Ministers doled out billions in Covid-19 contracts without proper records or transparency
Contracts were handed to a firm with links to Dominic Cummings and Michael Gove (Image: NEIL HALL/EPA-EFE/REX/Shutterstock)
Get our daily coronavirus email newsletter with all the news you need to know direct to your inbox
Sign upWhen you subscribe we will use the information you provide to send you these newsletters. Sometimes they’ll include recommendations for other related newsletters or services we offer. OurPrivacy Noticeexplains more about how we use your data, and your rights. You can unsubscribe at any time.Thank you for subscribingWe have more newslettersShow meSee ourprivacy noticeInvalid Email
Ministers doled out billions of pounds worth of contracts in the fight against coronavirus without keeping proper records in a regime blasted for lacking transparency, a watchdog said today.
Government procurement has come under the microscope after ministries awarded deals to Tory cronies and friends of Dominic Cummings in the rapid battle to curb the spread of Covid-19.
According to a National Audit Office report published today, by July 31m more than 8,600 contracts, worth £18billion, related to government's response to the pandemic had been awarded.
Individual contracts ranged in value from less than £100 to £410million.
Among them, as the Mirror revealed earlier this year, was £550,000 was handed to Public First, a firm owned by allies of Michael Gove and Dominic Cummings.
Another bungled deal saw a family-owned pest control and public health supplies firm awarded a PPE contract worth millions after being ‘fast-tracked’ through the procurement process by mistake.
And a data firm previously used by Vote Leave was handed three contracts worth a total of £3 million with no documentation on conflicts of interest. It was later revealed that a Tory minister owned £90,000 of shares in the firm.
(Image: Getty Images)
Fury over £1billion coronavirus deals as Tories hand out huge contracts to pals
Some 90% of the contracts by value – worth £16.2 billion – were awarded by the Department of Health and Social Care and its national bodies.
In comparison, in 2019-20 DHSC awarded 174 contracts worth £1.1billion, less than 7% of what it and its national bodies awarded between January and July 2020 in response to the pandemic.
Personal protective equipment accounted for 80% of the number of contracts awarded and 68% of the total value of contracts awarded – worth £12.3 billion.
PPE needed to be procured quickly during the first few months of the pandemic, when global demand far exceeded supply.
But, the NAO said, “a clear trail of documents to support key procurement decisions was sometimes missing”.
And a source familiar with the Cabinet Office’s procurement process described it as “chaotic.”
The source told the Mirror that for the Cabinet Office, the report was “not a particularly laudatory document.”
Rachel Reeves, Labour ’s Shadow Cabinet Office Minister said: “This report confirms that this Tory government’s approach to procurement has fallen far short of what this country deserves. Lessons must be learned.
“The National Audit Office has shown how, at best, this incompetent government can’t even get basic paperwork right.
“At worst, that the government may be deliberately attempting to cover their tracks, avoid scrutiny or withhold information from the public while wasting taxpayer money.”
The Cabinet Office's procurement process was branded "chaotic"
(Image: NurPhoto/PA Images)
Michael Gove's department alone spent £50m on consultants and marketing during Covid-19 crisis
Audit office chief Gareth Davies said: "At the start of the COVID-19 pandemic in the UK, government had to procure large volumes of goods and services quickly whilst managing the increased risks this might entail.
“While we recognise that these were exceptional circumstances, it remains essential that decisions are properly documented and made transparent if government is to maintain public trust that taxpayers' money is being spent appropriately and fairly.
“The evidence set out in our report shows that these standards of transparency and documentation were not consistently met in the first phase of the pandemic."
Cabinet Office Minister, Julia Lopez, said: “We have been dealing with an unprecedented global pandemic that has posed the biggest challenge to the UK in a generation.
“As this report rightly recognises, we needed to procure contracts with extreme urgency to secure the vital supplies required to protect frontline NHS workers and the public and we make no apology for that.
“We have robust processes in place for spending public money to ensure we get critical equipment to where it needs to go as quickly as possible, whilst also ensuring value for money for the taxpayer.
"It is important to maintain the public's confidence in how we manage their money, and we welcome the NAO's scrutiny of our processes and recommendations on how they can be improved"
It came amid questions by shadow health minister Dr Rosena Allin-Khan over a company not mentioned in the report, called Medpro Limited. She said that the company was "given Government contracts worth over £190 million" yet had "no previous experience" of producing PPE.
Dr Allin-Khan added: "Reports have suggested that this company has substantial links to Conservative Party donors. So can the Secretary of State or the minister categorically assure the country that no Conservative Party donors are profiteering from the pandemic?"
Tory Health Minister Jo Churchill replied: "Our plan on PPE has to be to stabilise the system and build resilience – this was outlined in the PPE strategy published on 28 September."
And Chancellor Rishi Sunak has refused to say whether he'll profit from a rise in the share price of the firm behind a new Covid-19 vaccine.
(Image: NurPhoto/PA Images)
Ofqual give Dominic Cummings-linked firm £46,000 contract to clean up exams fiasco
Sunak was a founding partner of Theleme Partners, a major investor in Moderna – who declared on Monday had developed a 94.5% effective jab.
The Government is in talks to buy 5 million doses of the vaccine.
But it's not known whether the Chancellor retained any shares in the Theleme fund after leaving in 2013. The fund is registered in the Cayman Islands, which does not make such records public.
Mr Sunak has declared to authorities that he is the beneficiary of a blind trust.
But his office would not disclose whether his investments include a stake in Theleme's fund or Moderna.
A Treasury spokesman said: “The Cabinet Office has set out what are judged to be the relevant interests in the regular list of ministerial interests.”
Public First, a PR firm owned by allies of Dominic Cummings and Michael Gove, was handed half a million for performing focus groups on the Covid crisis.
No10 won’t rule out breaking manifesto promise and slashing help for world's poorest
The report said there was "no documentation on the consideration of conflicts of interest, no recorded process for choosing the supplier, and no specific justification for using the emergency procurement."
And the contract was awarded retrospectively, after work had already begun.
James Frayne, founding partner at Public First, said: “It has suited opponents of this Government to omit this fact but, as the NAO finally makes clear, no great contract was ever agreed in advance with us.
“We agreed a pay-as-you-go deal where we could be terminated at any point if they weren’t happy with our work.
“The reason we worked with Government for so long was because we provided useful insight, particularly amongst the hardest to reach groups.”
The firm was also asked to provide a member of staff to work – Public First partner, Gabriel Milland – to work in Downing Street, which the report states was done with no formal contract in place.
But the NAO said awarding retrospective contracts increased the risk of "underperformance”, though there’s no suggestion of any underperformance in this case.
Other firms contracted retrospectively included Deloitte, handed £3.5 million for “support” in PPE procurement, and Topham Guerin, who ran the Tories digital election campaign in 2019 and were given £1.5m for PR campaign work.
In both cases, the report says paperwork on the process of awarding the contracts was found to be lacking.
A Topham Guerin spokesman said: “Topham Guerin are proud to have worked with both the New Zealand and UK governments to provide creative and digital support for their all-of-government responses to the Covid-19 crisis."
Deloitte declined to comment.
Boris Johnson's 'levelling-up' plan needs a branding like the NHS, says report
PestFix, a family-owned pest control and public health supplies firm, were awarded a contract eventually worth £59m to supply PPE.
The report says government added the firm to the ‘high priority’ queue for suppliers by mistake.
And it says due diligence was not performed on the firm, despite a previous assessment ranking them “amber”.
The 600,000 masks initially supplied by the firm were as agreed with the government – but did not comply with newly updated PPE specifications, so can’t be used for their intended purpose.
A Pestfix spokesman said: “The National Audit Office has correctly found that we delivered the masks in accordance with the contractual specification.
“However, after delivery of a tiny percentage of the masks, the Government changed its requirements such that the masks required head straps rather than ear-loops.
“The Government is currently looking at ways to repurpose the small number of FFP2 masks delivered and, at the Government’s agreement, the remaining 97.6% of the contract value was changed to a different type of mask, providing a value-for-money solution to the taxpayer.”
Faculty, a data firm engaged by the Housing department, the Business department and NHSX for a combined £3 million of work, was previously used by the Vote Leave campaign.
And a Tory minister, Lord Agnew, owned £90,000 worth of shares in the firm at the time the contract was awarded.
But the report found no evidence Lord Agnew had been involved in any of the contracts, and that his stake in the firm was properly declared. Lord Agnew has since placed the shares in a blind trust.