UK taxpayers will be footing the bill for mistakes the Tory government made during the pandemic “for years to come”, the chair of a key Westminster committee has said.
The comments came as the Public Accounts Committee published a report into the billions of pounds wasted by Conservative “mismanagement” of PPE contracts.
The often damning report focused on PPE procurement by the Department of Health and Social Care (DHSC) – which was run by Matt Hancock until June 2021, then Sajid Javid until July 2022, and is now led by Steve Barclay.
The SNP said the conclusions showed the "stark contrast" with the procurement of cheaper and more locally produced PPE in Scotland.
The report found the UK Government was spending around £7 million every month to store the 3.9 billion unneeded items which it bought during the Covid pandemic. Some of these may have to be incinerated if no other use can be found for them.
A number of the billions of items are still in China, while others are scattered across more than 70 storage locations in the UK or being held by suppliers.
These 3.9bn items are on top of the 3.6bn PPE items which were not deemed up to standard for use in front-line services. The report found there are a further 1.39 billion PPE items which still have not been quality assured.
The committee’s report also said there was “up to £2.7bn of taxpayers’ money at risk” as a total of 176 contracts are currently in dispute, mainly over issues of quality.
What’s more, the report said the UK Government is not able to “fully understand what PPE it has and where it is” because it does not have the right systems in place.
In total, the DHSC awarded around 10,000 contracts, worth £13.1 billion, which were expected to deliver 37.9bn items of PPE.
Damning conclusions on the awarding of these contracts also estimate that as much as £400m in taxpayer cash could have been lost to fraud.
The committee said that the DHSC had accepted that as much as 5% of PPE expenditure could have involved fraud. However, the government department was “unable to give [MPs] any details on how it is progressing any fraud inquiries”.
The UK Government reportedly argued that fraud in such contracts is “a fact of life”.
The report also noted the unlawful “VIP lane” which Boris Johnson’s government set up early in the pandemic for PPE contract bids from firms recommended by Tory ministers. The MPs said this unlawful channel “resulted in 115 contracts worth £3.8bn being awarded to 51 suppliers”.
The committee’s report twice raises the issue of PPE Medpro, a firm at the centre of a fraud probe by the National Crime Agency.
PPE Medpro – which is at the centre of a House of Lords probe amid claims that Tory peer Michelle Mone and her husband are linked to it, which they have denied – was paid £122m for unusable gowns which were bought from the Chinese manufacturer for just £46m.
The committee asked how the firm had been “able to secure a £76 million profit”, saying the DHCS had been “reluctant” to give any details. MPs said they were told all of the PPE contracts signed “went through exactly the same due diligence process”.
This is directly contradicted elsewhere in the report. The committee found that 46 of the 115 VIP lane contracts had been awarded before a “formalised eight-stage due diligence process” had been established. As such, it says “not all due diligence checks on areas such as financial, commercial and legal issues were completed before awarding contracts”.
Meg Hillier (above), an MP and chair of the Public Accounts Committee, said: “The departure from normal approaches to due diligence, record keeping, decision making and accountability in relation to PPE contracts puts a stain on the UK’s response to the pandemic.
“Even if you accept that some proper procedure will have to slip in times of crisis, the complete collapse of some of the most well-established civil service practices beggars belief. The taxpayer will be paying for these decisions for years to come.”
The SNP’s Cabinet Office spokesperson, Brendan O’Hara, said that people struggling with cost of living would be “expected to foot the multi-billion pound bill for the Westminster government’s incompetence”.
He went on: “The Tory government owes the public an apology.
“As a result of Tory ministers’ mismanagement of Covid contracts, we now have a stockpile of almost four billion items that are unusable and set to be incinerated. That is a kick in the teeth to all who are working to tackle climate change.
“In stark contrast, the Scottish Government retains powerful safeguards on the use of public money in healthcare through strong procurement rules. In Scotland, 88% of PPE is produced locally and overall costs of pandemic procurement were a third less than the UK.”
A spokesperson from the DHSC insisted that it takes fraud “extremely seriously” and said it was exploring “every available option – including working with law enforcement partners – to bring those who commit fraud to account and seek to recover losses”.
They went on: “Our priority throughout the pandemic has been saving lives. Despite massive inflation in prices and unprecedented global demand, we delivered over 21.4 billion items of PPE to frontline staff to keep them safe, with only 3% of the PPE we procured unusable in any context.
“It is simply wrong to suggest that the department does not know how much PPE it has, or where it is located. We have a comprehensive data system in place to allow us to oversee the storage network and dispose of any excess stock.”
