A Tory party grandee and former Goldman Sachs executive who led the government’s procurement of protective equipment handed millions of pounds in contracts to companies in which he has financial interests.
Lord Paul Deighton was at the helm of the UK’s much-criticised effort to supply PPE – and oversaw the creation of the controversial ‘VIP lane’, which allowed ministers to purchase billions of pounds of PPE from little-known companies with political contacts in the Conservative party.
The “high-priority lane” was open for companies referred by government officials, ministers, MPs and peers – sources “considered to be more credible”, a National Audit Office report said last month.
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.
Part of that contract was a deal to buy 25 million FFP2 face masks. After 600,000 of the masks were delivered, it emerged that they were “not in line with the government’s published PPE specifications” – and were therefore unusable. PestFix “is continuing to work” with the Department of Health, the report revealed.
Another 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.
According to a New York Times investigation, Lord Deighton “remains involved in business and has financial or personal connections to at least seven companies that were awarded lucrative government contracts”, totalling around £220 million.
Although he declared his interests in a public House of Lords register, Lord Deighton’s involvement in high-level meetings and strategy discussions raises questions over a conflict of interest.
Two contracts linked to the Tory peer, the NYT revealed, were related to PPE. One – for close to £60 million – was awarded to Honeywell Safety Products – a subsidiary of Honeywell International, a company he holds shares in.
He is also a shareholder in AstraZeneca, the pharmaceutical company that is in the late stages of developing a vaccine with Oxford University – and was also awarded £150 million for testing services.
‘Fast and loose with public money’
Lord Deighton also holds shares in consulting firm Accenture, which was handed more than £4 million to help develop England’s flailing contact tracing app – while UBS, another company he has a stake in, won more than £560,000.
Another contract worth close to £300,000 was awarded to consulting firm Chanzo, to help set up a PPE procurement system. They also provided Lord Deighton with a chief of stuff.
The firm’s founder is a long-term business associate of the Tory grandee – and worked with him on the 2012 Olympic committee. Jean Tomlin, the NYT reported, is also a director at a corporate intelligence firm chaired by Lord Deighton.
Lady Alison Deighton, his wife, is also a former director of NM Rothschild – which won a lucrative consulting contract – while another consulting contract was awarded to an investment bank advised by one of Lord Deighton’s colleagues on the Olympic committee.
Labour’s Meg Hillier, chair of the Public Accounts Committee, told the paper: “The government had license to act fast because it was a pandemic, but we didn’t give them permission to act fast and loose with public money.
“We’re talking billions of pounds, and it’s quite right that we ask questions about how that money was spent.”