Treasury minister Lord Agnew of Oulton has resigned from the government over how it has handled fraudulent Covid business loans.
He surprised peers on Monday by outlining his unhappiness with working between the Department for Business, Energy and Industrial Strategy (BEIS) and the Treasury.
Once he had finished his speech, Agnew slammed his folder shut, said “thank and goodbye”, and immediately left the chamber to applause.
He had been required to appear before peers to update them about the £4.3 billion of Covid loans – written off by the Treasury – which Labour said has gone to “fraudsters”.
Agnew agreed the Treasury had prioritised the speed of distributing funds, but added: “What has followed has been nothing less than desperately inadequate.”
He criticised the “woeful” oversight of the bounce back loans by BEIS and the British Business Bank of the panel lenders, adding: “They have been assisted by the Treasury, who appear to have no knowledge or little interest in the consequences of fraud to our economy or our society.”
The Conservative peer said BEIS had “two counter-fraud staff” at the start of the pandemic who would not “engage constructively” with his counter-fraud team in the Cabinet Office.
He went on: “Schoolboy errors were made, for example allowing over 1,000 companies to receive bounce back loans that were not even trading when Covid struck.”
Agnew said he had been “arguing” with Treasury and BEIS officials for nearly two years to “get them to lift their game”, adding: “I have been mostly unsuccessful.”
He went on to raise further concerns, including over duplicate loans and an apparent lack of ability to scrutinise the performance of lenders.
Agnew said he had outlined his “deeply held conviction that the current state of affairs is not acceptable”.
He added: “Given that I am the minister for counter-fraud, it would be somewhat dishonest to stay on in that role if I am incapable of doing it properly, let alone defending our track record.
“It is for this reason that I have sadly decided to tender my resignation as a minister across the Treasury and Cabinet Office with immediate effect.”
He passed his letter to a frontbench colleague.
Shadow chancellor Rachel Reeves said Agnew’s resignation was a “damning indictment of the chancellor and the government’s failures on fraud”.
She said: “That the government’s own anti-fraud minister feels he is unable to defend the government’s record on billions of pounds of taxpayer cash gifted to criminals tells you all you need to know about the incompetence of this government.
“It should be a source of enduring shame to the Chancellor that he has so casually written off £4.3 billion of taxpayers’ money that is now in the hand of criminals and gangs.”