Government PPE Contracts

Meg Hillier Excerpts

Tuesday 6th December 2022 Commons Chamber

[Angela Rayner]

I thank the hon. Member for his point, and he is absolutely right. The Fire Brigades Union members were in Parliament and outside it today. They are frustrated, like many others who have been told that there is not money to give them a pay rise and that, actually, they are going to get a real-terms pay cut. But at the same time, billions of pounds has been wasted. As I said in my opening remarks, £770,000 a day has gone on storing this equipment. It is not acceptable to most people and most members of the public.

[Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

My right hon. Friend has highlighted one particular legal situation, but I am sure she is aware that the Department of Health and Social Care remains in dispute on 176 contracts for PPE worth £2.7 billion. I wonder whether she has any thoughts about that.

[Angela Rayner]

The Chair of the Public Accounts Committee is absolutely right. It is absolutely eye-watering and astonishing that 176 contracts remain in this situation. The public can see that and they are frustrated, because it is not acceptable and not okay to govern in that way. The public rightly want answers, and they want them now.

The links between the company Medpro and the Tory peer in question were never publicly disclosed. In fact, they were denied repeatedly by the lawyers acting for those involved. We now know that the money ended up in offshore accounts directly linked to those individuals. By their own admission, this was for so-called tax efficiency. It seems that they even dodged paying their own taxes on the profits they made from ours. Only after a long legal battle was it revealed that there was active lobbying from ministerial colleagues for access to the VIP lane and substantial contracts were won by those companies. They said that the peer in question did not benefit from these contracts. That denial has been rather undermined by the latest revelations of The Guardian, rather than any disclosure of Ministers. It was only some time after The Guardian exposed those links that a Minister, the right hon. Member for Charnwood (Edward Argar), finally told me in answer to a parliamentary question:

“Departmental records reflect that a link between Baroness Mone and PPE Medpro was clear prior to contracts being awarded.”

But Ministers have, for months, refused to show us those records or tell us the nature of that link and whether it was declared or discovered in due diligence.

This was the subject of an investigation by the Standards Commissioners in the other place, yet it appears that Ministers sat on the information that they had. The question is very simple: what have Ministers got to hide? Did they know all along who was behind PPE Medpro, or was due diligence so poor that they did not realise the problem? If they had nothing to hide and no rules or laws were broken, Ministers will surely be happy to make the details of the meetings and correspondence available. While they are at it, will the Minister give us clarity about allegations made by the former Health Secretary in his new book about a separate bid for business connected to Baroness Mone?

--- Later in debate ---

[Will Quince]

I am pleased that the hon. Lady made that intervention, because it is the first I have heard of such an accusation being made. If she has evidence of such, I suggest that she presents it.

It might be helpful if I just talk through the process. Thousands of companies made offers; around 430 were prioritised through the high-priority lane; only 12% of those resulted in a contract; and due diligence was carried out on all companies by civil servants. Financial accountability sat with a senior civil servant, and Ministers—this is important—were not involved in the decision-making process. A team of more than 400 civil servants processed referrals and undertook due diligence tests.

On that basis, we will make no apology for procuring PPE at the pace and volume we did. Now that the global market for PPE has stabilised, it is easy for some people to point to the value of goods that are inevitably now sold at a much lower price than we paid, but that is a cheap shot, and one that entirely misses the point. We adjusted down the value of our PPE holding as market prices have changed—that is just standard accounting practice—and even then, we are still putting large quantities of it to use. Our successes should be judged on the conditions we faced at the height of the pandemic, not with the convenient benefit of hindsight.

Let me come to civil servants. If I may, I will give the right hon. Member for Ashton-under-Lyne (Angela Rayner) the benefit of my fast-approaching four years’ experience as a Minister. We rely on hard-working civil servants; they are the backbone of our state and it is my privilege to work with them. She knows that Ministers were not involved in the decision-making process for PPE procurement, and the due diligence, as I have said, was undertaken by a team of more than 400 civil servants. Although I am a Health Minister now, I was not at the time; I was a Minister at the Department for Work and Pensions. I recall how hard civil servants worked, under the most trying conditions, during the pandemic.

[Dame Meg Hillier]

rose—

[Will Quince]

I promise I will come to the hon. Lady.

Those 400 civil servants working on PPE and a senior accounting officer took decisions at pace and under huge pressure, as lives depended on them. Did they get everything right? No, they did not. But they did try their best in a highly competitive global market, with significant challenges in sourcing, procuring and distributing PPE. [Interruption.] Yes, they absolutely did. I gently say to the right hon. Member for Ashton-under-Lyne that her implied criticism of their professionalism, integrity and independence at a time of crisis, with the convenience and luxury now of hindsight, is deeply regrettable.

[Will Quince]

I will come to that. As I said, due diligence was carried out on all companies. Procurement decisions were taken by civil servants. Financial accountability sat with a senior civil servant. I thank and applaud our hard-working civil servants, and I humbly suggest that someone aspiring to be our Deputy Prime Minister should do the same and not seek to throw them under the metaphorical bus.

[Dame Meg Hillier]

Very early on, the Public Accounts Committee and the National Audit Office were looking into the issue. We know that it was a rush at the beginning, but we were warning about the problems early on, and still they persisted. There was poor record keeping—frankly, it was a lack of record keeping in many cases. This House gave the Government permission to act fast, but not to act fast and loose, and the Minister just needs to acknowledge that.

[Will Quince]

I thank the hon. Lady for her intervention, and I will come on to some of the action that we will take. She rightly mentions accountability. Details of the high-priority lane were published on 17 November 2021 and updated in February 2022. This is an important point, because the right hon. Lady, the deputy Leader of the Opposition, suggests that there is some kind of cover-up. If there is, Madam Deputy Speaker, listen to this, because this is some kind of cover up! As I have said, high-priority lane details were published on 17 November and updated in February this year. The National Audit Office has written three reports specifically about PPE. The Public Accounts Committee has held a number of evidence sessions. The Boardman review of procurement has taken place and we are implementing its findings in full. The independent public inquiry into the Government’s handling of the pandemic is ongoing. Of course there are lessons that we have to learn, and that we can and should learn, but there is clear accountability in this process.

As I have mentioned civil servants, I want to put on the record my thanks to the 400 civil servants who worked tirelessly to source deals from around the globe, buying PPE to the highest standards and quality and, yes, for the best value at the time. It was not only them; it was a true team effort—one that was made possible through some incredible collaborations, including everyone from industry to the NHS, and from social care providers to our armed forces. They all played their part and they played it well.

Turning now to unsuitable PPE or potential fraud, it is a simple truth that 97% of all PPE that we ordered was suitable and fit for use, with only a small proportion of the billions of items procured deemed unsuitable. Where that has been the case, we are actively seeking to recover costs from suppliers and we are working to maximise the value from our stockpiles, including using PPE in other settings outside of our NHS. Equally, in those rare instances where there have been allegations of fraud, my Department’s anti-fraud unit has worked quickly to investigate and move to recover costs.

With respect to some of the specific points raised in today’s motion, of the thousands of companies that made offers, around 430, as I have said, were processed through the high-priority lane, and only 12% of them resulted in a contract award. The right hon. Member for Ashton-under-Lyne knows that all contracts went through the same due diligence process regardless of the source of the offer. She also knows that the NAO has written three reports about PPE, and the Public Accounts Committee has held a number of hearings. I know that she would like me to go into the detail of individual contracts, but she knows—she even alluded to it—that my Department is engaged in commercially sensitive mediation with the relevant companies with a view to resolving the issue without recourse to formal legal action.

Responding specifically to the terms of the motion, the Government are committed to releasing information when all investigations are concluded. Our response will necessarily take into account the wider public interest and the commercially sensitive nature of the material. It is only right that we work with the Public Accounts Committee on the terms on which information might be shared. I understand that the Chancellor of the Duchy of Lancaster will soon begin a dialogue with the Chair of the PAC on how we enact those information-sharing arrangements.

[Dame Meg Hillier]

I thank the Minister for giving way again. I reassure him and the House that the Public Accounts Committee is responsible, not reckless. We have previously received papers from this House and we have a well-established protocol for receiving and dealing with such papers. The Committee is trusted—we never leak. If we decide to publish, that is a choice that we would make, but it is a responsible decision that we would take.

[Will Quince]

I thank the hon. Lady for that response, and I know the Chancellor of the Duchy of Lancaster will soon begin that dialogue with her.