A lack of transparency has left taxpayers in the dark over Covid contracts
The Covid-19 pandemic required emergency action.
Parliament gave ministers permission to act fast in response, but this was not a licence to act fast and loose with taxpayers’ money. In report after report, the Public Accounts Committee has been sounding the alarm about poor record-keeping, huge profits made by some companies and contracts awarded without competition. Although the latter was allowed under the rules, it extended beyond the early days of the pandemic when business as usual was not an option. Even when companies failed to deliver on their obligations, contracts were extended to the tune of millions of pounds, often without testing the market.
Covid-19 testing company Randox was awarded contracts worth an eye-watering £776.9m by the Department for Health and Social Care (DHSC). But basic records about the details of the contractual negotiations do not exist. There are no records of whether simple practices, such as price benchmarking (when prices are compared with competitors), were followed. Despite Randox struggling to deliver on the expected level of testing capacity after the first agreement was reached, the government agreed a £328m contract extension – again without competition.
There were numerous high-level meetings between ministers and Randox, but what was discussed at some is unknown. Many were not properly declared and minutes for the vast majority not kept. It leaves the role that ministers had in approving the contracts confused and unclear. Some are quick to point out there is no evidence contracts were awarded to Randox improperly. But shoddy record-keeping means there’s precious little evidence.
Every penny of taxpayers’ money spent must be accounted for and decision-makers held accountable. For this, transparency and good record-keeping is vital. It is simply not good enough to throw overboard basic procedures and due diligence during a crisis. Responsible governments prepare for emergencies and have in place contingencies for events like a pandemic. There are agreed emergency procedures in place to safeguard taxpayers’ interests and prevent unscrupulous groups from making a quick buck in a time of crisis. But in the case of sourcing personal protective equipment (PPE) it is another story of poor due diligence and huge profits for select companies.
Up to £13bn of taxpayers’ money was spent sourcing PPE – much of this was wasted on unusable or substandard PPE and, in some cases, fraudulent contracts. The DHSC is, rightly, attempting to claw back some money, and £2.7bn worth of PPE contracts is currently being disputed. But poor record-keeping and lack of due diligence at the beginning of contract negotiations means the government is paralysed from acting in some cases.
And the spending hasn’t stopped. The government has hired top public relations and legal firms in preparation for the Covid-19 public inquiry, and racked up further bills of £85m. Spending so much at such an early stage suggests this is likely to be one of the most expensive statutory public inquiries. Before Covid, any minister would have thought twice before signing off such large cheques. The emergency situation gave government the right to act fast and allowed contracts to be let without tendering, but the lack of curiosity and speed with which sloppy approaches became business as usual is concerning.
Important, and expensive, decisions were made during the government’s response to the pandemic and in many cases taxpayers are being left in the dark. Getting to the bottom of what happened and how certain decisions were reached has been difficult. And the hefty amounts spent on top-notch PR and legal executives means the public inquiry may yet have its work cut out for it.
All this casts a murky shadow. In the words of a previous prime minister, sunlight is the best disinfectant. Without a clear record of what happened, as billions was spent, sunlight will struggle to reach some corners of the Covid response.
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