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Architects warned over misuse of Covid-19 furlough and income support schemes

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Architects have been warned they could face action if found to have abused government grant schemes during the coronavirus crisis

The HMRC recently set out draft legislation to give it powers to claim back money incorrectly claimed or spent under the furlough or self-employment support schemes announced by the chancellor in late March.

The legislation, to become part of the Finance Bill, will also allow the taxman to charge a penalty where a person deliberately makes an incorrect claim through the schemes.

Both the ARB and the RIBA have now said they would consider taking their own measures if self-employed individuals or companies in the sector fell foul of new laws on Covid-19 support payments.

An ARB spokeswoman told the AJ this week: ‘The facts of any case require individual investigation, but it would be fair to say that any architect found to have been inappropriately profiting from the health-crisis is likely to be disciplined.

‘We frequently engage with other regulatory bodies, including HMRC, as appropriate when conducting our investigations.’

RIBA executive director for professional services Adrian Dobson added: ‘RIBA members and chartered practices are expected to abide by applicable laws and regulations at all times. The RIBA will consider any allegations of misconduct against members on a case-by-case basis.’

Research published earlier this month by the RIBA found that 38 per cent of construction projects had been placed on hold since 1 March as clients reacted to the social distancing measures enforced by the government and the huge knock to the broader economy. About 1 per cent of architectural staff had been laid off across the sector.

More than one in four respondents to a poll taken in May said they expected the permanent headcount at their practice to decrease by August.

The Coronavirus Job Retention Scheme allows employers to claim a government grant to pay a proportion of furloughed workers’ wages, while the Self Employed Income Support Scheme entitles people working for themselves to taxable handouts during the crisis.

Fledgling trade union United Voices of the World – Section of Architectural Workers (UVW-SAW), last month said some furloughed employees had been asked to continue doing fee-paying work, which is against the rules of the Coronavirus Job Retention Scheme.

A spokesman for UVW-SAW told the AJ this week that a ‘small but worrying number’ of workers had been asked to work while furloughed.

‘In most cases, raising a collective grievance, calling a staff meeting or signing an open letter has remedied the issue,’ he said. ‘However, some members have been dismissed for such behaviour, and we are supporting them in taking legal action.

‘With consideration and the consent of their former colleagues, these members may at some point choose to raise these fraudulent activities with HMRC.’

An HMRC spokesperson said the furlough scheme was part of a collective national effort to protect jobs.

’This is taxpayers’ money and fraudulent claims limit our ability to support people and deprive public services of essential funding,’ he added.

‘We are prioritising work to support our customers, while tackling serious fraud and criminal attacks, and will not seek out cases of innocent error or small mistakes for compliance action. A penalty would only apply in cases of deliberate non-compliance.’

HMRC has asked anyone concerned their employer might be abusing the scheme to get in touch.

  • 2 Comments

Readers' comments (2)

  • Industry Professional

    HMRC should insist that any worker who has been furloughed be employed for at least 6 months (maybe 12) after the end of the furlough provision.
    Otherwise the government have simply been ripped off by the employers obtaining money ostensibly to protect jobs only to make those same people redundant at the end of the furlough arrangements.

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  • I agree with Industry Professional's comment.
    Furthermore some Employers are using the Furloughing scheme to make reduncies at no cost to themselves what so ever. Some Practices gave notice to Employees in early June so that the month notice was fully paid from public funds, before the employer had to start making a contribution in August. The scheme was established as job protection, not as a means of prematurity facilitating redundancy. The industry and society would be better off without the existence of such rogue practices. HMRC needs to pursue feral Practices for fraud, and the ARB & RIBA pursue those responsible for breaching Codes Conduct and abusing Chartered Practice status. Our Students & Architects deserve better.

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