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Written evidence submitted by Protect

 

This is a short submission from the Whistleblowing Charity Protect.  This briefing will focus on the question is the Government doing enough to ensure that businesses and individuals are claiming appropriately and that fraudulent claims are detected?’.  We will be examining this question from the point of view of whistleblowing, and the experience of whistleblowers who have been trying to raise concerns about fraudulent activity within the Coronavirus Job Retention Scheme.

 

A short introduction to Protect

 

Protect is the UK’s leading authority on whistleblowing. For over 25 years the charity has run a legal advice service for whistleblowers from all sectors and industries and today receive over 3000 calls a year where the worker is unsure how or who to raise their concerns with. We use these experiences to inform the other activities of Protect namely offering consultation and training to assist organisations with their own internal whistleblowing arrangements. We are campaigning for better legal protection and improved arrangements for whistleblowers both in the UK and abroad.

 

Furlough Fraud and Whistleblowing

 

Whistleblowers have been contacting us in large numbers for advice on furlough fraud - we have received 216 furlough abuse cases to date, which is 54% of our total calls received on Covid-19 issues. A third of calls to our Advice Line in May and June have been about furlough fraud.  Below is a quick summary of some key themes of the calls we’ve received:

 

 

 

Workers being asked to work, volunteer or help-out while furloughed

Typically, cases tend to be focused on the whistleblower being asked to work, volunteer or assist their employer while being placed on the Furlough scheme. Other cases tend to be where the whistleblower discovers through their role in the organisation that other staff have been furloughed without their knowledge and while they are still working for the company. In some cases, workers have continued in their roles, only to discover at the end of the month when they receive only 80% of their pay that they have been furloughed.   We have had some cases where the worker has not received their payment in full – for example their pay has been reduced to 65%.

Many of our clients are concerned about the backlash if they raise their concerns.  Some have been moved sideways, threatened with dismissal if they refuse to work while furloughed, while others have been made redundant once they raise their objection to being forced to work.  Below are two case studies[1] from our advice line and has been taken from a blog post we have written on the issues:

 

 

 

 

 

 

 

In conclusion we have found that the whistleblowers contacting us for advice on furlough fraud work overwhelmingly in the private sector, for small employers and often asked quite brazenly to continue to work even though it is quite clear they are being furloughed.

 

We continue to have concerns with HMRC that without the telephone service, or online facility to discuss about the issues (they currently have an online form), many whistleblowers may decide not to come forward as some will want to ask questions around confidentiality or how their concerns will be investigated before raising their concerns, all of which are not easily answered in an online form.

 

The Government have committed to examine these things and open the line when it’s safe.[2]  We would like to see more detail on these plans published, and in the meantime for some sort of secure chat function to be provided for whistleblowers.

 

Enforcement- using the information provided

 

Given the scale of the concerns being reported to us on the Advice Line, and the 1900 concerns raised with HMRC reported in the media over the last few weeks we welcome the new powers to recover fraudulent payments being made under the scheme being considered in the Finance Bill. 

 

However, we are seeking assurances that such powers will not be used against whistleblowers who, though they have reported such fraud, have received these payments under the scheme.  Whistleblowers who speak out on furlough fraud should not be penalised with having to pay back monies which have been fraudulently claimed by their employer. We would like to see a similar commitment that whistleblowers will not be pursued for repayment of furlough money that HMRC have issued in relation to company directors who make “genuine mistakes” but instead focus penalties against directors who commit "deliberate non-compliance".

 

 

In summary

We believe that HMRC need to put in place the following things:

 

 

June 2020

 


[1]The names of the whistleblowers have been changed.

[2] https://www.theyworkforyou.com/wrans/?id=2020-06-15.HL5737.h&s=speaker%3A10642#gHL5737.q0