The level of influence of special advisers when deciding which charities would receive Covid support money “appears to go beyond” what would be expected and there was no clear rationale on why consultants were paid £2 million to assess the bids, MPs have said.
A Commons committee has found it was unclear why some charities were bumped up from the lowest priority for funding after involvement from special advisers, who hold a political role.
It also questioned why some organisations received money at all considering officials were unsure if they were actually “eligible for Government funding in the first place”.
The Commons Public Accounts Committee (PAC) said while the Department for Digital, Culture, Media and Sport (DCMS) paid the majority of its £513 million coronavirus support package out to charities, voluntary groups, and social enterprises quickly, there were concerns over “a notable opaqueness over some aspects” of decision making.
A report said it was “unclear what influence special advisers had over some funding decisions, with some charities awarded Government funding despite the department’s officials initially scoring their bids in the lowest-scoring category, including four out of the five lowest-scoring applications”.
Appearing in front of MPs from the committee in April, DCMS permanent secretary Sarah Healey had insisted seeking views from special advisers, who are political appointees hired to support ministers, was “very normal” and that final advice had been from impartial civil servants, but admitted the process had been “truncated” for speed.
However, the PAC report found: “The level of influence exerted by special advisers and their involvement at the point of decision making appears to go beyond what we have previously seen as members of this committee or in our previous ministerial roles.”
DCMS also paid consulting firm PwC £2 million “for specialist support on data collection, analytical support and due diligence, including checks on all award decisions”.
The National Lottery Challenge Fund, which was helping to distribute the funding, was already confident in having the right checks in place.
The PAC report said DCMS had “failed to provide a clear rationale” for this “when established processes were already in place to do this”.
The department also had “no information on where in the country 18% of the funds awarded are actually being used, equivalent to £101 million of taxpayers’ money and 2,882 funding awards”.
Meg Hillier MP, chairwoman of the committee, said: “The PAC has seen these twin themes recur throughout the policy response to Covid, especially when it comes to disbursing funds.
“One is a worrying smoke thrown up around award decisions, with growing instances of the official processes overridden without adequate explanation.
“The other is the focus on inputs not outcomes, on getting money spent – including exorbitant amounts on consultants – without factoring or measuring the impact. I fear one clear impact is the steady erosion of taxpayers’ trust that their money is being well spent in this national emergency.”
A DCMS spokeswoman responded: “The DCMS permanent secretary has confirmed that all decisions on this funding followed proper due process and were in line with the Civil Service Code and the Code of Conduct for Special Advisers.
“All decisions were made by ministers based on advice from officials and special advisers did not unduly influence this in any way.
“External grant and fund management support allowed the department to meet tight deadlines and safely distribute funds across the full package of support offered.”