Contingencies Fund (No. 2) Bill

Bill Esterson Excerpts

2nd reading
Thursday 11th March 2021 Commons Chamber

[Bill Esterson (Sefton Central) (Lab) [V]]

The Government’s test and trace scheme, outsourced to companies such as Serco, has been one of the most scandalous wastes of public expenditure in living memory. It is quite difficult to imagine what £37 billion looks like, but here are some examples. In 2015, the Northumbria Specialist Emergency Care Hospital was constructed at a cost of around £75 million; £37 billion is enough money to build nearly 500 brand-new state-of-the-art hospitals. With around 670,000 nurses on the permanent NHS payroll, £37 billion is enough to give every single nurse a pay rise of not £3.50 a week but around £50,000. But instead, what did the Chancellor, in his recent Budget, announce for nurses? Not even, actually, a pay rise of £3.50 a week, but, in real terms, a pay cut of about £5 a week.

It is a disgrace that this Government are so profligate with their cash that they will give £37 billion to private outsourcing giants, including Serco, and at the same time choose to take money away from our nurses with that real-terms pay cut. Of course, if that £37 billion had kept people safe—if it had worked—that huge sum of money might have represented value for money. Yet as the National Audit Office said:

“The Department of Health & Social Care justified the scale of investment…on the basis that an effective test and trace system would help avoid a second national lockdown; but since its creation we have had two more lockdowns.”

The ineffectiveness of the outsourced test and trace system is one of the reasons the UK has experienced the worst death rate of any major country. Yesterday, Serco’s top two executives, one of whom is the brother of a Conservative MP, received £7.4 million each in pay, including bonuses worth about £5.5 million. The company has previously handed out over £17 million in dividends to shareholders while reaping the rewards of its role in the grossly wasteful and ineffective test and trace programme. Today we read that the Business Department has invited Serco bosses, among others, to apply for new year’s honours. We now have a Government all too happy to waste billions of pounds on dodgy contracts for companies with Conservative party links, and when the scheme invariably fails, they give the people responsible a title as a consolation prize, all the while starving our public sector of funding and our public sector workers of pay.

After £37 billion, no test and trace, and the failure to prevent the second and third lockdowns, Ministers and those profiteering from this say it was a success. The National Audit Office says that there is no evidence of effectiveness. England has had the worst death rate in Europe. Other countries were able to balance value for money with support for the public’s health and the economy. If other countries can do better, the Government at Westminster can and must do better too.

All this is to say nothing of the disastrous PPE contracts. PPE Medpro was incorporated on 12 May. Just 44 days later, it was awarded a contract worth £122 million for single-use medical robes, which it intended to import. The contract was not advertised, but the company had links to the Conservative party and a Conservative peer. In contrast, my constituents who own Florence Roby Ltd, a uniform supplier with a track record of more than 50 years’ trading, spent months trying to get a contract for medical robes but were given the runaround and eventually had to lay off staff. I am afraid that these examples illustrate perfectly everything that has been wrong with procurement during this crisis: wastefulness and poor value for money. No wonder so many people think this is corrupt.

Compare this with the situation in Wales, where decisions on PPE are devolved. Since the outset of the pandemic, well over 450 million items of PPE have been distributed in Wales, and the vast majority of the PPE issued has been directly sourced by NHS Wales Shared Services Partnership, with all contracts awarded subject to robust governance. That includes additional scrutiny from a finance governance group, and all contracts over £1 million are approved by the Welsh Government directly. The UK Health Secretary has said that urgency is the reason that the Conservatives paid billions of pounds to their mates for PPE contracts, but that does not excuse the fact that companies with connections to the Conservative party such as PPE Medpro—which, remember, was awarded a contract 44 days after incorporation—were 10 times more likely to win contracts than those without those contacts.

In Wales, with a Labour Government, the situation was just as urgent, but the oversight and accountability were in place. Instead of waste, we have seen local public health boards delivering effective contact tracing, without the scandalous payments that we have seen in England of up to £7,000 a day to consultants. The Westminster Government must be able to spend the money needed to address the public health emergencies of the pandemic—everybody agrees on that much—but they must also listen to the National Audit Office, put an end to the cronyism and put public health first. The day of reckoning will surely come for the gross negligence, waste and cronyism displayed by this Conservative Government.