Half of VIP lane companies supplied PPE worth £1 billion that was not fit for purpose

Author: Spotlight On Corruption

11.02.2022

Spotlight on Corruption has established that 25 of the 50 companies in the government’s ‘VIP lane’ supplied PPE worth £1 billion that was not fit for purpose. This amounts to 59% of all money awarded to VIP lane companies for PPE. One third of the total spent on unsuitable PPE went to those companies.

On 15 September 2021, health minister Lord Bethell confirmed that, as of June, 1.9 billion items of personal protective equipment (PPE) worth £2.8 billion were in the ‘do not supply’ category.

In response to a freedom of information request, the Department of Health & Social Care (DHSC) sent us the list of 127 suppliers who provided that PPE, along with the quantities of PPE and costs.

We identified that 25 of these suppliers were in the government’s VIP lane – the special route for companies recommended by ministers, MPs and officials, which was found to be unlawful. The government has so far confirmed the names of 50 companies that were referred to the VIP lane.

We have listed below the 25 VIP lane suppliers that provided ‘do not supply’ PPE. This includes companies referred to the VIP lane by Michael Gove, Baroness Mone and Matt Hancock, among others.

Our analysis reveals that £1 billion was awarded to these suppliers for unsuitable PPE.

The government previously claimed that £1.7 billion was awarded to VIP lane suppliers in total. If that figure is correct, 59% of the money given to VIP lane suppliers was for unsuitable PPE. Of the £10.4 billion awarded to suppliers for PPE in the normal channel, 17% (£1.8 billion) was spent on unsuitable PPE.

The total amount spent on unsuitable, defective and overpriced PPE is closer to £9 billion.

The fact that one third of the total spent on unsuitable PPE went to half of the VIP lane suppliers will renew questions about the government’s due diligence and decision-making processes.

One in ten suppliers processed through the VIP lane (50 out of 493) were awarded contracts, compared to less than one in a hundred suppliers through the ordinary lane (104 of 14,892).

In November 2021, the government confirmed that 46 of the contracts awarded through the VIP lane did not go through the 8-stage due diligence process which was introduced by DHSC in May 2020.

In August 2021, Lord Bethell said that DHSC “was engaged in commercial discussions (potentially leading to litigation)” in relation to 40 contracts for undelivered or substandard PPE worth £1.2 billion. But it is not clear which suppliers the government is seeking to recoup losses from.

It is essential that the government provides full transparency about: its due diligence and clearance processes in relation to all VIP lane suppliers, the steps it is taking to recoup losses, and any action being taken to ensure that poor performing companies are not awarded further contracts.

Notwithstanding the fact that the government needed to act urgently, the scale of unsuitable PPE will have impacted on supply chains and the national response to the pandemic.

Lessons must be learned from the government’s handling of Covid-19 procurement. The Procurement Bill should be introduced as a priority, and the new framework must embed transparency and ensure that transparency and conflict of interest standards are guaranteed in any future emergency.

 

Supplier Quantity of PPE Total cost
AIYA TECHNOLOGY 368,650 £8,155,335
AYANDA CAPITAL LTD 44,553,600 £138,116,160
CRISP WEBSITES LTD TA PESTFIX 46,688,900 £84,419,554
EUTHENIA INVESTMENTS LTD 12,290 £57,120
EXCALIBUR HEALTHCARE SERVICES LTD 4,459,300 £20,066,850
HEADWIND INDUSTRIAL (CHINA) LTD 1,000,430 £2,501,075
HOTEL LOGISTICS LTD 3,024,460 £2,587,235
IDEAL MEDICAL SOLUTIONS LTD 995,660 £4,342,510
INVISIO LTD 8,383,500 £2,221,628
MELLER DESIGN LTD 552,100 £8,464,466
MGP ADVISORY LTD 100,000 £600,000
NINE UNITED LTD 8,007,560 £69,745,848
P14 MEDICAL LTD TA PLATFORM 14 20,789,100 £183,567,753
P1F LIMITED 228,020 £691,032
PPE MEDPRO LTD 25,547,328 £124,670,961
REGAL POLYTHENE LTD TA REGAL DISPOSABLES 2,011,000 £38,209
REHEAR LABS LIMITED 723,675 £1,140,512
SG RECRUITMENT UK LTD 2,360,937 £26,477,555
THE PAPER DRINKING STRAW COMPANY LTD 21,889,430 £24,078,373
TOWER SUPPLIES 2,231,086 £10,633,901
UNISERVE LTD 182,877,570 £178,588,091
UNISPACE GLOBAL HEALTH* 153,560 £3,679,298
UNIVERSAL SOLUTIONS TRADING LTD 83,334,025 £7,500,062
VISAGE LTD 3,325,230 £6,268,406
WORLDLINK RESOURCE 11,912,785 £106,023,787
Total

 

475,530,196

 

£1,014,635,721

 

*The government’s list of suppliers in the VIP lane includes ‘Unispace’