THE UK Government awarded personal protective equipment (PPE) contracts at inflated prices to firms with links to Cabinet Office contacts and selected “VIPs”, a new bombshell report reveals.
The Good Law Project has revealed that special procurement channels were set up for favoured firms applying for NHS deals, despite ministers insisting that “suppliers will be evaluated by departmental officials on their financial standing”.
Leaked documents show the Cabinet Office was directly feeding its contacts into the procurement process, outside the normal public channel.
The papers also detail astonishing opportunities for selected companies to earn contracts at exorbitant rates. “It is only if prices were more than 25% above the average paid to other suppliers that questions were to be asked about value for money,” the Good Law Project report reveals.
The organisation’s director, Jolyon Maugham QC, writes: “The leaked documents reveal that Cabinet Office contacts and others were helping ‘VIPs’ sell PPE to Government outside normal procurement channels.
“The information that Government would buy at 25% above the price paid to ‘regular’ suppliers was a licence to make enormous margins – 35 to 45% – on contracts sometimes worth hundreds of millions of pounds.”
The Good Law Project has initiated several judicial review cases against the Department for Health and Social Care over PPE deals handed to companies including a pest control firm, a confectionery wholesaler and an “opaque family fund”.
Among the companies is PPE Medpro, set up by the former business associate of Conservative peer Baroness Mone just seven weeks before it was awarded a £200m contract.
Another of the firms under scrutiny is Ayanda Capital, which received a £252m contract for supplying face masks, the majority of which were deemed unusable by the NHS.
Maugham adds: “Although Government has tried to cover up the per unit prices it paid to connected suppliers, we know that Ayanda enjoyed staggering margins above the prices paid to others.
“So there are certainly questions to be asked about whether other politically connected ‘VIPs’ benefitted from lucrative inside information about pricing.”
A UK Government spokesperson commented: “We have been working tirelessly to deliver PPE to protect our health and social care staff throughout the pandemic, with more than 4.4 billion items delivered so far and 32bn items ordered to provide a continuous supply to the frontline over the coming months.
“Proper due diligence is carried out for all government contracts and we take these checks extremely seriously.”