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Tue, 26 January 2021

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Obscene profiteering and cronyism has been the hallmark of the government’s response to Covid

Obscene profiteering and cronyism has been the hallmark of the government’s response to Covid

The government’s incompetence, its cronyism, its ideological obsession with outsourcing and privatisation has undermined our NHS and put lives at risk, writes Dan Carden MP. | PA Images

3 min read

Firms were fast-tracked for lucrative Covid-19 contracts, with little or no prior experience, after tips from Ministers, MPs and peers. The need for a robust system of checks and balances has never been more pressing.

Under the cover of the pandemic, billions of pounds of public money has been handed to private companies, including Tory-linked firms, without competition or transparency, and without democratic accountability. 

The National Audit Office report on its investigation into government procurement during the Covid-19 pandemic has exposed chronic mishandling, major conflicts of interest, a failure to impose proper checks in the award of contracts and serious squandering of public money – and it could just be the tip of the iceberg. 

Since the pandemic started, an emergency exemption to procurement laws has allowed the government to award contracts without having to give different companies a chance to bid for them.

Of the £17.3 billion dished out to private-sector suppliers, £10.5 billion was awarded without any competition.

The report found that the government unit set up to procure PPE, established a “VIP” high-priority lane for companies with political connections. Hundreds of firms were fast-tracked for lucrative Covid-19 contracts after tips from Ministers, MPs and peers. These favoured firms were ten times more likely to be awarded contracts.

For too long, the public purse has been treated by politicians as a resource for corporate allies to plunder

The Sunday Times recently reported that £1.5 billion has lined the pockets of companies with direct links to friends or donors of the Tory Party.

The report found examples of contracts, some for hundreds of millions of pounds, being awarded without basic documents that would normally be drawn up to protect against the misuse of public funds. Whitehall departments have failed to explain why they chose a particular supplier or to document possible conflicts of interest.

It feels like every day brings shocking new revelations about Tory-linked firms with little or no prior experience with medical supplies being handed contracts to provide equipment at vastly inflated prices, while experienced and qualified providers were overlooked.

If this happened in any other country, we would call it corruption.

So far, the government has refused to come clean about which companies were put into the VIP lane or who referred them, which begs the question: what have they got to hide?

We now know that some of these contractors completely failed to deliver the goods or services they were paid to provide. The absence of penalty clauses means they get paid all the same. 

The government’s incompetence, its cronyism, its ideological obsession with outsourcing and privatisation has undermined our NHS and put lives at risk.

These problems didn’t start with the pandemic. For too long, the public purse has been treated by politicians as a resource for corporate allies to plunder – but coronavirus has shone a light on the scandalous extent to which naked self-interest pervades the highest levels of government.

The government's own Anti-Corruption Strategy warns 'Corruption threatens our national security and prosperity, both at home and overseas. Unchecked, it can erode public confidence in the domestic and international institutions that we all depend upon.' 

The obscene profiteering and cronyism that has been the hallmark of the UK’s response to Covid-19 has further eroded what little trust people have left in our political system.

The need to challenge conflicts of interest, extend democracy and fight for a robust system of checks and balances to hold power to account has never been more pressing. 

 

Dan Carden is the Labour MP for Liverpool Walton.

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