PPE providers have expressed outrage after it emerged that ministers established a fast-track VIP lane to purchase billions of pounds of protective equipment from little-known companies with links to the Tories.
With ministers already under fire for fostering a ‘chumocracy’ at the heart of government, the National Audit Office (NAO) found that suppliers with links to Tory politicians were ten times more likely to be awarded contracts than those who applied to the Department of Health and Social Care.
The NAO said the government’s procurement efforts during the coronavirus crisis “diminished public transparency”, and accused officials of failing to meet “standards that the public sector will always need to apply if it is to maintain public trust”.
‘It looks manipulated’
By the end of July, more than 8,600 contracts worth close to £18 billion had been awarded – and £10.49 billion of those were awarded directly to the supplier without any competition or tendering process. In some instances, due diligence was not carried out until weeks after contracts were awarded.
The “high-priority lane” was open for companies referred by government officials, ministers, MPs and peers – sources “considered to be more credible”, the report said.
Roughly one-in-ten suppliers processed through the VIP channel – 47 out of 493 – obtained lucrative PPE contracts, compared to less than one-in-a-hundred suppliers that came through the ordinary lane.
In one particularly revealing case, PestFix – a pest control firm from Littlehampton in Sussex – was “added to the high-priority lane in error without a referral”, the NAO said. The company, which has net assets of just £18,000, was awarded a £350 million contract to supply PPE to the NHS.
Speaking on Twitter, Yorkshire Post editor James Mitchinson revealed that he had been contacted by a woman who had been trying to sell PPE on eBay and Amazon, but was unable to do so.
“We are not allowed to set up any new PPE supply,” the message said. “Even though all the stock has the correct certification. It looks manipulated to me now.”
Others pointed to a story from spring, in which a Country Durham firm with the means to make 150,000 visors a day for the NHS was turned down by the government.
Mark Jessup, managing director of Surgical Dynamics, told the Chronicle at the time: “The most disappointing thing with this has been accessing the NHS directly.
“Their whole procurement process has been in complete chaos. The government set up a central response team and we made an offer.
“But we were rejected because basically they did not think we were a big enough company.”
Now it has emerged that companies with links to politicians – no matter how small or inexperienced – were given preferential treatment.
One fast-tracked company, Ayanda Capital, received a £253 million that was brokered by a businessman who was appointed as an adviser to the Board of Trade by Liz Truss, the trade secretary. Again, ministers ordered 50 million FFP2 masks that were ultimately unusable – because they had the wrong kind of ear loops.
Meg Hillier, chairwoman of the public accounts committee, said the government’s procurement efforts had “ridden roughshod over the taxpayer and ripped up too many of the rules that guard against cronyism.”
“It’s bad enough that it set up a ‘high-priority lane’ to fast-track companies with the right connections,” she said. “But the failure to track how half the companies had ended up on it made it impossible to ensure proper safeguards were in place.”