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CIPD responds to HMRC action on furlough fraud

The CIPD welcomes HMRC's measured and reasonable approach to identifying and tackling misuse of the furlough scheme

The CIPD has responded to the news that HMRC has identified 27,000 high-risk claims to the Coronavirus Job Retention Scheme, where employers may have inadvertently or fraudulently claimed too much or wrongly. 

HMRC says employers who have made an honest mistake will be given the opportunity to work with them to put it right, and has published guidance on steps to take if a claim has been wrong. 

Employers who do not take this opportunity to correct any wrong claims will be pursued through one-to-one investigations and can expect tough action if wrongdoing is uncovered. The expectation is that 10,000 of these will be followed up in this way. 

Peter Cheese, Chief Executive of the CIPD, said:  

“The HMRC is taking a measured and reasonable approach to identifying and tackling misuse of the furlough scheme, recognising that in many instances where there have been inappropriate claims, employers have made honest mistakes due to its complexity and evolution - and that seeking to work with them to address these is the best way forward. 

“However, it is also right that HMRC proactively investigates cases where there is suspected fraud and takes a much harder line with the imposition of penalties and criminal investigation where appropriate.” 

“The scheme required trust in employers, and employees, doing the right thing and businesses must show that they acted with integrity. It is concerning that HMRC believe as much as 10% of what was paid out on the scheme may be incorrect, which not only may have immediate financial implications for some, but also reputational issues that may be more lasting.  In these challenging and uncertain times, it is even more imperative that businesses act responsibly for the good of all their stakeholders. It is important that the furlough scheme has been used by employers as intended since it was introduced.”  

The CIPD has worked closely with HMRC to provide information and guidance for members on the furlough scheme on our Coronavirus Hub throughout the pandemic. We will be providing further support to help members identify any errors and take action to rectify them. 

Original article link: https://www.cipd.co.uk/about/media/press/furlough-fraud

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