Consultants paid millions to help award Covid cash to charities for no obvious reason, MPs find

Ministers paid millions of pounds to consultants over payment of Covid funds to charities for no clear reason, an influential group of MPs has found, as they warned that a “worrying smoke” had been thrown up around awards.

In a damning report, the Commons Public Accounts Committee (PAC) also said it was unclear what influence special advisers had over some funding decisions.

Ministers have no information on where more than £100m of £500m in lifeline grants to charities, voluntary groups and social enterprises is actually being used.

The report warned of a “notable opaqueness over some aspects” of decision-making by the Department for Digital, Culture, Media and Sport (DCMS).

The PAC questioned why consultants were used to assess funding bids “when established processes were already in place to do this”.

The report found that it was “unclear” what influence special advisers had over some grants. Some charities were given government funding despite civil servants initially scoring their bids in the lowest possible category.

In three instances, charitable organisations were given money despite officials questioning whether the bodies were even “eligible for government funding in the first place”.

The department also failed to provide MPs with a “clear rationale” for spending up to £2m of taxpayers’ money on consultants.

And, because of the speed with which the money was allocated, the department has no way to measure its impact across the country or on the sector.

Meg Hillier, the chair 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 spokesperson for the DCMS spokesperson said: “The PAC has rightly recognised that the government acted quickly in distributing unprecedented amounts of vital funding to charities in desperate need at the height of the pandemic.

“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.”