The Government worked quickly to introduce financial support for rising energy bills currently estimated to have cost £69bn), recognising it had to make compromises to do so such as support going to households that did not need it, a National Audit Office report has found.
In common with COVID-19 support schemes, energy bills support was designed to be applied universally and at speed says the report adding that the Government acknowledged that this creates value for money risks by providing support to homes and businesses that do not necessarily need it.
The government has announced that it will reduce support for non-domestic organisations from April 2023, but that energy and trade intensive sectors will receive a higher level of support than other sectors.
Targeting future support, whether at firms or households, will reduce value of money risks but will present a fresh challenge for in verifying claims and identifying potential fraud.
The Government,it says, will need to consider the likely losses to fraud and error, alongside the improvements in value for money from reduced deadweight, that could result from increased targeting.
Gareth Davies, the head of the NAO said:
Similar to the government’s assistance during COVID, the energy bills support schemes were introduced universally, and at speed, to reduce the impact of soaring energy costs for people and businesses.
“This approach led to compromises – introducing these interventions at speed meant that BEIS has less time to consider fraud and error risks; and their universal nature meant that a significant number of households received financial support they did not need’.
“As the government seeks to target future assistance, it must be mindful of the risk of introducing complexity which could aid fraudsters. The National Audit Office will continue to monitor these schemes to understand their impact, particularly the costs and benefits of universal versus targeted support.”
