Staggering waste of PPE procurement laid bare: DHSC still paying £7million/month to store unused PPE

Britain is spending £7million each month storing excess PPE that may never be used by NHS staff, new audit figures show, as the Government vows to pursue firms who overcharged for the protective equipment at the height of the Covid pandemic. 

Billions of PPE items remain unsuitable for frontline use and there were ‘inconsistencies’ between the volume of PPE ordered and what the Department for Health and Social care received, a National Audit Office report found.  

Among the damning findings from the spending watchdog include the fact 1.5billion items of PPE are being held in storage that have passed their expiry date, with the DHSC incurring penalty charges of almost £500m for storing PPE in containers longer than anticipated.

More than half of VIP fast-lane contracted suppliers – firms recommended by ministers, MPs and government officials – had provided unusable items. 

And the department is continuing to manage 176 contracts, whose supplies and quality of PPE have been disputed by the government, which carry a risk to an estimated £2.7bn of taxpayer-backed funds, the NAO adds. 

A cross-party Commons committee has since urged health officials to ‘get a grip’ on the PPE contracts, while minister Jacob Rees-Mogg says the government will ‘be after’ any cowboy companies who hiked prices at the onset of the pandemic.

It comes amid claims at least one firm allegedly sold Whitehall personal protective equipment ‘at three times the price’ they bought it for.

Britain’s taxpayers are continuing to foot the bill for masks, gowns and gloves procured more than two years ago, after it was revealed last month that almost £9bn had been wasted on personal protective equipment during the pandemic. 

Previous reports provided an eye-watering illustration of the scale of waste, as much of the Covid kit procured at the start of the pandemic was faulty or never used before its sell-by date. 

Other problems included failed quality tests, face masks ordered with the wrong loops and gowns that were the wrong size or sent in the wrong packaging. 

Ministers paid hugely over the odds and were left with equipment that later crashed in value. In all, £8.7billion has had to be written off by the Department of Health and Social Care. 

The latest analysis from Gareth Davies, chief auditor to the House of Commons, acknowledged the Department was required to ‘rapidly buy PPE in unprecedented circumstances’.

But he warned more than 150 contracts still managed by the DHSC ‘may not achieve full value for money, with an estimated £2.7bn at risk’.  

Labour MP Dame Meg Hillier, chair of the Commons public accounts committee said: ‘The numbers are staggering – over 30bn items of PPE received so far with 5bn more on the way and 3.6bn items that can’t be used by frontline services.

‘Storage alone has cost over £700m, with DHSC continuing to spend £7m a month storing PPE it doesn’t need.

‘Whatever forbearance the taxpayer may have had at the start of the pandemic, this will quickly wear thin if DHSC can’t now manage the consequences. 

‘The department must urgently get a grip of its PPE stocks and focus on protecting value for taxpayers. It has to claw back contract costs where it can, get rid of unusable PPE, and cut down on expensive storage.’ 

The NAO’s report stated of PPE which has been received, 17.3 billion items (55 per cent) were sent to frontline staff, but 14.1 billion items – worth £8.5bn – remain either in one of 50 warehouses, with suppliers, or in shipping containers.

By November 2021 it had cost the DHSC £737m to store PPE, with £436m of that coming under penalty charges because health bosses failed to move the items out of shipping containers in time.

It comes as Jacob Rees-Mogg today warned the Government is after ‘anyone who has overcharged us’ when asked about a company allegedly selling Whitehall personal protective equipment (PPE) ‘at three times the price’ they bought it for.

Mr Rees-Mogg’s comments came as shadow Cabinet Office minister Rachel Hopkins told the Commons: ‘We know they handed hundreds of millions of pounds of our money to an offshore company involving a Tory peer, created just days before and without any transparency, which sold Government PPE at three times the price they bought it for.

‘They are now in mediation because it wasn’t even fit for use. And millions of items are now stuck in storage costing us even more.

‘They refused even now to reveal what they know about the company in question. So perhaps, he will answer this.

‘When will we finally get the promised Procurement Bill and what safeguards will be in it to stop yet more public money being wasted and end the so-called emergency bypassing of procurement regulations?’

Brexit opportunities minister Mr Rees-Mogg replied: ‘This is the classic socialist point of view that we shouldn’t have done anything, we shouldn’t have done anything to get PPE urgently… We should have sat comfortably upon our hands and allowed PPE to not be provided around the country. 

‘The Government got on with doing the job that was necessary. Of course, it ensures value for money and anyone who has overcharged us, let them be under no doubt, we are after them.’

Among those to make small fortunes from PPE contracts was banker Tim Horlick who sourced £253million of PPE from Asia after his firm Ayanda was fast-tracked by an adviser to Foreign Secretary Liz Truss.

Pest control firm Pestfix, whose owner Dan England was dubbed the ‘bird repeller’, had just £18,000 in the bank when it scooped a £348million contract for PPE.

Several contracts worth £679million were handed to Anthony Hazell, a 36-year-old from south-east London, despite his background being in interior design.

Meanwhile, Tory peer Baroness Mone is being investigated by the Lords standards watchdog over the awarding of Government contracts worth more than £200 million to a PPE supplier.

Lady Mone has consistently denied any ‘role or function’ in the company, and her lawyers have said she is ‘not connected to PPE Medpro in any capacity’.

A DHSC spokesperson said: ‘Our priority throughout the pandemic has been saving lives, and we have delivered over 19.1 billion items of PPE to frontline staff to keep them safe.

‘Having too much PPE was preferable to having too little in the face of an unpredictable and dangerous virus, given this was essential to keep our NHS open and protect as many people as possible.

‘Where contracts are in dispute, we are seeking to recover costs from suppliers and we expect to recover significant amounts of taxpayers’ money.’