Sheffield Council handed out more than £500,000 in 'invalid' Covid grants

A report on fraud to councillors revealed the local authority is still trying to recover all of the 44 grants, totaling £555,000.

The report, produced on request of the audit and standards committee, said: “The key consideration was to make the payment to individuals as quickly and as simply as possible to support the keep economy and maintain jobs.

“These grants were ‘rushed out’ and, in some instances, the detailed conditions were received after the payments were made. There was little opportunity to undertake testing at the time.

"This was compounded by the fact that officers were working from home and did not have full access to all of the relevant systems.

“Consequently retrospective checking was undertaken to identify any erroneous payments.”

In total, across three Covid support schemes 8,244 grants were paid out amounting to more than £98 million.

Of those so far, 44 were found to be invalid with a sum value of £555,000.

The anomalies were not classed as fraud as the council said there “may well have been issues with the processes used”.

Nearly half were followed up since and now 26 grants totaling £305,000 remain outstanding.

Shortly after the start of the schemes, the council was asked for a digital reporting tool to be completed monthly. This examined 174 applications valuing £2 million and no evidence of systematic or organised crime fraud was detected.

Stephen Bower, finance manager at the council, presented the report on fraud to the committee during a recent meeting.

He said fraud was a “real boom industry” that in the UK hit £130 billion in 2019, rising by 50 per cent in about a decade.

The report said: “The Internal Audit service is well aware that the vast majority of people both within and outside the council will be rallying round in the time of national crisis to ensure that services are maintained and that business can function in an efficient and ethical manner.

“However it is important to note that some individuals and criminal organisations will look upon this crisis as an opportunity to try to undertake fraudulent activity.

"It has been noted that some ‘gangs’ have targeted loans administered by central government on an industrial scale.”

In these confusing and worrying times, local journalism is more vital than ever. Thanks to everyone who helps us ask the questions that matter by taking out a digital subscription or buying a paper. We stand together. Nancy Fielder, editor.