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Latest 21 December 2020

Government PPE staff racing to cancel and delay excess orders

By Katherine Hignett 

Hospitals were desperate for PPE at the start of the UK’s Covid-19 outbreak, turning to DIY shops and even fetish websites to equip their staff in the face of scarce central provisions: something trust procurement heads called a “system failure”.

Nine months later, the UK is facing the opposite problem: a glut of PPE that cannot be adequately stored on our shores. 

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The Government’s PPE team has been working since at least September to stem the flow of kit from the Far East. Staff have been negotiating with suppliers to exit contracts and delay PPE production, say senior procurement sources in the Department of Health and Social Care and the NHS. 

The UK’s storage capacity has been stretched to its limits by Brexit stockpiling and by recent influxes of PPE. Sources suggest between 28 and 30 warehouses of various sizes are currently being used to hold the equipment in the UK.

In early November, deals were struck for additional storage space in China: capacity for up to 240,000 pallets, at two warehouses. Sources describe these as a “short term solution” to hold overflow stock at source. Contract notices for the warehouses do not appear to have been published on Contracts Finder or in the Official Journal of the European Union. But sources say that emergency procurement rules were used instead of the usual formal tendering route.

It is hoped these measures will limit the impact of PPE shipments on the already fraught ocean freight network. Brexit, a shortage of empty containers and now, a freight ban from France, have put enormous strain on ports.

Large PPE shipments have already created chaos at ports, with a PPE backlog equivalent to at least 11,000 20ft containers causing a major bottleneck at the Port of Felixstowe last month. This backlog — which peaked at roughly 14,000 containers, according to one source — has since been moved from Felixstowe. But as The Guardian and ITV News revealed on Friday, it seems many of these containers have simply been shifted to other ports including the nearby Port of Ipswich. 

Early PPE orders were made according to “worst-case scenario” demand models produced by management consultant firm McKinsey. Procurement sources at both the DHSC and the NHS have repeatedly expressed their frustration over a lack of access to these models, which appear to be behind the current glut. One senior source told me: “The [volume of] PPE we’ve got is unprecedented. We’ve obviously ordered loads more than we need.”

Of the 32 billion items of PPE ordered since the start of the pandemic, some 22 billion have either been delivered or are in transit, with the vast majority imported from the Far East. Yet the most recent statistics show just 5.9 billion items have been distributed to hospital trusts and other care organisations in England so far, with another four months’ worth of key equipment being stockpiled in the UK. 

With many contracts and invoices still to be published, it’s not yet clear how successful procurement staff have been in negotiating down future orders  — or whether this will add to the already enormous cost of PPE. 

Katherine Hignett is a health policy reporter who previously served as procurement correspondent for the Health Service Journal. She recently earned an “Excellence in Reporting Coronavirus” nod from Press Gazette for her work exposing PPE shortages.