Information on thousands of small businesses that received taxpayer-backed loans during Covid-19 will remain confidential, after a tribunal blocked an anti-corruption campaign group’s bid to obtain the data through a Freedom of Information (FoI) request.
The First Tier Tribunal blocked Spotlight on Corruption’s bid to force the UK government into publishing the names of all firms that received money through the government’s four Covid support schemes, amid concerns the country’s Covid support schemes had been exploited by fraudsters and organised criminals.
The tribunal’s decision, published yesterday, means data on almost all of the companies that used the UK’s £47bn Bounce Back Loan Scheme (BBLS) will remain secret. The BBLS offered state-backed, zero-interest loans to small and medium enterprises (SMEs) of £2,000 to £5,000, which must be paid back over a period of six year.
As of yet, the UK government has only published limited information on companies that took support, based on the sums those companies received.
Prior to the UK’s exit from the European Union, the government was forced to reveal information on firms that took sums of more than €100,000. The UK government later upped threshold to £500,000 after the end of 2020. The situation means only 2.4 per cent of companies that took loans through the UK’s BBLS scheme have been revealed thus far.
In launching its appeal, Spotlight had sought to overturn a decision by the UK’s Information Commissioner’s Office (ICO) to let the British Business Bank (BBB) keep the information secret, after the campaign group submitted a Freedom of Information (FoI) request in 2020.
The BBB initially refused Spotlight’s request on 12 August 2020, in claiming the information should be exempt from being requested under Section 43 of the FoI Act 2000, which protects commercial interests.
In seeking to overturn the BBB’s decision to keep the information secret, Spotlight later referred the state-backed bank’s decision to the ICO on 23 October 2020. The ICO however rejected Spotlight’s request to overturn the BBB’s decision.
A tribunal on Wednesday, however, rejected Spotlight’s bid to overturn the ICO’s decision, after the campaign group filed an appeal against the information watchdog’s decision on 14 February 2022.
The tribunal ruled that any public interest in revealing the companies’ names is outweighed by the public interest in protecting their identities.
The tribunal also raised concerns that by revealing companies’ names it could expose those firms to being targeted by fraudsters, as it dismissed Spotlights’ appeals.
The ruling follows the UK government’s decision to write off £4.3bn of the £5.8bn worth of fraudulent payments handed out through the country’s Covid business support schemes.
Spotlight on Corruption researcher George Havenhand said the group was “disappointed that the Tribunal’s emphasis on commercial confidentiality overshadowed wider considerations, particularly given that it recognised the extremely high public interest in transparency and scrutiny of the Covid loan schemes.”
Havenhand warned that billions worth of losses potentially could have been avoided if the names had been published back in 2020.
“The fraudsters who used these schemes to rip off billions of pounds from their fellow citizens at a time of national emergency face little chance of being investigated, let alone convicted,” he said.
“The National Investigation Service has so far made only 49 arrests into Bounce Back Loan Scheme fraud and opened investigations with a total value of £160 million – a fraction of the amount lost to fraud,” he added.
“If we’re to stop the public purse from being similarly robbed in future state aid schemes, the government needs to learn hard lessons from this debacle fast,” Havenhand said.
A British Business Bank spokesperson said: “We welcome today’s decision by the Tribunal. We will continue our focus within the Bank on supporting and helping to grow smaller businesses in the UK now, and in the future.”
An ICO spokesperson said: “We acknowledge the Tribunal’s judgment and are considering the details.”
A spokesperson for the Federation of Small Businesses (FSB) welcomed the tribunals decision in claiming that allowing businesses to ” keep their privacy is the right decision, avoiding being targeted wantonly for borrowing money that they are now paying back.”
“They each applied for relatively small amounts of money through finance providers with whom they already had an existing relationship in the vast majority of cases,” the FSB spokesperson said.
For all the latest Lifestyle News Click Here
For the latest news and updates, follow us on Google News.
