Half of PPE procured by UK using ‘VIP’ companies has not been used

More than half the £1.7bn paid by the government to politically connected “VIP” companies to supply PPE in the pandemic was spent on equipment that has not been used, according to new figures.

David Conn www.theguardian.com 

The total value of unused PPE was £2.8bn for 1.9bn items, according to newly released figures from the Department of Health and Social Care (DHSC).

The DHSC did not explain why the PPE was unused but it was not all defective. Last week the department revealed that PPE worth £750m was never deployed because it had passed its safe use-by date. Huge quantities were stockpiled after the government over-ordered in the pandemic.

The proportion of unused PPE is significantly higher for contracts processed through the a so-called VIP lane – 59% of the £1.7bn ordered from them – than for other firms awarded contracts through the standard procurement route. Of the £10.4bn committed to non-VIP companies for PPE, 17% or £1.8bn has not been used.

DHSC released the figures and the names of companies whose PPE has gone unused in response to a freedom of information request pursued by Spotlight on Corruption. In June last year, 1.9bn PPE items were described by a minister as having been put in the “‘do not supply’ [to the NHS] category” but it is possible that some has since been cleared for use.

The department’s list includes 552,100 unused items, costing £8.5m, supplied by Meller Designs. The firm, which was awarded a total of £164m in PPE contracts, was co-owned at the time by David Meller, who has donated nearly £60,000 to the Conservative party since 2009 including £3,250 to support Michael Gove’s party leadership bid in 2016, a campaign on which Meller worked as chair of finance.

In November the DHSC revealed that Gove’s office had referred Meller’s company as a potential PPE supplier, and it was then processed through the VIP “high priority lane” for companies referred by Tory MPs, ministers, peers or health officials. On Friday the company declined to comment.

Another firm on the unused PPE supplier list is PPE Medpro. It was awarded two contracts worth a total £203m after the Tory peer Michelle Mone initially referred the company in May 2020 to her fellow Tory peer Theodore Agnew, then a Cabinet Office minister responsible for procurement.

The DHSC’s newly released list says that 25.5m items ordered from PPE Medpro, worth £124.7m, have not been supplied to the NHS, which appears to include the 25m sterile surgical gowns ordered in June 2020 for £122m. PPE Medpro have insisted that they supplied the gowns to the technical specification required. The DHSC has said it is in dispute with the company that it is seeking to resolve via mediation.

SG Recruitment, referred by the Conservative peer Peter Gummer who is a director of its parent company Sumner Group Holdings, told the Guardian that its PPE, 2.4m items costing £26m, was on the list because it had been awaiting checks but had now been cleared for use in the NHS.

PPE costing £1bn in total stated not to have been passed to the NHS – 476m items such as face masks, gowns and other vital equipment – was supplied by 25 companies whose contracts were processed via the VIP lane, Spotlight on Corruption’s analysis of the DHSC’s list has revealed.

The high priority given to these companies, some newly formed or with no track record in medical products, meant they were given a more attentive personal service at the start of the procurement process, previous reporting has found.

The DHSC publication follows a statement in parliament by the then health minister, James Bethell, in September that as of 10 June last year, “1.9bn items of [PPE] stock were in the ‘do not supply’ category”.

Bethell was replying to a parliamentary question from crossbench peer David Alton, who has pressed in the Lords for details of the waste associated with PPE procurement.

The VIP process was ruled unlawful in the high court last month following a challenge by the Good Law Project; Mrs Justice O’Farrell ruled that the government had failed to give equal treatment to all companies offering to supply PPE.