A “generous” Tory donor who supported Michael Gove’s UK Conservative Party leadership bid in 2016 secured lucrative personal protective equipment (PPE) contracts amid the COVID-19 pandemic after the minister referred his firm to a “VIP lane”, reported The Guardian.
Co-owned by David Meller until this January, Bedford-based Meller Designs was awarded six PPE supply contracts worth £164m from the Department of Health and Social Care (DHSC). At the time of the deal, Michael Gove was a Cabinet Office minister, responsible for government procurement, and in charge of the office of the chancellor of the duchy of Lancaster.
Meller Designs, which ordinarily manufactured fashion and beauty products, was among 47 companies awarded contracts for PPE - many without any competitive tender - totaling £4.7bln ($6.3 bln) after referrals from politicians and officials, according to the outlet.
The British businessman touted as a "generous Conservative party donor" was a trustee of the think tank Policy Exchange, founded by Michael Gove, and finance chair of Gove's 2016 Conservative leadership campaign. He has donated nearly £60,000 ($ 80.700) to the Tory party since 2009. This included £3,250 to support Gove’s party leadership bid.
In the wake of the report, a spokesperson for Michael Gove was cited as denying any impropriety regarding the referral.
‘Fast Track’ Lane
The “fast-track” so-called VIP lane was set up by officials to enable ministers, MPs, Lords and top government officials to recommend firms that could help secure PPE for medical staff amid a struggle to source equipment in 2020.
The list of companies that benefited from the VIP lane was published by Politico on Tuesday ahead of its official planned release by the DHSC in line with a freedom of information request by the Good Law Project (GLP). The non-profit had been the first to reveal the existence of a VIP lane, and jointly with campaign group EveryDoctor challenged the DHSC over its lawfulness.
Last year’s report by the National Audit Office (NAO) found that companies referred as possible PPE suppliers by ministers, MPs or senior NHS officials showed a 10 times greater success rate for securing PPE contracts than firms whose bids traversed regular channels.
According to the leaked list, former UK Health Secretary, Matt Hancock referred four firms for a fast-tracked PPE contract bid. One of them was Excalibur Healthcare, which won £135.4m in contracts.
Andrew Feldman, Tory peer and former chair of the party, who had been drafted in by the Department of Health to study PPE supply offers, referred three of the companies: SG Recruitment won contracts worth £79.6m, Skinnydip Ltd won a £12.8m contract, and Maxima Markets won a £1.85m contract.
According to Feldman, he had no previous knowledge of the companies and had, in an unpaid capacity, passed on offers deemed credible to officials. He was cited by the outlet as adding that he had no knowledge the companies in question ended up in the fast-track lane.
Another Tory peer, lingerie businesswoman Michelle Mone is listed as having referred a company called PPE Medpro which was awarded two contracts worth £202.8m. In 2020 a spokesperson for Mone had been cited as denying the peer had “any role or function in PPE Medpro, nor in the process by which contracts were awarded to PPE Medpro”.
The UK Labour Party has repeatedly accused the government of Boris Johnson of favouring people with Tory connections in awarding of lucrative contracts during the pandemic.
“It shows just how engulfed in corruption this government is that the minister in charge of procurement and ensuring that contracts are awarded to the best bidder and represent value for money for the taxpayer was helping his own donor to get VIP fast-track access to contracts,” Angela Rayner, Labour’s deputy leader and the shadow chancellor of the duchy of Lancaster, was cited as saying.
The DHSC has vehemently denied that ministers were involved in decisions to award contracts. According to the department, all company offers referred were subjected to a due diligence process.
“At the height of the pandemic there was a desperate need for PPE to protect health and social care staff and the government rightly took swift and decisive action to secure it. Ministers were not involved in awarding contracts,” said a government spokesperson.
The Good Law Project has applauded the fact that “the vast financial rewards you could reap if you had a minister looking out for your interests” had been revealed, with its said its director, Jo Maugham, cited as adding:
"There was no good reason — but there were obvious bad reasons — for government to keep the public in the dark about these links. We now need some transparency about the equivalent VIP lane for Test and Trace contracts — on which £37bn of public money was spent."