The document is dated July 2022 2. The committee lists it as published on 2 September 2022 3
- Outcome status
- 5 sub-recommendations marked implemented, 8 agreed with target dates, 1 disagreed, per CP 722 2. Later status: no public record found as of 22 October 2026
The scheme and the two reports
The committee's first report, published on 16 December 2020, said over 1.4 million loans worth £42.2 billion had been made by 15 November 2020 4. It cited estimated fraud and credit losses "in the region of £15 billion to £26 billion" 4. It relied on the NAO's Investigation into the Bounce Back Loan Scheme, HC 860, dated 7 October 2020 4.
The follow-up report of 27 April 2022 says the scheme provided 1.5 million loans worth £47 billion 1. It gives an estimated total loss of £17 billion from credit and fraud, and an estimated fraud loss of £4.9 billion 1. The NAO update of 3 December 2021 gives £4.9 billion as the government's "most likely" estimate of fraudulent loans, which matches the committee's figure 5. The committee says the Department estimated that between 31% and 48% of loans will not be repaid 1.
The recommendations as numbered in the follow-up report
The report has seven numbered recommendations, addressed to the Department for Business, Energy and Industrial Strategy (the Department) and the British Business Bank (the Bank) 1. The Treasury Minute splits several into parts a and b 2.
| No. | Recommendation (summary, with committee wording) | Deadline set by the committee |
|---|---|---|
| 1 | The Department should "put in place a clear strategy to manage the long-term legacy of the Scheme". The Bank should write on how it will measure long-term impact, with a control group 1 | Within a month of the evaluation report, then of the strategy 1 |
| 2 | The Department should set out the increase needed in counter-fraud resources across government, and explain how it will improve its loss estimates 1 | Within 3 months, and in the Treasury Minute 1 |
| 3 | For any future emergency scheme, the Department should be explicit on "the level of fraud it is prepared to tolerate from the outset", and include anti-fraud measures from the start 1 | None stated 1 |
| 4 | The Department should set out how it will use legal, regulatory and contractual incentives to improve lenders' performance, and report on individual lender performance 1 | In the Treasury Minute 1 |
| 5 | The Department should set out its strategy for collecting overdue payments after lenders' 12-month recovery period, and give data on lender claim times 1 | In the Treasury Minute 1 |
| 6 | The Bank should develop a strategy to reduce the scheme's effect on the SME lending market, and the Department should identify unintended consequences 1 | Next Small Business Finance Market report 1 |
| 7 | The Department and the Bank should set a strategy to share lessons, and the Bank should develop a business case for an emergency loan scheme for future crises 1 | Within a month of the first evaluation, and within 6 months 1 |
Government response
The government replied in Treasury Minutes CP 722, which covers the Forty-Ninth to Fifty-Second reports of Session 2021-22 and three reports of Session 2022-23 2. The document is dated July 2022 2. The committee's website lists the Treasury Minute as published on 2 September 2022 3. This page gives both dates.
On recommendation 7b, the business case for a future emergency loan scheme, the minute says: "The government disagrees with the Committee's recommendation." 2 On 6b, the government said the SME lending market had been restored to its pre-pandemic state and marked the recommendation implemented 2.
| Part | Government position | Target date or status in CP 722 |
|---|---|---|
| 1a | Agrees 2 | Autumn 2022 2 |
| 1b | Agrees 2 | Summer 2022 2 |
| 2a | Agrees 2 | Autumn 2022 2 |
| 2b | Agrees 2 | Recommendation implemented 2 |
| 3a | Agrees 2 | Recommendation implemented 2 |
| 3b | Agrees 2 | Autumn 2022 2 |
| 4a | Agrees 2 | Recommendation implemented 2 |
| 4b | Agrees 2 | Recommendation implemented 2 |
| 5a | Agrees 2 | Winter 2022 2 |
| 5b | Agrees 2 | Summer 2022 2 |
| 6a | Agrees 2 | Spring 2023 2 |
| 6b | Agrees 2 | Recommendation implemented 2 |
| 7a | Agrees 2 | Summer 2022 2 |
| 7b | Disagrees 2 | None 2 |
Outcome as of 22 October 2026
The committee's inquiry page lists two later letters on the report 3. One is from Sarah Munby, Permanent Secretary at the Department, dated 30 November 2022, on the Treasury Minute response 3. The other is from Louis Taylor, Chief Executive of the British Business Bank, dated 30 November 2023 3. Their contents were not read for this page.
HM Treasury publishes Treasury Minutes Progress Reports on open recommendations. This page could not read the text of those reports, so the later status of the agreed parts is not given here.
- 2b, 3a, 4a, 4b, 6b: Implemented, according to the government in CP 722 2. The committee's own view was not found.
- 1a, 1b, 2a, 3b, 5a, 5b, 6a, 7a: Pending in CP 722, with target dates from Summer 2022 to Spring 2023 2. No public record of closure found as of 22 October 2026.
- 7b: Not implemented. The government disagreed in CP 722 2.
Common questions
How much was lent under the Bounce Back Loan Scheme?
About £47 billion in 1.5 million loans, according to the committee's April 2022 report 1.
How much was lost to fraud?
The government's most likely estimate was £4.9 billion of fraudulent loans, as cited by the NAO in December 2021 5 and by the committee 1.
Which recommendation did the government reject?
Recommendation 7b, that the British Business Bank develop a business case for an emergency loan scheme for future crises 1,2.
When did the government respond?
In Treasury Minutes CP 722, dated July 2022 and listed by the committee as published on 2 September 2022 2,3.
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Sources
- Committee of Public Accounts: Bounce Back Loans Scheme: Follow-up, Fiftieth Report of Session 2021-22, HC 951 (27 April 2022)
- HM Treasury: Treasury Minutes, Government response to the Committee of Public Accounts, CP 722 (July 2022)
- UK Parliament: Bounce Back Loans Scheme: Follow-up, inquiry publications page
- Committee of Public Accounts: Covid-19: Bounce Back Loan Scheme, Thirty-Third Report of Session 2019-21, HC 687 (16 December 2020)
- National Audit Office: The Bounce Back Loan Scheme: an update, HC 861 (3 December 2021)
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