VIP lane: Government claws back just 3.4% of the £1bn wasted on useless PPE

Four years after the pandemic hit, the health department has recovered just 3.4% of the £1bn Tory ministers wasted on useless personal protective equipment (PPE) through fast-track contracts with friends and supporters.

As the Tories scrambled to replace stocks of gowns, gloves and masks, they handed out contracts worth around £3.8bn through the unlawful VIP lane. More than £1bn of those contracts were for equipment that was totally useless in the NHS.

Despite setting up a dedicated team to recover this money in early 2022, health department spend records show the government has retrieved just £34.8m from these contracts, with money recovered from only seven of the VIP lane firms known to have provided unfit PPE.

The department has recouped some money from firms including P14 Medical, Sante Global  LLP (formerly Unispace) and Pestfix, which has paid back the most to date – just under £26m.

After one Pestfix director met the health department’s chief commercial officer at a birthday party, the company landed contracts for £347m. More than £84.4m worth of the medical face masks, gowns and gloves supplied by this pest control company were deemed unfit for use in the NHS, but Pestfix directors have recently bought themselves at least two houses worth a total of £1.7m.

A mediated settlement required the company to return £70m, of which the records show £26m has been paid back. The department has not published details on the status of the remaining £44m.

But, according to publicly available records, companies such as SG Recruitment, Ayanda Capital and Worldlink Resources – which supplied £106m worth of PPE deemed unusable in a medical setting – have paid back nothing at all. If these figures are correct, the total handed out to Tory friends and supporters through the VIP lane for useless PPE that has not been recovered stands at a staggering £979m.

We put these figures to the health department many times. The department did not contest them and offered no comment on the record, but referred to minutes of a Treasury progress report (PDF) which promised to “provide regular updates” including “information about the amount that has been reclaimed”.

“There will be some instances where the information is commercially sensitive and could impact the department’s ability to successfully pursue cases to completion,” the report states. “Where this is the case, the department will consult with the parliamentary clerk to determine how best to provide the information to the committee in confidence. The information will be made publicly available in due course.”

But time is of the essence. Eight VIP lane companies who supplied useless PPE worth £338m have already shut up shop, making it almost impossible to recover money from them.

The owner of P14 Medical, Steve Dechan, said the health department’s spend records were “totally incorrect”, and rejected the department’s figures showing that £183m of the PPE supplied by the company was unfit for use in the NHS.

“They agreed we supplied quality standard kit on time,” Dechan said. “Indeed they paid us some additional money.”

Dechan did not explain what this “additional money” was for, insisting the department’s figures were “complete utter crap”, as well as that P14 Medical “did not pay back £1.2m” to the department as spend records show and “didn’t need to”.

“Has to be said the Department of Health and Social Care are the culprits,” he added, “not the vast majority of suppliers.”

None of the other firms we mention in this article responded to requests for comment.

For Steve Goodrich, head of research and investigation at Transparency International UK, the government “put substantial amounts of money at risk” by prioritising suppliers “because of who they knew rather than what they could deliver”.

“Systemic bias in the award of PPE contracts was neither justifiable nor value for money,” Goodrich said. “We hope the official Covid-19 Inquiry helps establish the facts about how the VIP lane operated, too much of which remains unanswered.”

Rachel Reeves is due to appoint a Covid corruption tsar “within weeks”, targeting as much as £2.6bn lost to waste, fraud, and flawed pandemic-era contracts. The chancellor is expected to tell parliament she will “get back what is owed to the British people”. We’re standing by to make sure that ambition is delivered.

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