Here’s how Labour can make Britain a hostile environment for fraud

Keir Starmer made a speech in Gateshead on Monday, telling his audience: “When I say decency and honesty matter, that means being honest about how we fund every single thing we promise you.” He committed Labour to explain every pound of its pledges for the next general election, leading with a pitch on Labour’s plans for wealth creation. Part of this strategy for economic growth must include a plan to better tackle fraud through a zero-tolerance approach.

Britain was named the fraud capital of the world last month, with total losses amounting to £3bn. Around 40 million people in the UK have been targeted by scammers. But only 2% of the police are investigating what has been described as a “crime plague“. Fraudsters stole £700m in April alone, a worrying upward trend from £200m a month in 2021. The UK now has the highest levels of credit and debit card fraud in Europe by far. But only one in 1,000 reports of fraud last year resulted in a charge.

These damning statistics make clear that this is a major problem plaguing our country, which has worsened to record levels under the Tories. 12 years of Conservative government have built Britain up as the world’s capital for fraud, with all the damaging consequences for tackling crime, protecting the economy and our global reputation. It has made the cost-of-living crisis even worse for victims.

The Tories’ failure to tackle fraud is no one’s fault but their own – despite what they might want us to believe. In its annual report earlier this year, HM Revenue and Customs said funds lost to fraud included 2.5% of the £19.7bn delivered through coronavirus support. This £4.3bn of fraud was reportedly written off by former Chancellor now Tory leadership candidate Rishi Sunak – something he has, of course, denied. The dire situation led his then Treasury minister Lord Agnew to resign spectacularly at the despatch box in the House of Lords, accusing the Treasury of having “little interest in the consequences of fraud to our society” and making “schoolboy errors” in awarding loans.

The rise in fraud cases has driven up crime figures. In seeking to promote a knowingly false view of crime statistics, the government has claimed that crime is actually falling – but only if you don’t count fraud. Unsurprisingly, the statistics watchdog was quick to issue a rebuke of the government (and not for the first or last time). When challenged earlier this year on the government’s failure to take action against fraud, Business Secretary Kwasi Kwarteng said fraud was not a “crime that people experience in their day-to-day lives“. He could not have shown better how completely out of touch this government is with most people’s everyday lives.

I recommend that Labour make Britain a hostile environment for fraud. One part of this approach should be a commitment to not writing off the £4.3bn of fraud relating to coronavirus support. While it may be difficult to identify those defrauding the public because of Sunak’s ‘schoolboy errors’, the government should do everything in its power to safeguard public money. The Tories have been too careless. Labour can show we are different through a zero-tolerance approach.

This approach might be underpinned by creating a statutory requirement – putting our commitment into law – that the government will pursue all suspected fraud cases. The contrast with the Conservatives couldn’t be made clearer. They allowed record fraud on their watch – and it continues to rise, fuelled by writing off billions that should be reclaimed and used to help support tax relief or improve public services.

Perhaps the Tories might say they are committed to tackling fraud, too. Of course, none of us want to see crime rise. But Labour can show a more sincere commitment – at a time when public trust in the government is at record lows – by putting our approach into law. Under my recommendation, it would not be an option that any level of fraud could be simply written off and disregarded. Under the Tories, it can be and it has been.

A second part of my approach would see Labour consider the appointment of an anti-fraud tsar. This would be someone in government to support the Serious Fraud Office, the National Crime Agency’s Economic Crime Command, the City of London Police, UK police forces and regional organised crime units, HM Revenue and Customs, the Financial Conduct Authority and the National Economic Crime Centre. The tsar would ensure cross-departmental cooperation with these bodies across HM Treasury, the Home Office and the Ministry of Justice in a more joined up, concerted effort to bring fraud down. Clearly, there must be a step change to improve effectiveness and ensure that the government is able to do all it can to tackle these crimes.

Labour’s recommended zero tolerance to fraud could be a meaningful message that sticks, reinforcing a rightly tougher line on reducing these crimes while also strengthening our message that we are a safer pair of hands on the economy. It would show a commitment to security by protecting the public, to prosperity by better safeguarding public money and to respect by upholding the rule of law and promoting fairness. In these ways, a zero-tolerance approach to fraud fits with the Labour Party’s values of security, prosperity and respect outlined by Starmer in his contract with the British people. (I have shown elsewhere how these values relate to other home affairs issues like immigration.)

Moreover, tackling fraud could play an important part in how Labour makes the most of post-Brexit opportunities. As outlined in Starmer’s keynote speech on July 4th, Labour will “make Brexit work”. Labour should support this commitment by backing tougher anti-fraud standards. This is exactly the right approach, taking action against all those who benefit from fraud including organised crime and others. As Starmer noted, as Director of Public Prosecutions, he understands the need for new security arrangements to bring crime down and defend the public. This proposal is one means of doing so in our post-Brexit reality that the public badly needs – and which will also help grow the economy in a sustainable, healthy way, as Starmer outlined today.

Tackling crime is about more than bobbies on the beat. Labour must have a fit-for-purpose approach that addresses the pressing needs of the public. My proposed zero-tolerance approach to fraud does just this and should be considered to make Britain work better.