UK whistleblowing reform: key takeaways on proposed whistleblowing incentivisation

On 12 October 2026, the UK Government published a consultation on the operation of the whistleblowing framework in the Employment Rights Act 1996 (ERA 1996) and options for reform. It also seeks views on the design of a proposed Serious Fraud Office (SFO) scheme to provide financial rewards to individuals who report economic crime, and on associated criminal offences (the Consultation). The Consultation closes on 8 January 2027. 

In this article, we consider the backdrop to the Government's proposal for a SFO whistleblowing incentivisation scheme, consider the key aspects of the proposal and questions that the Consultation does not address. 

Background to the Consultation

The debate around incentivising whistleblowing in the UK is not new; until February 2024, however, when Nick Ephgrave QPM, the former Director of the SFO, in his maiden speech ¹ at the Royal United Services Institute (RUSI), announced his support for paying whistleblowers, it had not progressed beyond debate. 

Ephgrave’s advocacy for incentivising whistleblowers came at a low-point for the SFO – in the preceding years, a number of its cases under prior leadership had unravelled due to disclosure issues, it was embroiled in litigation with a corporate suspect, corporate self-reports were on a downward trend and its relevance appeared to be in question. Furthermore, it was concerned that it was losing valuable information to the US authorities who were able to pay whistleblowers for information in certain circumstances. 

Research backed up Ephgrave's enthusiasm for incentivising whistleblowers: on 10 December 2024, RUSI published a research paper ², entitled 'The Role of Financial Rewards for Whistleblowers in the Fight Against Economic Crime' that found financially rewarding whistleblowers could, with appropriate safeguards, increase the effectiveness of economic crime investigations, and advocated for a consultation process to gather the views of relevant stakeholders on the design of a whistleblowing incentivisation programme in the UK. 

In 2025, the Government announced HMRC's "Strengthened Reward Scheme" modelled on the long-running US Internal Revenue Service programme (albeit with material differences) offering whistleblowers (discretionary) rewards of up to 30% of tax collected where the information leads to the collection of at least £1.5 million in tax.

And so, when Jonathan Fisher KC was commissioned to conduct an Independent Review into disclosure and fraud offences in the digital age, the SFO contributed to the inclusion of whistleblower reform in his terms of reference and worked with the review team for over a year to present its case for change. ³

The SFO's Annual Report on Whistleblowing Disclosures for 2025-26 revealed that during the period from 1 April 2025 to 31 March 2026 the SFO Intelligence Division managed 335 whistleblowing disclosures that qualified for inclusion in the report and took action in 333 of those, which means, in this context: "carrying out an initial assessment; referring for further investigation by a more appropriate organisation; or further investigation by the SFO." ⁴

That number, 335, is almost exactly double the number of whistleblower disclosures made in the same period for 2024-25, ⁵ which raises the question as to whether whistleblower financial incentives are needed at all or whether paying whistleblowers would improve the quality of the reports the SFO receives. To determine that question, more information is required as to the quality of the whistle blows the SFO receives already and the use to which they are put.

In Part 2 of his Report, published in July 2026, whilst noting that there was no "silver bullet", Fisher KC recommended making legislative provision for the SFO to financially reward whistleblowers, preceded by a consultation to inform the design of such a scheme. 

Graham McNulty, the current Interim Director of the SFO, has taken up the mantle of his predecessor on this subject, suggesting that such an incentivisation scheme could "slash the volume of material we need to review" and avoid "contested trials" ⁶. This claim must be set against the fact that the number of whistleblower disclosures has doubled in the last year, without financial incentives, and against the fact that, at present, the proposals only relate to information leading to corporate outcomes, of which there have been very few in recent years, and which in any event, very rarely result in contested trials. It seems as likely that this proposal is about encouraging self-reports as it is about reducing contested trials. The SFO has been very clear about wanting more self-reports ⁷ in which context it has sought to emphasise that it "is a more active enforcer than ever before", that "[n]ot self-reporting is a gamble and the odds are getting worse" and that, as part of the weighing up exercise that corporates will go through, should be the intelligence the SFO has access to, including whistleblowers as "another vital source of information." ⁸

Key proposals for a whistleblowing incentivisation scheme 

The Consultation proposes to introduce an incentivisation scheme that would reward people who provide information to the SFO about economic crime, where that information leads to a corporate conviction or alternative enforcement action.

The Consultation addresses four key areas regarding the potential design of the scheme and asks questions in relation to each:

1. Structure and funding. To qualify for a reward, a whistleblower must provide information that is significant and original, and must lead to a successful enforcement outcome against the company. Rewards would be funded from a proportion of the financial penalty or fine paid by the relevant company, and would therefore only be paid once a case is concluded with no outstanding right to appeal (see questions 31-35).
2. Eligibility for rewards. Eligibility for the scheme would not be linked to the requirements for whistleblowing disclosures under the Employment Rights Act 1996. Instead, separate criteria will be established, which may include (among others) whether the individual had a legal duty to report the information or was culpable in the offending their disclosure relates to (see questions 36-37).
3. Size of rewards. A specified percentage range would be set to determine the exact reward based on the value of the financial penalty or fine imposed on the company. Relevant factors to determine the percentage range may include (among others) the value of the information to the case, the whistleblower’s level of cooperation, and how promptly the information was reported (see questions 38-41). Question 40 asks whether there should be set factors which are considered in determining the size of a reward. One example of a possible factor which is given is "whether the information led to any further criminal prosecutions"; another "the degree to which the information was reliable and complete".
4. Supplementary offences. The Consultation seeks views on whether new criminal offences should be introduced for individuals who knowingly make false reports under the new scheme and for individuals who harass or intimidate whistleblowers who report information to the SFO (to protect whistleblowers who cannot avail themselves of the protections and remedies in the ERA 1996) (see questions 42-43).

Questions remain

The aim underlying the Consultation is to improve efficiency of economic crime detection and investigation in the UK. That is a laudable and uncontroversial aim. However, before taking the significant step of financially incentivising whistleblowing to achieve that aim, it would be instructive to consider what led to a surge in whistleblower reports this year, what has happened with those reports and the degree to which financial incentives may be necessary at all. Furthermore, rectifying the SFO's known challenges with disclosure will remain central to achieving successful prosecutions. Any incentivisation scheme must ensure that a defendant's right to a fair trial is never compromised, which would require that information obtained through the scheme is properly vetted and comprehensive disclosure made to the defence of the offer, prospect, or fact, of a financial reward. 

The Consultation asks if one factor in determining the size of a reward should be whether the information led to any further criminal prosecutions. It is unclear whether this is intended to cover situations where information from whistleblowers is used for individual prosecutions, following enforcement action against a corporate entity. In this context, whilst introducing a new criminal offence for individuals who provide false information may provide a safeguard, it is plainly insufficient to ensure the reliability of evidence such that a defendant's right to a fair trial is protected. 

A further factor posited concerning the size of any reward is the degree to which the information was reliable and complete. How that question is to be determined is not considered in the Consultation (merely whether that should be a factor in determining the size of the reward) and yet, it is arguably the most crucial question of all. The just operation of the scheme requires that information provided, in exchange for a financial reward, is subject to scrutiny, robust testing and challenge, for which full disclosure is key. 

The requirement to properly vet information from a whistleblower has been under the spotlight recently following the US Department of Justice's proposals for a new incentivisation scheme for fraud offences. Unlike several existing incentivisation programmes in the US, the new scheme would enable whistleblowers to receive financial rewards where their tips lead to criminal charges, rather than requiring corporate enforcement outcomes. This proposal has been criticised in the US for increasing the risk of unreliable reports. More fundamentally, it recognises that information from a whistleblower may not be reliable and must therefore be verified before it is relied on by law enforcement or a prosecuting authority. This applies regardless of the stage at which a financial reward is made.

Outstanding questions to consider 

Therefore, although the Consultation is in its early stages, there are several key questions set out above, that need to be considered. Other questions that the Consultation does not address include:

1. Should the SFO be responsible for determining both eligibility for rewards and the amount awarded, and how should appeals in relation to the scheme be determined?
2. How will the SFO balance its consideration of, and weight given to, corporate self-reports in cases where it also receives information from a whistleblower?
3. Will the cost of the administering this scheme, together with the rewards themselves, be sufficiently balanced by the value and volume of information received?
4. What steps will the SFO take to verify information provided by a whistleblower?
5. How would a reward regime sit alongside the assisting offender regime, whereby an offender receives a discount to their sentence rather than a financial incentive (especially if complicit insiders are eligible for financial rewards)?

The Consultation is a beginning but it would behove the Government to consider providing supplementary information as to current status of whistleblower reports and a supplementary consultation, if necessary, to deal with important questions which remain unaddressed. 

Authors: Judith Seddon, Partner; Anthony Asindi, Senior Associate; Sara Al Soodi, Trainee Solicitor.