Just two per cent of Covid fraud tip-offs are being investigated, the government has admitted.

Around 98 per cent of claims phoned into the government’s coronavirus fraud hotline are not being actively pursued, ministers have said.

A total of 5124 calls were made to the hotline during its existence – from October 2020 to June 2023 – according to a written answer to a question from Emily Thornberry, Labour’s shadow attorney general.

But just 103 of those – or 1 in 50 – were undergoing investigation, with just 20 being looked at by the National Investigation Service (NATIS), as of October 2023.

While the Insolvency Service were looking into a further 83 reports, as of March 2023, cabinet office minister Alex Burghart confirmed in response to her written question.

All calls to the hotline, which was run jointly with charity Crimestoppers, were forwarded to the relevant departments and the decision to investigate is up to them, he added.

Labour highlighted research by the House of Commons library which they say found the estimated total of Covid-related fraud amounted to £7.2bn of public money.

It comes after former counter fraud minister Lord Agnew resigned his job in January 2022 in protest at the government writing off losses.

He claimed the Treasury under Rishi Sunak appeared “to have no knowledge of, or little interest in, the consequences of fraud to our economy or society”.

Sunak was also warned in 2020 by Keith Morgan, British Business Bank CEO, who told him the scheme was “vulnerable to abuse by individuals and by participants in organised crime”.

Darren Jones, shadow chief secretary to the Treasury, said: “Billions of pounds of taxpayers’ money was lost to fraud and corruption during the pandemic on Rishi Sunak’s watch. And yet, the Conservatives are turning a blind eye and letting those responsible off the hook.”

Commenting after shadow chancellor Rachel Reeves vowed to crack down on Covid fraud at Labour’s conference, Jones added: “Labour understands the value of taxpayers’ money.

“That is why we will appoint a Covid Corruption Commissioner with the powers to get that money back and put it back where it is needed in our schools, hospitals and police.”

Burghart added that hotline information also helped ministers “better understand the threat across government and informed the wider intelligence picture” and “contributed to media campaigns providing guidance in relation to Covid Pass fraud, vaccine fraud and phishing”.

A government spokesperson said: “We are overhauling the way we tackle public sector fraud to ensure we prevent more fraud and chase down public money stolen from taxpayers. Since 2021, we have invested more than £900 million in taking action on fraud, and have established the Public Sector Fraud Authority to bolster fraud defences across departments.

“In the last two years, the government has recovered and prevented more than £3.1bn of fraud losses, including within Covid-19 schemes, but we know there is more we can do.

“That is why we are expanding the Government’s Counter Fraud Profession, developing new technologies and boosting skills and training to further protect the public purse.”