It’s not working out: MPs call for rethink of fraud squad’s blockbuster funding
Funding for the fraud squad needs to be overhauled, as the agency now leans too heavily on financing intended solely for its mega cases, MPs have argued today.
Stephen Timms, the Labour MP who brought this morning's Westminster Hall debate on the funding of the Serious Fraud Office (SFO), remarked the agency had recently shifted "away from core funding and towards blockbuster funding".
The SFO, which was established in 1988, is funded through a mixture of core funding, which covers its regular expenses, and blockbuster funding, which is allocated on a case-by-case basis to cover its biggest investigations and requires sign-off from the Treasury.
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However, Timms argued the over-reliance on blockbuster funding, which has been used in investigations such as Libor, had lead to a short-term approach by the agency, including ditching skilled and knowledgeable temporary staff once the case they were working on had finished.
The Labour MP also slammed the system for lacking transparency, as it was unclear on what basis the government chose to extend funding.
"The sight of the SFO repeatedly having to go, cap in hand, to the Treasury for supplemental income also opens the government to allegations that it has the ability of closing down what might be politically sensitive inquiries…I'm not suggesting for a moment that the government is behaving improperly. However it must see there is that inherent conflict of interest," added Conservative MP Mark Field.
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However, solicitor general Robert Buckland argued, while blockbuster funding may not be perfect, "when it comes to the need to be flexible and to recognising the ever-changing demands on the SFO, I'm afraid a degree of inelegance is a price worth paying".
"There are a number of reasons why the current blockbuster funding approach is not working efficiently," explained Jonathan Pickworth, partner at White & Case. "The SFO performs an essential job in investigating and prosecuting cases of serious and complex fraud in the public interest. But for the agency to maintain this crucial role it needs to be objective in its decision making without government interference."
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Ross Dixon, partner at Hickman & Rose, added: "The move to drip-feed funding means that the SFO will remain chronically underfunded. If the government were serious about cracking down on corporate fraud it would provide the SFO with adequate funding to build its capacity as an expert investigator."
An SFO spokesperson said: "The blockbuster funding approach allows us to do [large and expensive] cases while avoiding the maintenance of very high permanent staffing levels, which we may not always need."