Key facts
- Over £28 billion in UK government aid and Covid relief funds were misdirected between 2015 and 2021.
- Funds reportedly went to terrorists, including Islamic State fighters, and criminal gangs.
- Grants were awarded to companies linked to the Russian state and investment flowed into firms tied to the Chinese military.
- The findings of an internal review were reportedly kept secret due to potential political fallout.
- A separate parliamentary report identified £10.9 billion lost to fraud and error during the Covid response.
A leaked Cabinet Office dossier has revealed that over £28 billion of UK government aid and Covid relief funds were misdirected to terrorists, criminals, and hostile states between 2015 and 2021. The report, unearthed by The Telegraph, found that funds were sent to Islamic State fighters in Syria, grants were awarded to companies linked to the Russian state, and investment flowed into research benefiting firms tied to the Chinese military. Counter-terrorism funding was also reportedly handed to extremists espousing anti-Western ideology, while criminal gangs, including human traffickers, fraudulently claimed housing and disability benefits.
The internal review's findings are believed to be so damaging that officials chose not to disclose the document, fearing the political fallout. The dossier was commissioned in 2023 following fraud identified in the government’s pandemic spending. A separate parliamentary report in December found that taxpayers had already lost £10.9 billion to fraud and error during the Covid response alone.
The reported misspending occurred under the previous Conservative government. A Cabinet Office spokesperson told the newspaper that the current Labour government has saved over £7.5 billion in taxpayer money in the past year through "aggressive fraud prevention and recovery," citing better data and more expert investigators. The total cost of Covid spending has been estimated by the government at £385 billion, with the aid budget around £15.2 billion in 2019. Sir Keir Starmer’s government has also opted to slash international aid spending to ramp up defence spending.