Millions of pounds of taxpayer money squandered on ‘zombie businesses’
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Hundreds of millions of pounds of taxpayer money squandered on ‘zombie businesses’ during pandemic, it has been revealed
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Hundreds of millions of pounds of taxpayer money was squandered on ‘zombie businesses’ during the pandemic, it has been revealed.
The Future Fund, a £1.1billion portfolio set up by then-chancellor Rishi Sunak and managed by the state-owned British Business Bank, invested in 1,190 mainly early-stage companies during the pandemic.
But most are doomed to fail and will wind up as ‘zombie businesses’, minutes of the bank’s audit meeting in June showed.
Doomed to fail: The Future Fund invested in 1,190 mainly early-stage companies during the pandemic
The Government did no independent due diligence on any of the businesses.
John O’Connell of the TaxPayers’ Alliance said: ‘These reports suggest taxpayers’ cash could have been lumped onto lost causes.’
The Future Fund scheme matched pound-for-pound funds raised from outside investors, up to £5m.
A spokesman for the bank said that write-offs with this kind of investment are relatively high but that financial returns are buoyed by a handful of ‘high performing outlier companies.’ She said it was too early to gauge the overall performance of the Future Fund.