- Rishi Sunak, then Chancellor, was seen as a move to boost hospitality venues
- This was revealed by a senior Treasury official in the Covid-19 investigation
- The Prime Minister then unveiled the Eat Out to Help Out scheme
Rishi Sunak considered sending every adult in the UK a prepaid debit card to help boost the economy during the pandemic, a Treasury insider has claimed.
The then-Chancellor allegedly floated the idea as part of efforts to stimulate the beleaguered hospitality industry, which was hit hard when venues such as pubs and restaurants were ordered to close as Covid cases rose in 2020.
Mr Sunak later unveiled the Eat Out to Help Out programme, where the government subsidized up to £10 per customer for meals on certain days in August that year.
Industry chiefs saw the scheme as a stimulus, but scientists scoffed at it for fear it would lead to higher infection rates.
It has since emerged that Mr Sunak has considered offering other financial incentives to the hospitality sector, including prepaid credit cards.
A witness statement in the Covid-19 inquiry from Dan Yorke-Smith, a senior Treasury official, said the idea was scuppered amid fears thieves could intercept tens of millions of taxpayers’ money.
He said: The first option, which is distributing prepaid debit cards, represents great challenges and risks.
“For example, registering every adult in the UK would have presented very significant challenges in the time available.
“Even if this could be achieved, there would be significant risks associated with distributing tens of millions of cards through the mail as part of a widely promoted and marketed scheme, such as theft, fraud and loss.
This was dangerous [was] Mailing of coupons is also included.
“There was also a need for a large customer support function, which did not exist.”
“The compressed schedule of the scheme has heightened the importance of these challenges.”
Mr Sunak strongly defended the Eat Out To Help Out scheme when he was questioned at the inquiry earlier this month.
He said the scheme was “in no way responsible” for a second wave of Covid, that he “did not believe it posed a risk” and that it was “the right thing to do to protect jobs”.
The Prime Minister insisted his approach was a matter of “social justice” and provided a boost to hard-hit industries.
York Smith’s witness statement, published just this week, shows Sunak also considered extending the scheme in Aberdeen to September, after a local lockdown meant residents were unable to take advantage of most of August.
However, the plan was postponed.
The investigation is taking a break until the new year when it will look at the response to the pandemic in the devolved countries.
The investigation is not expected to conclude public hearings until 2026.