Controversies regarding COVID-19 contracts in the United Kingdom

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Prime minister Boris Johnson, who was accused by critics of cronyism in the allocation of contracts
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In response to the COVID-19 pandemic in the United Kingdom, the British government decided in March 2020 to rapidly place contracts and recruit a number of individuals; shortages of personal protective equipment were a particular political issue for the second Johnson ministry. This led to a number of contracts being awarded without a competitive tendering process, and friends of political figures and people who had made political donations were fast-tracked into contracts. As such, a number of accusations of cronyism were made against the government.

Shortages of PPE and equipment[]

See also: Shortages related to the COVID-19 pandemic

Simulations of influenza-like pandemics have been conducted by National Health Service (NHS) trusts since the 2007 H5N1 influenza outbreak. Russell King, an NHS resilience manager at the time, said that "the Cabinet Office had identified the availability and distribution of PPE (personal protective equipment) as a pinch point in a pandemic".[1]

Shortages of COVID-related PPE were commonplace worldwide throughout the pandemic

The government was criticised early in the pandemic for the lack of PPE available to NHS workers, and there was pressure to supply PPE quickly to the NHS.[2] The UK did not take part in an 8 April bid for €1.5bn (£1.3bn) worth of PPE by members of the European Union, or any bids under the EU Joint Procurement Agreement (set up in 2014 after the H1N1 influenza pandemic)[3] because "we are no longer members of the EU".[4] The purpose of the agreement was to allow EU countries to purchase as a bloc, securing the best prices and allowing quick procurement at a time of shortages. Under the terms of the Brexit withdrawal agreement, the government had the right to take part until 31 December 2020.[3]

In March 2020, the government called for British industry to manufacture ventilators for the NHS. Dyson and Babcock revealed plans to manufacture 30,000 medical ventilators, a number seen as necessary based on modelling from China. The "ventilator challenge" involved companies such as Airbus, Rolls-Royce and Ford.[5] Company sources later told The Guardian that this was known to be impractical at the time; the ventilators suggested by the government to the companies were crude, and would not have been able to be used in hospitals. None of the companies involved reached the final stages of testing and most were, in hindsight, superfluous.[6]

The Doctors' Association UK alleged on 31 March 2020 that shortages were covered up with intimidating emails, threats of disciplinary action and, in two cases, being sent home from work. Some doctors have been disciplined after managers were annoyed by material they had posted online about the shortages.[7] Speaking to Nafeez Ahmed in April, former World Health Organization employee Anthony Costello said: "We simply don't have enough PPE. Not enough visors, not enough N95 respirators. [The] government is not following WHO guidelines."[8]

On 18 April, Robert Jenrick reported that 400,000 protective gowns and other PPE were on their way to the UK from Turkey.[9] One day later, they were delayed; this led hospital leaders to directly criticise the government for the first time since the pandemic began.[10] The shipment arrived at Istanbul airport en route to the UK two days after ministers said that the PPE would reach the UK.[11] Only 32,000 gowns arrived (less than one-tenth of the order), despite the NHS making a down payment to secure their arrival on 22 April.[12] They ultimately had to be returned to Turkey, since they did not meet NHS standards.[13] In May, it was learned that almost half of England's doctors sourced their own PPE or relied on donations when none was available through normal NHS channels.[13]

Bypassing the open call for bids[]

According to the Byline Times, the UK usually publishes an open call for bids to provide PPE in the Official Journal of the European Union. The newspaper says that, according to EU directives, the government does not have to open up a contract to competition when there is an "extreme urgency" to buy goods or services and can approach companies directly. They further state that during the pandemic, the Department of Health and Social Care (DHSC), local NHS bodies and other government agencies have directly approached firms to provide services, bypassing the EU's tendering process – in some cases, without a "call for competition".[14] They say this was done by invoking emergency procurement procedures – regulation 32(2)(c) of the Public Contract Regulations 2015 – that allowed for the sourcing of goods without a formal tendering process.[15] On 19 February 2021, the High Court of Justice ruled that the government had violated the law by not publishing contract awards within 30 days.[16]

Tendering-process concerns[]

The National Audit Office (NAO) said that £10.5 billion of the overall £18 billion spent on pandemic-related contracts (58 per cent) was awarded directly to suppliers without competitive tender, with PPE accounting for 80 per cent of the contracts.[17] The UK government was competing with governments worldwide and, to satisfy the unprecedented demand for PPE, had awarded contracts hastily and bypassed normal competitive tendering processes to secure supplies.[17] As a result of the NAO report, the Good Law Project advocacy group opened a number of cases against the DHSC. The project questioned the awarding of PPE contracts worth over £250 million to Michael Saiger, who headed an American jewellery company based in Florida and had no experience in supplying PPE;[18] the contracts involved a £21 million payment to intermediary Gabriel González Andersson.[19] The contract was offered without any advertisement or competitive tender process.[18]

Transparency International UK found that one-fifth of the contracts "raised red flags for possible corruption".[20] A fast-track "VIP lane", which awarded funding at a rate 10 times higher than other routes, prioritised Conservative Party donors and others connected with the party.[20][21] According to a leaked document from the Good Law Project on 16 November 2021 (published before its planned official release by the government), 47 companies were referred to this route. Michael Gove referred (which received £164m in PPE contracts)[22] and (which received a $15m contract for PPE) to this route. A spokesperson for Gove denied that the referral was improper. Matt Hancock referred (which received contracts worth £135.4m), (which received a contract worth £80.7m) and (which received a contract worth £28.8m). Lord Feldman referred (which received £79.6m of contracts), , (which received a contract worth £12.8m) and (which received a contract woeth £1.85m). Feldman told The Guardian he had no previous knowledge of the companies or commercial relationship with their owners and that the companies were referred to him by third parties and he had no knowledge they became fast-tracked. Lord Agnew referred (one of the largest recipients of non-open tender pandemic agreements; it received eight contracts worth £876m), (which received £258m of contracts) and (which received a contract worth £880,000). The Cabinet Office said Agnew had been referring companies that approached his office. Uniserve said the DHSC had approached it directly and that it had no connections with Agnew. Lady Mone is listed as referring (which received two contracts worth £202.8m);[23] however, Mone's lawyers had previously told The Guardian in 2020 that she did not have "any role or function in PPE Medpro, nor in the process by which contracts were awarded to PPE Medpro".[24]

According to The Sunday Times, the government gave £1.5 billion to companies linked to the Conservative Party.[25] Although the NAO said that there was "no evidence" that ministers were "involved in either the award or management of the contracts",[17] companies who had links to government ministers, politicians or health chiefs were put in a high-priority channel[26] which was fast-tracked; those in it were ten times more likely to win a contract.[17] In an opinion piece, BBC economics correspondent Andrew Verity said that there was an increased risk that contracts would be seen to be "awarded not on merit or value for money but because of personal connections" when fast-tracking occurs.[17]

Alleged cronyism[]

The Baroness Harding, a Tory peer, was appointed to run NHS Test and Trace, leading to accusations of cronyism

The Baroness Harding, a Conservative peer and the wife of Conservative MP John Penrose, was appointed to run NHS Test and Trace,[25] until the establishment of the UK Health Security Agency in April 2021.[27] In October 2020, Mike Coupe (a friend of Harding)[28] took a three-month appointment as head of infection testing at NHS Test and Trace.[29] The Good Law Project and the Runnymede Trust brought a legal case which alleged that Johnson acted unlawfully in securing the two contracts, choosing the recipients because of their connections to the Conservative Party;[28] as of June 2021, the case is still ongoing, although previous action over Kate Bingham's non-competitive appointment as head of the vaccine taskforce was dropped.[30] A spokesman for the government told The Guardian at the time: "We do not comment on ongoing legal proceedings."[28]

George Pascoe-Watson, chair of Portland Communications, was appointed to an unpaid advisory position by the DHSC and participated in daily strategic discussions chaired by Lord Bethell.[31] Pascoe-Watson sent information about government policy to his (paying) clients before it was made public.[32][33] Conservative peer Lord O'Shaughnessy was paid as an "external adviser" to the DHSC when he was a paid Portland adviser. O'Shaughnessy participated in a May call with Bethell and Boston Consulting Group (BCG), a Portland client which received £21 million in contracts on the testing system.[25] BCG management consultants were paid up to £6,250 per day to help reorganise the Test and Trace system.[34]

Other allegations of cronyism include:

  • Faculty, which worked with Dominic Cummings for Vote Leave during the Brexit referendum, has received government contracts since 2018. After Johnson became prime minister, Ben Warner (a former Faculty employee who worked on Vote Leave) was recruited by Cummings to work with him in Downing Street.[35]
  • Hanbury Strategy, a policy and lobbying consultancy, has been paid £648,000 for two contracts: one (awarded under the emergency procedures) to research "public attitudes and behaviours" in relation to the pandemic, and the other (at a level not requiring a tender) to conduct weekly polling. The company was co-founded by Paul Stephenson, director of communications for Vote Leave and a contender for Downing Street Chief of Staff. In March 2019, Hanbury was tasked with assessing job applications for Conservative special advisers.[35]
  • Gina Coladangelo, a close friend of Matt Hancock with no known health background, was paid £15,000 as a non-executive director of the DHSC on a six-month contract; Coladangelo accompanied Hancock to confidential meetings with civil servants, although there was no public record of the appointment. She received a parliamentary pass sponsored by Bethell, although she is not part of Bethell's team.[36] Coladangelo resigned from her position after it was revealed that she and Hancock were having an extramarital affair.[37]
  • According to The Guardian, Alex Bourne, a former neighbour and owner of the Cock Inn pub, near Hancock's constituency home, received a contract which involved supplying "tens of millions of vials for NHS Covid-19 tests", according to The Guardian.[38]

PPE and equipment contracts[]

, a Mauritius-based investment firm with no prior public-health experience, received a £252 million contract in April 2020 to supply face masks. The contract included an order for 50 million high-strength FFP2 medical masks which did not meet NHS standards; they had elastic ear loops, instead of the required straps which tie behind the wearer's head.[18] According to the company, they adhered to the specifications which they were given.[18] The contract was arranged by Andrew Mills (then an adviser to the Board of Trade, a branch of Liz Truss's Department for International Trade, whose involvement was criticised by the Good Law Project.[35] According to the DIT, neither it nor the Board of Trade was involved in the deal.[35]

Owen Paterson in the House of Commons as MPs debated whether to suspend him in November 2021.
A Randox PCR home test kit in the UK, showing the swab, and multi-layer packaging to deliver it to the lab
A Randox sample drop box

Former Conservative party chair Lord Feldman was appointed as an unpaid adviser to Conservative peer Lord Bethell.[39] Feldman was present when Bethell awarded Meller Designs (owned by David Meller, who gave £63,000 to the Conservative Party, mostly when Feldman was chair) £163 million in contracts for PPE on 6 April.[25] Conservative MP and former Secretary of State for Northern Ireland Owen Paterson participated in a phone call three days later with Bethell and Randox, who pay Paterson £100,000 a year as a consultant. The Grand National (the biggest sporting event of the Jockey Club, of which Harding is a board member) is sponsored by Randox, who received £479 million in testing contracts; orders continued after Randox had to recall half a million tests because of safety concerns.[25] During the Owen Paterson lobbying scandal, it was reported that in March 2020, Randox was awarded a £133 million contract from the Department of Health and Social Care to produce testing kits (at a cost of £49 each)[40] without any other firms being given the opportunity to bid for the work.[41] A further £347 million contract was awarded to Randox six months later without other companies being able to bid.[40]

One of the largest government PPE contracts went to Crisp Websites (trading as PestFix), a business specialising in supplying PPE to protect users from airborne chemicals in a pest-control setting.[42] PestFix secured a contract in April with the DHSC for a £32 million batch of isolation suits; three months after the contract was signed, suits from PestFix were not released for use in the NHS because they were in an NHS supply-chain warehouse awaiting safety assessments.[2] The Health and Safety Executive (HSE) concluded that supplies of PPE had not been specified to the correct standard for use in hospitals when they were bought. One email from a firm working with the HSE in June says that there was "'political' pressure" to get the suits through the quality-assurance process.[2] The gowns were approved for use and released to hospitals during the summer, and HSE chief executive Sarah Albon strongly denied claims that her organisation was under 'political' pressure to approve PPE.[42]

In a 25 November 2020 letter, Albon wrote: "At no time in the management of PPE supply have any HSE staff indicated that there were feelings of pressure being applied to make specific decisions, to change decisions, or to accept lower standards than required of PPE." According to Albon, technical assessments sometimes had to be repeated; the gowns' release to hospitals after failing the first inspection did not mean that they were unsuitable or unsafe. "In such cases HSE may have asked the supply chain to obtain further information, or to arrange for further testing, to verify the product. In these cases, products that initially had insufficient or incorrect information provided may have been subsequently reassessed and agreed for supply when those gaps had been addressed."[42] The contract is being challenged in the courts by the Good Law Project, which asked why the DHSC had agreed to pay 75 per cent in advance when the provider was "wholly unsuited" to deliver such a large and important order;[2] the project discovered that the company had actually been awarded PPE contracts worth £313 million.[18]

See also[]

References[]

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